Occupancy, ADR and RevPAR build
Room nights, rate and revenue by department.
By Surojit Chakraverti, founder of L3VLUP and an investor running a long-short healthcare and technology equities strategy.
On this subject: occupancy, adr and revpar build.Updated 22 October 2026
Part of real estate models, with the models, labs and guides around it.
What it does
The revenue build of a hotel. Keys times days gives the room nights available to sell; occupancy, ramping after a renovation to a stabilised rate, gives the nights sold; the average daily rate prices them. RevPAR, occupancy times ADR, is rooms revenue per available room night and the measure every owner, operator and lender compares. Food and beverage and the other operated departments follow the guests, so they are spend per occupied room, and rentals are a share of rooms revenue.
Where it lives
The same schedule in each model that carries it, with the rows to open. Open a model in the browser, go to the sheet, and click the lines.
- Assumptions, rows 16–29: Keys, Days in the year, Occupancy, Year 1, First stabilised year…
- Assumptions, rows 32–35: Food and beverage revenue per occupied room, Year 1, Other operated departments revenue per occupied room, Year 1, Rentals and other income, % of rooms revenue, Growth in spend per occupied room and in costs, % a year
- Revenue, rows 6–13: Year, Share of the ramp to stabilised occupancy, Occupancy, Available room nights…
- Revenue, rows 16–24: Rooms revenue, Food and beverage revenue, Other operated departments revenue, Rentals and other income…
What a reviewer looks for
- Revenue grown as one line, so occupancy and rate cannot be told apart.
- Food and beverage tied to available rather than occupied rooms.
- A stabilised occupancy from the first year after a renovation.
Learn it, then build it
Vocabulary: RevPAR, Average Daily Rate (ADR), Stabilisation.