#hotelfinance

Many hoteliers rely on traditional metrics like EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) to assess profitability. But what if I told you there’s a better way to understand the true earning potential of your hotel?

Enter EBITDAR—a lesser-known but highly effective financial metric that provides a clearer picture of a hotel's operational performance.

Unlike EBITDA, EBITDAR accounts for one of the biggest expenses in the hospitality industry—rent. Since many hotels lease their properties, ignoring rent costs can give a misleading picture of actual profits.