Occupancy (occupancy rate)

Occupancy shows how many of your available rooms were actually sold over a defined period. Formula: rooms sold divided by rooms available, times one hundred.

92% occupancy sounds strong. It is -- on one condition. The rate has to be right. A property at 92% occupancy and a USD 95 ADR earns less per available room than a property at 78% occupancy and a USD 149 ADR. RevPAR makes that difference visible: USD 87.40 in the first case, USD 116.22 in the second. Full house is not a success indicator. It is a starting suspicion.

What we see in practice: Many properties optimize for occupancy -- because the number sounds good in conversation and a full house motivates the team. That is human. But a hotel with persistently high occupancy and flat RevPAR has a pricing problem, or rather an analysis problem. The number is missing, not the will. In properties without real-time reporting, occupancy is often only read in the monthly statement -- and by that point the season is over.

Occupancy is a building block, not the answer. Read together with ADR and RevPAR, it steers. Read alone, it administers.