The Occupancy & Revenue Assumptions section will be used to project monthly occupancy and Rooms Revenue. To use general assumptions: select “Use Averages” in the dropdown at the top of the first table. The Hotel Open Month input will determine the analysis month in which rooms revenue begins. If the hotel will be closed for certain periods of the year, the Number of Days per Year input will allow the user to specify how many days in the year that the hotel will be open and receiving rooms revenue. The rooms revenue during the first year of operations will be determined using the Number of Rooms, Average Daily Rate, and Avg Occupancy (Yr 1) inputs.
Note: Monthly calculations are rounded down to the nearest whole number. For example, if in year 1 there are 235 rooms available (input in the General Info section at the top of the Inputs tab), the hotel is open for 365 days per year, and occupancy is 65%, the monthly rooms available will be 365/12Rooms Available, rounded down to the nearest whole number. Monthly rooms sold will be Monthly Rooms AvailableOccupancy, rounded down to the nearest whole number.
Monthly Rooms Available = Days Open per Year / 12 * Number of Rooms
Monthly Rooms Available = 365 / 12 * 235 = 7,147.9167 → rounded down to 7,147 rooms available
Monthly Rooms Sold = 7,147 * 65% = 4,645.5500 – rounded down to 4,645 rooms sold
Monthly Rooms Revenue = ADR * Monthly Rooms Sold
Monthly Rooms Revenue = $251.38 * 4,645 = $1,167,660.10
If “Use Monthly Detail” is selected in the dropdown, the detailed occupancy and average daily rate growth charts will become visible. In the Stabilized Occupancy by Month table, the user can enter the number of Available Rooms during each calendar month. The number of available rooms will apply to each year of the analysis. The Seasonal Occupancy % inputs represent the expected occupancy during the given calendar month.
The Seasonal Occupancy % inputs are subject to the General Occupancy by Year input values. The General Occupancy by Year is the overall occupancy during each year of operation. Operation Year 1 is the first 12 months of operations, beginning on the Hotel Open Month. The effective occupancy per month will be equal to the General Occupancy % of the given operation year multiplied by the Seasonal Occupancy % of the given calendar month. For example, given the Seasonal Occupancy inputs above and the General Occupancy inputs below, the effective occupancy during April of operation year 1 will be calculated as follows:
(General Occ %) x (Seasonal Occ %) = (60%) x (80%) = 48%
The Average Daily Rate (ADR) column inputs represent the average daily rate during each calendar month for the first year of operation. These rates will be subject to the inputs in the Detailed Avg Daily Rate Growth table. Note: If a growth rate is entered for operation year 1, the effective ADR for each month of operation year 1 will be equal to the ADR entered in the Stabilized Occupancy by Month table, increased by the operation year 1 growth rate.
