Net RevPAR (Net Revenue per Available Room) is a hotel revenue management metric that measures net room revenue per available room night after deducting specified distribution costs, such as commissions and booking-related acquisition costs.
The exact definition can vary between hotels, so the costs included should always be clearly specified.
Formula
Net RevPAR = (Room Revenue − Defined Distribution Costs) ÷ Available Room Nights
Practical Example
A hotel has 200 available room nights and generates CAD 30,000 in room revenue. It incurs CAD 3,000 in distribution costs included in its calculation.
Net Room Revenue = CAD 30,000 − CAD 3,000 = CAD 27,000
Net RevPAR = CAD 27,000 ÷ 200 = CAD 135
The hotel’s Net RevPAR is CAD 135 per available room night.
How to Interpret Net RevPAR
Net RevPAR helps hotels evaluate room revenue after accounting for specified distribution costs. It can reveal differences in the economic value of bookings made through direct channels, online travel agencies (OTAs), and other distribution sources.
A hotel may achieve a higher ADR or RevPAR while generating lower net room revenue if distribution costs are significantly higher.
For meaningful comparisons, hotels should apply a consistent definition of net revenue and include the same categories of costs.
Related Terms
RevPAR · ADR · OTA · Direct Booking · Distribution Channel · Contribution Margin · Channel Manager