An STR report is one of the most important benchmarking tools in the hotel industry. It tracks core performance metrics like occupancy, average daily rate (ADR), and RevPAR, and it’s something every serious hotel buyer expects to see early in a transaction.
But buyers don’t just glance at your RevPAR index and move on. They dissect it.
The STR report is often one of the first tools a buyer uses to decide whether a hotel is a stable, well-performing asset—or a project with unanswered questions. When framed correctly, it can protect value, reduce uncertainty, and build confidence in your numbers. When framed poorly, it can do the opposite.
A single number doesn’t tell the whole story. Context matters.
I was recently on the phone with the owner of an 85-room midscale franchise in a secondary market. He emailed me his latest STR report and asked a straightforward question:
“Chase, my RevPAR index is around 104. Is that good enough to get a strong price?”
On paper, it looked fine—slightly outperforming the comp set. But when I dug deeper, a different picture emerged:
- • The index had bounced between 92 and 108 over the past couple of years
- • There were significant month-to-month swings
- • The comp set included one newer hotel and one clear outlier
From the owner’s perspective, the logic was simple: Above 100 means I’m winning. From a buyer’s perspective, it raised questions: Is this sustainable? Is the comp set right? Is this performance number an indication of management skill, or just noise?
If you own a franchise hotel, you’ve probably had the same moment: staring at your STR report and wondering whether it helps you or hurts you when it’s time to sell.
What buyers are really trying to figure out: they’re rating the hotel’s performance, not yours.
When a serious buyer reviews your STR report, they’re not judging you personally. They’re trying to answer a few big questions quickly:
- • Is this hotel keeping up with the market, beating it, or lagging?
- • Are these numbers sustainable, or are they the result of a short-term spike?
- • Is this a management story, a brand story, or a market story?
- • What happens if we apply our own management and revenue strategy?
As a seller, you should understand how buyers think. A RevPAR index over 100 is good—but if it’s recent and choppy, buyers get cautious. A slightly underperforming hotel with clear reasons for its performance and potential for upside can be more attractive than a “heroic” index that looks like a fluke. A weak or unrealistic comp set can instantly damage your credibility with a buyer.
In hotels, what gets measured and explained gets valued. STR is one of the first measurements buyers evaluate when they’re considering an acquisition.
How Broker Looks at STR
Because I’m involved in hotel transactions every day, I don’t treat an STR report as a report card. I treat it as the plotline of a story. When I review an STR for a potential sale, I focus on four things:
- 1. Trend – Is performance improving, declining, or simply drifting with the market?
- 2. Index – How does the hotel stack up against the comp set, and is that comp set credible?
- 3. Consistency – Do the numbers follow a logical pattern, or bounce unpredictably?
- 4. Alignment – Do STR results match the P&L and what’s happening in the broader market?
Buyers ask the same questions—just with a more skeptical eye. The goal is to make those questions easy to answer.
The Four Lenses Buyers Use on Your STR
Lens 1: Trend Over Time
Buyers typically review three to five years of data, with particular focus on the most recent 12 to 24 months. They’re looking for answers to questions like:
- • Is RevPAR trending up, flat, or down versus the comp set?
- • How did the hotel perform during market disruptions?
- • Are there clear explanations for dips or spikes?
A smooth, slightly upward trend with context is often more reassuring than dramatic swings—even if the peak year looks impressive.
Lens 2: Index Versus a Credible Comp Set
An index of 110 against a weak comp set is less valuable than an index of 98 against a tight, believable one. Buyers want to know:
- • Are these hotels truly comparable in age, brand, location, and demand mix?
- • Is there a property that clearly skews the results?
- • If one or two hotels were swapped, would the story fall apart?
If a comp set feels padded to make performance look better, underwriters will catch it—and trust erodes quickly.
Lens 3: Mix and Consistency
Buyers also study how performance is generated:
- • Weekend versus weekday strength
- • Group versus transient mix
- • Seasonal patterns
They want to know whether strong months reflect real out-performance or simply seasonal demand. Repeatable, logical patterns signal durability.
Lens 4: Does the Story Make Sense?
Finally, buyers compare the STR data to what they’re hearing from ownership:
- • “We renovated in 2023.” Do the numbers improve afterward?
- • “We lost a major account last year.” Is that visible in the data?
- • “The market has been tough, but we’re holding our own.” Does the index support that?
When the narrative and the STR align, buyers relax. When they don’t, buyers protect themselves with discounts and contingencies.
