What is GOPPAR?
It is the number owners and investors use, because a hotel can break RevPAR records and still lose money if costs grow faster than revenue.
How it is calculated
- Formula: gross operating profit ÷ available rooms.
- Gross operating profit: total revenue − operating costs, before rent, depreciation, interest and tax.
- Example: €186,000 of operating profit across 930 available rooms gives a GOPPAR of €200.
What is the difference between RevPAR and GOPPAR
RevPAR measures how much comes in from accommodation; GOPPAR, how much is left after paying to produce it. A hotel can lift RevPAR by 8% with a campaign that sends its acquisition cost through the roof and watch its GOPPAR fall. They are two different questions and it is better not to mix them.
What it is for
- Deciding where to squeeze: it tells you whether the problem is on the revenue side or in the cost structure.
- Comparing properties under the same ownership: it neutralises the effect of size.
- Justifying investment: it is the number the person putting up the money looks at.