Hotel Investment KPIs

 

Need to know what a hotel investment term means? Look it up in the VOJO VENTURES Glossary.

We explain definitions, terminology and industry lingo in the hospitality investment industry.

Equity to Value Ratio or Equity Ratio

Equity to Value Ratio or Equity Ratio   Calculation: Equity to Value Ratio = Total Property Equity / Total Property Value Ideal ratio: ratios below 0.5 are an indication of a heavily leveraged business   What is the Definition & Importance of ´Loan to...

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Average Mortgage Rate

Average Mortgage Rate   Calculation: Average Mortgage Rate = Sum of Mortgage Rates / Number of Mortgages   What is the Definition & Importance of ´Average Mortgage Rate´:   This KPI helps investors to evaluate if properties require refinancing....

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Loan to Value Ratio (LTV)

Loan to Value Ratio (LTV)    Calculation: LTV Ratio = Mortgage Amount / Appraised Property Value Ideal ratio: typically, 80% or lower LTV ratios will help you to obtain the most favorable / lowest rates   What is the Definition & Importance of ´Loan to...

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Average Rent Price Per Property

Average Rent Price Per Property   Calculation: Average Rent Price Per Property = Total Monthly Revenue / Total number of Properties   What is the Definition & Importance of ´Average Rent Price Per Property´:   As the name suggests, the KPI 'Average...

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Tenant Turnover

Tenant Turnover   Calculation: Turnover Rate = (Number of Tenants Moved Out / Total Number of Tenants) * 100%   What is the Definition & Importance of ´Tenant Turnover´:   This real estate KPI informs you at what rate your tenants are leaving, and...

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Payback Period

Payback Period   Calculation: Initial Capital Cost for Project / Earnings from Project or Annual Savings   What is the Definition & Importance of ´Payback Period´:   Determining the actual payback period, otherwise known as break-even, is essential...

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Operating Expense Ratio

Operating Expense Ratio   Calculation: Operating Expense Ratio = ((Total Operating Expenses – Depreciation) / Gross Revenue) * 100% Ideal ratio: below 80%   What's the Definition & Importance of ´Operating Expense Ratio´:   Using this KPI can help...

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Return on Investment (ROI)

Return on Investment (ROI) Calculation: ROI = (Investment Revenue – Investment Cost) / (Investment Cost) or ROI = (Net Profit / Total Investment) * 100%   What is the Definition & Importance of ´Return on Investment (ROI)´:   Any time you´re making an...

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