Hotel profitability margins fall as room revenue growth slows and labor expenses increase

Many hotels are currently or about to embark on budgeting for 2025, and a prominent topic is hotel profitability. Hotel room revenue per available room, or RevPAR, has slowed to 1.1% year-to-date through July, compared to 7.4% during the same period last year. RevPAR is a key performance indicator in hospitality that combines occupancy and average daily rate.