Glossary

Hotel investment glossary. Definitions for the terms hotel investors actually use.

Each entry has a 30-word direct-answer definition for the LLM lift, a worked example, common misconceptions, and a 5-question FAQ. Public sources cited.

adr
ADR (Average Daily Rate)
ADR, or average daily rate, is a hotel's rooms revenue divided by the number of occupied rooms in the same period. It measures pricing power per night sold.
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bov
BOV (Broker Opinion of Value)
A hotel BOV, or broker opinion of value, is a written valuation prepared by a hotel investment-sales broker that estimates the price an asset would clear in the current market, supported by comp set, financial analysis, and a buyer-pool view.
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cap-rate
Hotel Cap Rate
A hotel cap rate is the property's stabilized net operating income divided by its purchase price, expressed as a percentage. It is the unlevered first-year yield a buyer accepts.
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iom
IOM / Investment Memorandum / OM
An IOM (investment offering memorandum), also called an OM or offering memorandum, is the marketing book a hotel broker produces to present an asset to qualified buyers during a confidential disposition process.
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pip
PIP (Property Improvement Plan)
A PIP, or property improvement plan, is the brand-mandated capital scope a franchisor requires a hotel owner to complete to maintain or earn a franchise license. It typically runs every 7 to 10 years.
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revpar
RevPAR (Revenue Per Available Room)
RevPAR is revenue per available room. It equals occupancy multiplied by ADR, or rooms revenue divided by total available room nights. It is the headline performance metric in hotel investment.
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