RevPAR, revenue per available room, is the room revenue a hotel earned for every room it could have sold, whether it sold it or not. It joins price and occupancy in one number.
Formula
RevPAR = room revenue ÷ available room nights
RevPAR = ADR × occupancy rate
Both give the same result. Available room nights are your sellable rooms multiplied by the nights in the period. Rooms that are out of order and cannot be sold are left out.
Worked example
A 20-room hotel has 600 available room nights in a 30-day month (20 × 30). It sells 450 of them and earns 45,000 in room revenue.
RevPAR = 45,000 ÷ 600 = 75
Check it the other way. ADR is 45,000 ÷ 450 = 100, and occupancy is 450 ÷ 600 = 75%. 100 × 0.75 = 75.
Why it matters to a small property
ADR can rise while you sell fewer rooms, and occupancy can rise while you sell them cheaply. RevPAR only rises when the mix of price and volume earns more from the rooms you have. That makes it the figure to compare month against month, or this year against last.
RevPAR counts room revenue only. If you want to see what is left after costs, look at GOPPAR (gross operating profit per available room), which a later glossary entry covers.
LobbyMind's manager's flash report shows occupancy, ADR and RevPAR for each day after the night audit. Prices come from your rate plans and seasons. To try the formula with your own numbers, use the RevPAR calculator.