What is TRevPAR (Total Revenue Per Available Room)?
TRevPAR, or Total Revenue Per Available Room, is a hospitality metric used to assess a property's overall financial performance. It calculates the total revenue generated from all departments—including accommodation, cleaning fees, pet fees, and ancillary services—per available room.
Unlike RevPAR, which only considers room revenue, TRevPAR provides a more holistic view of a property's ability to generate income. The formula is: Total Revenue / Total Available Rooms.
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How it works
To calculate TRevPAR, a property manager first defines a specific time period, such as a day, week, month, or year. Next, they sum all revenue generated by the property during that period.
This includes the nightly rate plus any additional income from sources like extra guest fees, late check-out fees, upselling services like tours or equipment rentals, and cleaning fees. This total revenue figure is then divided by the number of available rental units during the same period.
The resulting amount is the TRevPAR, which can be monitored over time to evaluate the effectiveness of revenue management strategies.
Why it matters
TRevPAR is important because it provides a comprehensive measurement of a property's total revenue-generating capability, beyond just room occupancy and rates. It highlights the financial impact of ancillary services and upselling, encouraging hosts to diversify their income streams.
By focusing on total revenue, managers can make more strategic decisions about pricing, marketing, and guest services to maximize the profitability of each available unit, whether it's occupied or not.
Examples
- A manager of a 10-unit aparthotel tracks monthly TRevPAR. After introducing paid options for early check-in and luggage storage, they observe a 15% increase in TRevPAR, even though occupancy rates remained stable, confirming the success of the new services.
- The owner of a lakefront cabin with a pontoon boat compares TRevPAR for July and August. August has a higher TRevPAR despite having the same nightly rate and occupancy, because more guests paid the extra fee to rent the boat, indicating that promoting the boat rental is a key revenue driver.
- A host with two similar properties compares their TRevPAR. Property A has a higher TRevPAR because it successfully upsells welcome baskets and mid-stay cleaning services. The host decides to implement the same upselling strategies for Property B to boost its overall revenue.
- To analyze the impact of a new pet policy, a host calculates TRevPAR for the quarter before and after allowing pets for a $50 fee. The metric shows a significant increase, demonstrating that the revenue from pet fees outweighs any potential drop in bookings from guests with allergies.
Frequently asked questions
What is the main difference between TRevPAR and RevPAR?+
How can I increase my property's TRevPAR?+
How do I calculate TRevPAR for my properties?+
Is TRevPAR more useful than Average Daily Rate (ADR)?+
Related terms
RevPAR (Revenue Per Available Room)
RevPAR is a key performance metric that measures a property's ability to generate revenue from its entire inventory of available rooms.
Average Daily Rate (ADR)
Average Daily Rate (ADR) is a key performance metric that measures the average rental revenue earned for an occupied property per day.
Revenue Management
Revenue management is the strategic process of using data analytics to predict consumer behavior and optimize pricing and inventory availability to maximize…
Occupancy Rate
Occupancy Rate is the percentage of booked nights out of the total available nights for a property over a specific period.
