RevPAR is revenue per available room. You take total room revenue for a period and divide it by the number of rooms available times the number of nights, so a 42-room hotel over 30 nights has 1,260 available room-nights. Occupancy times average daily rate gets you the same figure, which is why your math lines up.
It gets the headline because occupancy and rate move against each other. An operator can push occupancy to 80% by cutting rate to $70, and that looks like a better hotel on one line and a worse one on the other. RevPAR is the single number that tells you whether the trade was worth making. Two hotels at $58 RevPAR are earning the same room revenue per room they own, however they got there.
And no, it's room revenue only. Breakfast, the meeting room, parking, vending, all of that sits outside RevPAR. Some brokers quote TRevPAR, total revenue per available room, which folds those in. If a flyer switches between the two without saying which, ask.
The part people miss on their first hotel flyer: RevPAR is a top-line figure and hotels have very high operating expense ratios, often 65 to 75 percent of revenue at limited service, higher with food and beverage. Housekeeping, front desk, franchise fees, and a reserve for replacing furniture and soft goods all come out before you see anything. Ask for the last three years of profit and loss statements by month, because a highway hotel's summer and February look nothing alike.
