Rooms

Keys

ADR Average daily rate

Occupancy %

Other revenue % of rooms F&B, parking, spa

Departmental expenses

The way a hotel P&L is actually presented: rooms costs against rooms revenue, other-department costs against other revenue.

Rooms expense % of rooms revenue

Other dept expense % of other revenue

Undistributed % of total revenue Admin, sales, utilities, repairs

Fees and reserve

The three lines that most RevPAR calculators ignore entirely, and that together take a fifth of revenue.

Franchise and brand fees % of rooms

Management fee % of total revenue

FF&E reserve % of total revenue

Value it

Cap rate %

Hotel net operating income

—

After departmental costs, undistributed expenses, fees and the FF&E reserve.

Rooms performance

RevPAR—

Rooms revenue—

Other revenue—

Total revenue—

Occupied room nights—

NOI margin—

Down the P&L

Rooms department expense—

Other department expense—

Undistributed expenses—

Franchise and brand fees—

Management fee—

FF&E reserve—

Value at cap rate—

Value per key—

Hotel inside a mixed-use deal?

The full Rental Deal Analyzer models a hotel component alongside apartments and commercial space, with an occupancy ramp, ADR growth, and the hotel NOI flowing into the property value, the debt metrics and every return.

Open the full model free

No credit card. One saved project on the free plan.

RevPAR is where hotel analysis starts, not where it ends

Revenue per available room is ADR multiplied by occupancy — it spreads revenue across every room you have, not just the ones you sold, which is what makes it comparable between hotels. It is also a single multiplication, which is why there are so many free calculators for it and why none of them tell you much.

What matters when you are buying is NOI, and between RevPAR and NOI sit six deductions that a RevPAR calculator never shows you.

The departmental structure

Hotel P&Ls are presented by department. Rooms expense — housekeeping, front desk, linen, commissions — is charged against rooms revenue and usually lands at 25–30%. Other departments like food and beverage run far thinner margins, often 70% cost or worse, which is why a hotel with a big restaurant is not necessarily a better business.

Undistributed expenses

Administrative, sales and marketing, utilities, and property operations and maintenance cannot be assigned to one department, so they come off total revenue. Around 22% is typical for a select-service property.

The three that get forgotten

Franchise and brand fees — royalty, marketing and reservation fees against rooms revenue. Often 8–11% in total, and a flag is not optional on most financeable hotels.
Management fee — 2–4% of total revenue to the operator, plus an incentive fee in many contracts. Even an owner-operator should charge it, because a buyer will.
FF&E reserve — 4–5% of revenue set aside for the renovation cycle. Lenders and brands require it, and a P&L without it overstates NOI by exactly that much.

Together those three take roughly 15–20% of total revenue. A seller’s pro forma that omits the reserve, or shows the owner managing for free, is overstating value by a multiple of the omission.

One thing to be careful of

Property taxes and insurance are not in the ratios above, to match how the full model treats a hotel inside a mixed-use property — they sit in the property-level operating budget instead. For a standalone hotel, subtract them from the NOI shown here before you value it.

This is a calculation tool, not advice. Every result depends entirely on the assumptions you enter — verify them before acting on a deal.

Hotel RevPAR and NOI calculator