Key takeaways
- TRevPAR is total revenue from all departments per available room. Use it alongside RevPAR to see a hotel's business model.
- The TRevPAR/RevPAR ratio shows whether a hotel is room-led or an integrated resort.
- Use net operating revenue, excluding interest, foreign exchange gains and gains on asset sales.
Modern hotels earn revenue from many departments, so looking at RevPAR alone is not enough to assess revenue-generating potential. TRevPAR covers every department and reflects the business model better.
1. What is TRevPAR?
TRevPAR = Total Hotel Revenue ÷ Total Rooms Available
= (Room + F&B + Spa + OOD + Other) ÷ (Rooms × Days)
- RevPAR uses room revenue only
- TRevPAR uses total revenue from all departments, and is never lower than RevPAR when the same denominator is used
2. Example 1: a 100-room hotel
Available rooms: 100 × 365 = 36,500 room-nights
| Department | Revenue (THB million) | Proportion |
|---|---|---|
| Room Revenue | 200 | 71.4% |
| F&B Revenue | 50 | 17.9% |
| Spa Revenue | 20 | 7.1% |
| Mini-bar / Laundry (OOD) | 10 | 3.6% |
| Total Revenue | 280 | 100% |
- RevPAR = 200,000,000 ÷ 36,500 = THB 5,479
- TRevPAR = 280,000,000 ÷ 36,500 = THB 7,671
TRevPAR is about 40% higher than RevPAR. F&B and spa account for 25% of total revenue.
3. Example 2: comparing two hotels
| Metric (example) | Room-led | Integrated Resort |
|---|---|---|
| RevPAR (THB) | 8,000 | 8,000 |
| TRevPAR (THB) | 8,800 | 13,000 |
| TRevPAR / RevPAR | 1.10x | 1.63x |
RevPAR is the same, but the integrated resort generates about 48% more total revenue per room. This does not automatically mean higher profit, because the other departments have different costs. Read on to GOP.
4. Why use both
RevPAR: Rate Strategy
- Measures the Rooms department only
- Used to compare pricing strategy and OCC
- The standard metric in market reports
TRevPAR: Business Model
- Measures total guest spending per room-night
- Reflects upsell and cross-sell
- Shows whether the hotel is room-led or resort-integrated
5. Benchmarks by tier
Illustrative figures for educational purposes. Actual values vary by market.
| Hotel level | RevPAR | TRevPAR | Ratio |
|---|---|---|---|
| Budget / Limited Service | 1,200 | 1,400 | 1.17x |
| Midscale 3-star | 2,500 | 3,200 | 1.28x |
| Upscale 4-star | 4,500 | 6,500 | 1.44x |
| Luxury 5-star | 9,000 | 15,000 | 1.67x |
| Ultra-Luxury | 15,000 | 28,000 | 1.87x |
| Resort with Spa & F&B | 8,000 | 18,000 | 2.25x |
- 1.1x–1.3x: room-led property
- 1.5x–1.7x: luxury hotels with strong F&B and spa
- Above 2.0x: integrated resort destinations
6. Breaking down TRevPAR to find optimisation
TRevPAR 7,671 = RevPAR 5,479 + F&B 1,370 + Spa 548 + OOD 274
| Strategy (example) | Effect on TRevPAR (THB) |
|---|---|
| Raise F&B capture rate from 50% to 70% | +260 |
| Spa packages bundled with rooms | +500 |
| Broaden the mini-bar range | +50 |
| Wellness package add-on | +700 |
| Total potential | +1,510 |
If all are delivered, TRevPAR rises from THB 7,671 to THB 9,181, growth of 19.7%, without adding rooms or pushing ADR.
7. Strategic framework
Room-Led
- Focus on rate and occupancy
- F&B and spa are supporting services
- Ratio of 1.1–1.3x
- Pros: simple operations, low investment
- Cons: limited revenue ceiling
Integrated Resort
- Build multiple revenue streams
- F&B and wellness are destinations in their own right
- Ratio of 1.7–2.5x
- Pros: high revenue per guest and support in the low season
- Cons: high CAPEX and a need for specialist staff
Phased Hybrid
- Years 1–3: build the rooms operation base
- Years 4–6: invest in signature F&B
- Year 6 onwards: design wellness packages bundled with rooms
- Target: 1.1x in year one, rising to 1.5x within 10 years
8. Points to watch
- Use operating revenue only, excluding interest income, foreign exchange gains and gains on asset sales
- Use net revenue after VAT and service charge when comparing against benchmarks
- Long-stay or corporate rates may lower RevPAR, but TRevPAR does not fall in step
- Compare TRevPAR only within the same segment
9. Monitoring
- Daily: revenue by department against forecast
- Monthly: variance to budget, department contribution, compset
- Quarterly: trend in the ratio, cross-sell, pricing strategy and revenue mix
10. Conclusion
TRevPAR is a mirror of a hotel's business model. Used alongside RevPAR, it shows both how efficiently rooms are sold and the potential to create value from each guest. Executives should balance rate, occupancy and guest spending, and read on to the profit of each department.