RevPAR (Revenue Per Available Rental Night)

Referred to as Revenue Per Available “Room” with hotels. RevPAR is calculated by multiplying the Occupancy by the ADR.

A critical KPI for measuring revenue performance, RevPAR takes into account both the average rate at which you booked the property (ADR) and the number of nights it was booked (Occupancy).  This provides a better indicator of overall performance when compared to looking at the ADR or the Occupancy alone.

For example, if a property is 80% occupied for available nights at a rate of $300 a night the RevPAR is $240 (80% Available Occupancy x $300 ADR).  This means that you achieved the equivalent of booking all available nights at $240 (or $87,600 for a full year). If the same property is 100% occupied for available nights for $230 a night the RevPAR is $230 (or $83,950 for a full year).

Compared to ADR or Occupancy as stand-alone metrics, RevPAR provides a more complete measure of your company’s success by giving you an overall picture of both rental revenue and occupancy.  In a single figure, RevPAR helps you understand how well your company has filed its properties both in the off-season when demand is low even though rates are also low, and in the high-season when demand is high and rates are also high.

Be mindful that in vacation rentals a 10-bedroom is likely to have a significantly higher ADR and thus RevPAR than a 2-bedroom property.  For this reason, be careful to use filters to draw appropriate conclusions when benchmarking RevPAR. For example, a comparison of RevPAR for 3 bedroom properties in a similar location vs other 3-bedroom properties in the same location may prove more insightful than a benchmarking of total RevPAR for a period inclusive of all property types.

*Note the Occupancy KPI used includes Total Nights not Available Nights

= Occupancy x ADR (or) Total Unit Revenue / Total Nights in a given period