Actual Share

The percentage of room nights or revenue that a hotel captures from its competitive set is called the actual share. This metric is calculated by dividing the total room nights the hotel sold by the total room nights sold by the hotel’s comp set. Competitive sets are normally chosen based on similar physical characteristics, ADR, location, group versus transient mix, and a host of other factors. The number of hotels in a competitive set depends on the property and the supply within the local market. Having a competitive set isn’t always a bad thing. “I know of developers 15 to 20 years ago that were looking at property locations near highway off-ramps knowing and wanting hotels to develop near them,” says Joseph Smith, executive vice president of Chesapeake Hospitality. “That’s because hotels tend to breed other customers and services to address their needs.” In other words, baking a bigger pie can result in larger slices.