Operating costs divided by the number of available rooms.
👉 What it costs you to have a room ready, whether you take care of it or not. It measures the average operating cost per room available, whether sold or not. It’s key to assessing the efficiency of a hotel’s fixed cost structure.
📊 What is CostPAR?
CostPAR stands for Cost per Available Room. This metric calculates the average cost attributed to each room that was available during a given period, regardless of whether it was occupied.
🧮 CostPAR Formula
Total operating costs ÷ Available rooms
Where:
- Operating costs: All running expenses (labour, maintenance, supplies, etc.).
- Available rooms: The full inventory available for sale during the period, sold or not
✅ Why is CostPAR important?
- It shows how fixed costs are spread across room inventory.
- Helps evaluate if your cost structure is well balanced against capacity.
- Useful for benchmarking cost efficiency regardless of occupancy levels.
📘 Practical example of CostPAR
A hotel has 100 rooms available for 30 days:
→ 100 × 30 = 3,000 available rooms
→ Monthly operating costs = €90,000
→ CostPAR = €90,000 ÷ 3,000 = €30 per available room
🔄 Difference with CPOR (Cost per Occupied Room)
While both focus on costs, CostPAR and CPOR serve different purposes:
- CPOR tells you how much it costs per room actually sold.
- CostPAR spreads costs across all rooms, even the unsold ones.
👉 Use CPOR to assess per-sale efficiency.
👉 Use CostPAR to understand overall cost sustainability.
