ADR Calculator - Average Daily Rate
Enter your room revenue and rooms sold to instantly calculate your Average Daily Rate (ADR), Revenue Per Available Room (RevPAR), and occupancy rate. You can also benchmark your ADR against your competitive set, estimate the revenue needed to hit a target rate, and see where your property stands against typical industry ranges. All results update as you type.
What is ADR and why does it matter?
Average Daily Rate (ADR) is the single most-watched pricing metric in the hotel and short-term rental industry. It tells you the average revenue earned for each room that was actually sold during a given period. Unlike total revenue, which grows simply by selling more rooms, ADR reveals the quality of your pricing - how much each paying guest contributed to your top line. A rising ADR with stable or growing occupancy is a strong signal that your revenue strategy is working. A falling ADR, even with high occupancy, may mean you are leaving money on the table or relying too heavily on discounted inventory.
How to calculate ADR
The formula is straightforward: ADR = Total Room Revenue divided by Rooms Sold. Only rooms that generated revenue count in the denominator - complimentary rooms, staff rooms, and vacant rooms are excluded. For example, if your property earned $15,000 from 120 rooms sold in one day, your ADR is $15,000 / 120 = $125.00. If you are calculating over a multi-day period such as a month or year, the same formula applies to the cumulative totals, and the result is an average across all those sold-room nights.
ADR vs RevPAR vs Occupancy: using all three together
ADR alone can mislead. A property charging $300 per room with 30% occupancy has the same ADR as a competitor charging $300 with 90% occupancy - but very different revenue performance. Revenue Per Available Room (RevPAR) closes this gap by multiplying ADR by the occupancy rate, so it rewards both a high rate and a full house. Occupancy rate (rooms sold / rooms available) tells you how much of your capacity you are converting to revenue. Best practice is to watch all three: occupancy identifies demand gaps, ADR measures pricing power, and RevPAR gives the composite view. The Average Rate Index (ARI) adds a fourth layer by benchmarking your ADR against a defined competitive set, so you know whether your rate premium or discount is deliberate or a gap to close.
Strategies to improve your ADR
Dynamic pricing is the most direct lever: adjust rates in real time based on demand signals, local events, lead time, and channel mix rather than setting flat seasonal rates. Upselling room upgrades at check-in and at the time of booking regularly lifts ADR by 5-15% without adding inventory. Reviewing your channel mix matters too - OTA commissions of 15-25% erode net ADR, so shifting bookings to direct channels raises the revenue you actually keep. Finally, segmenting your guests lets you offer the right rate to the right customer: leisure guests booking 60+ days out can be rate-sensitive, while last-minute business travellers tolerate a premium.
Hotel ADR benchmarks by segment (US, 2024)
| Segment | Typical ADR Range (USD) | Typical Occupancy |
|---|---|---|
| Budget / Economy | $60 - $90 | 55 - 65% |
| Midscale | $90 - $130 | 60 - 70% |
| Upper Midscale | $120 - $160 | 65 - 75% |
| Upscale | $150 - $220 | 68 - 78% |
| Upper Upscale | $200 - $320 | 70 - 80% |
| Luxury | $350+ | 65 - 78% |
Typical ADR ranges by hotel segment. Source: STR Global Hotel Report 2024. Figures are approximate US national averages.
Frequently asked questions
What does ADR mean in hotels?
ADR stands for Average Daily Rate. It is the average revenue earned per room sold during a given period, calculated as total room revenue divided by the number of rooms sold. It is the core pricing KPI used by hotels, vacation rentals, and other lodging businesses to track rate performance over time.
What is the difference between ADR and RevPAR?
ADR measures the average rate per room sold, while RevPAR (Revenue Per Available Room) measures revenue per room available, whether sold or not. RevPAR = ADR multiplied by the occupancy rate. RevPAR penalises unsold inventory, making it a more complete measure of overall revenue performance than ADR alone.
What is the difference between ADR and ARR?
The terms are sometimes used interchangeably, but they differ in what the denominator counts. ADR divides revenue by rooms sold (revenue-generating rooms only), while Average Room Rate (ARR) typically divides by rooms occupied, which can include complimentary rooms. As a result, ADR is generally higher than ARR for the same period.
What is a good ADR for a hotel?
There is no universal benchmark - a good ADR depends on your segment, market, and cost structure. As a rough guide, budget hotels in the US average $60-$90, midscale properties $90-$130, upscale hotels $150-$220, and luxury properties $350 and above. The more useful benchmark is your own historical trend and your Average Rate Index (ARI) against your competitive set.
What is the Average Rate Index (ARI)?
ARI is your ADR divided by the ADR of a defined competitive set (similar hotels in your market). An ARI above 1.0 means you are outperforming the competitive set on rate; below 1.0 means you are pricing lower than your competitors. A sustained ARI below 1.0 signals either a deliberate discount strategy or a pricing gap to address.
Does ADR include taxes, fees, and food and beverage revenue?
Standard practice is to calculate ADR using room revenue only, before tax. Revenue from food and beverage, spa, parking, resort fees, and other ancillary services is excluded. This keeps the metric focused on your core room pricing and makes it comparable across properties with different ancillary offerings.
How do I calculate ADR for a month or year?
Use the same formula with cumulative totals: add up all room revenue earned during the month or year, then divide by the total number of room nights sold over that period. The result is an average across all those nights. This calculator accepts any period - select week, month, or year and enter the period totals.