What Is RevPAR?

By Matthew DiLallo – Updated Nov 20, 2024 at 1:47 PM

Key Points

RevPAR measures hotel revenue per room, combining occupancy rates and daily rates.
Rising RevPAR indicates improved hotel income; falling numbers suggest declining performance.
Hotels use RevPAR trends to adjust pricing and occupancy strategies for better profitability.

A key performance metric for the hospitality industry is a property's revenue per available room, or RevPAR. It helps gauge the overall performance of a hospitality property like a hotel by measuring how much revenue each room produces per night. Because of that, it's an important metric for commercial real estate investors who own hospitality properties like hotels as well as real estate investment trusts (REITs) focused on hospitality.

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Rear view of tourist in the hotel room pulling the curtains to see the view — Source: Getty images

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Revenue

Revenue is a business’s gross income or the amount of money it brings in from regular operations before costs are considered.

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About the Author

Matt DiLallo has been a contributing Motley Fool stock market analyst specializing in covering dividend-paying companies, particularly in the energy and REIT sectors, since 2012. He also covers pre-IPO companies, ETFs, and other investing topics. He holds an MBA from Liberty University.

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