{
  "slug": "hotel-breakeven-occupancy",
  "title": "Hotel Breakeven Occupancy Calculator",
  "heading": "Hotel Breakeven Occupancy Calculator",
  "category": "financial",
  "url": "https://www.revenuelab.fyi/toolbox/hotel-breakeven-occupancy",
  "summary": "The occupancy percentage where room revenue covers fixed and variable costs.",
  "description": "Every hotel has a fixed monthly cost load — debt service, insurance, base staffing, property tax, management fee minimums — that has to be covered regardless of how many rooms sell. Breakeven occupancy is the occupancy percentage at which room revenue exactly covers fixed costs plus the variable cost of each occupied room (housekeeping, guest supplies, utilities tied to occupancy). Below this line the property loses money even with positive ADR; above it, every incremental room sold drops mostly to profit since fixed costs are already covered. This calculator takes your monthly fixed costs, ADR, and variable cost per occupied room to compute both the breakeven occupancy percentage and how many room-nights that represents.",
  "formula": "Breakeven Occupancy % = Fixed Costs ÷ (Rooms Available × (ADR − Variable Cost per Room)).",
  "dateModified": "2026-09-30",
  "run_url": "https://www.revenuelab.fyi/api/public/calc?tool=hotel-breakeven-occupancy",
  "inputs": [
    {
      "id": "fixedCosts",
      "label": "Monthly fixed costs",
      "kind": "number",
      "hint": null,
      "default": 145000,
      "unit": "$",
      "min": 0,
      "max": null
    },
    {
      "id": "rooms",
      "label": "Total rooms",
      "kind": "number",
      "hint": null,
      "default": 120,
      "unit": null,
      "min": 1,
      "max": null
    },
    {
      "id": "days",
      "label": "Days in month",
      "kind": "number",
      "hint": null,
      "default": 30,
      "unit": null,
      "min": 1,
      "max": null
    },
    {
      "id": "adr",
      "label": "ADR",
      "kind": "number",
      "hint": null,
      "default": 140,
      "unit": "$",
      "min": 0,
      "max": null
    },
    {
      "id": "variableCost",
      "label": "Variable cost per occupied room",
      "kind": "number",
      "hint": null,
      "default": 32,
      "unit": "$",
      "min": 0,
      "max": null
    }
  ],
  "outputs": [
    {
      "id": "breakevenOcc",
      "label": "Breakeven occupancy",
      "format": "percent",
      "hint": null,
      "primary": true
    },
    {
      "id": "breakevenRooms",
      "label": "Breakeven room-nights",
      "format": "number",
      "hint": null,
      "primary": false
    },
    {
      "id": "contribution",
      "label": "Contribution margin per room",
      "format": "currency",
      "hint": null,
      "primary": false
    },
    {
      "id": "marginOfSafety",
      "label": "Margin of safety at 100% occupancy",
      "format": "percent",
      "hint": null,
      "primary": false
    }
  ],
  "worked_example": {
    "inputs": [
      "Monthly fixed costs: 145000 $",
      "Total rooms: 120",
      "Days in month: 30",
      "ADR: 140 $",
      "Variable cost per occupied room: 32 $"
    ],
    "outputs": [
      "Breakeven occupancy: 37.3%",
      "Breakeven room-nights: 1,343",
      "Contribution margin per room: $108.00",
      "Margin of safety at 100% occupancy: 62.7%"
    ]
  },
  "how_to": {
    "title": "How to use this",
    "steps": [
      "Enter monthly fixed costs ($).",
      "Enter total rooms.",
      "Enter days in month.",
      "Enter adr ($).",
      "Enter variable cost per occupied room ($).",
      "Read your breakeven occupancy on the right — it updates as you type.",
      "Hit Share to keep the scenario or send it to someone."
    ]
  },
  "scenarios": [
    {
      "name": "Conservative",
      "description": "Lower-end numbers — what if things land soft?",
      "values": {
        "fixedCosts": 87000,
        "rooms": 72,
        "days": 18,
        "adr": 84,
        "variableCost": 19
      }
    },
    {
      "name": "Typical",
      "description": "Defaults — the most common real-world setup.",
      "values": {
        "fixedCosts": 145000,
        "rooms": 120,
        "days": 30,
        "adr": 140,
        "variableCost": 32
      }
    },
    {
      "name": "Ambitious",
      "description": "Higher-end numbers — what if things really pop?",
      "values": {
        "fixedCosts": 232000,
        "rooms": 192,
        "days": 48,
        "adr": 224,
        "variableCost": 51
      }
    }
  ],
  "limitations": [
    "Results are estimates before tax, fees, and inflation unless an input explicitly covers them.",
    "Rates are treated as fixed for the whole period — variable-rate products will drift from this projection.",
    "This is educational maths, not financial advice. Check anything contractual with the lender or your accountant."
  ],
  "faq": [
    {
      "q": "What counts as a fixed cost in this calculation?",
      "a": "Debt service, property insurance, real estate tax, base management fee, and the minimum staffing levels required to open the doors regardless of occupancy — front desk, night audit, basic security. These don't scale down meaningfully even at very low occupancy."
    },
    {
      "q": "What's a realistic breakeven occupancy for a hotel?",
      "a": "Most limited-service hotels break even somewhere between 35% and 50% occupancy depending on leverage and ADR. Heavily-financed, newly built properties with high debt service can run breakeven closer to 55-60%, which is a dangerous place to be in a soft demand cycle."
    },
    {
      "q": "How does ADR affect breakeven occupancy more than you'd expect?",
      "a": "Because breakeven occupancy is inversely related to the contribution margin (ADR minus variable cost), a $10 ADR increase on a $140 rate with $32 variable cost raises contribution margin by roughly 9%, which lowers breakeven occupancy by nearly that same percentage — rate moves breakeven faster than volume does."
    },
    {
      "q": "Should variable cost per room include commissions?",
      "a": "Yes if a meaningful share of bookings come through OTAs. A property paying 18% OTA commission on a $140 ADR room is losing about $25 of that room's revenue before variable service costs are even counted, which materially raises the true breakeven point."
    }
  ],
  "related": [
    "https://www.revenuelab.fyi/toolbox/hotel-revpar-calculator",
    "https://www.revenuelab.fyi/toolbox/hotel-goppar-calculator",
    "https://www.revenuelab.fyi/toolbox/ota-commission-vs-direct-booking"
  ],
  "license": "CC-BY-4.0",
  "citation": "RevenueLab — Hotel Breakeven Occupancy Calculator (https://www.revenuelab.fyi/toolbox/hotel-breakeven-occupancy)"
}