ADR (average daily rate)
A measure of the average rate paid for rooms sold, calculated by dividing room revenue by rooms sold.(ADR = room revenue / rooms sold)
ADR (rate) index - The ADR index measures a hotel’s ADR performance relative to an aggregated grouping of hotels (e.g., competitive set, market, submarket/tract). An ADR Index of 100 equals fair share of ADR, compared to the aggregated group of hotels. An ADR Index greater than 100 represents more than a fair share of the aggregated group’s ADR performance. Conversely, an ADR Index below 100 reflects less than a fair share of the aggregated group’s ADR performance.
To calculate an ADR index: (Hotel ADR / Aggregated group of hotels’ ADR) x 100 = ADR index
Fair share can be thought of as the subject hotel’s “piece of the pie” in the market. For example, if the subject hotel’s ADR is US$50 and the ADR of its competitive set is US$50, the subject hotel’s index would total 100. If the subject hotel’s ADR totaled US$60, its index would be 120, indicating the hotel has captured more than its fair share. If the subject hotel’s ADR totaled US$40, its index would be 80, indicating the hotel has captured less than its fair share.