Our Methodology:
Room Revenue, Average Daily Rates & More

Source Strategies - Room Revenue, Occupancy, Room Counts and Hotel Quality go into our MethodologyThe Source Strategies Texas Hotel/Motel Quarterly Reports are prepared on a custom basis for private clients, including the Office of the Governor, Texas Economic Development & Tourism, and the Texas Attorney General. Reports are prepared by Source Strategies Inc. of San Antonio, Texas, based on Texas State Comptroller revenue records and independent research.

Data sources include the following:

Room Revenue: State of Texas Comptroller records are the source of taxable room revenue for all properties.  All properties exceeding $18,000 in the current quarter are included; the below-$18,000 units result in 2% of the total state revenues being initially excluded from the Source Strategies database.  As a result, the database covers 98% of Texas.

Gross room revenue (including Non-taxable) was reported to the Comptroller starting in the third quarter of 1990.  To account for the missing non-taxable revenues prior to the third quarter of 1990, Source Strategies increases each individual property’s taxable-only, reported revenues by variable factors averaging 12% to reflect this untaxed volume (e.g. government business, over 30-day stays, charitable and educational purchases). “Apartment-type” revenues are typically not reflected.

Starting in the third quarter of 1990, hotels and motels were required by the Texas Comptroller to report both taxable and gross room revenue.  Approximately 80% of properties usually comply, allowing the development of adjustment factors for all hotels and motels, even if only taxable revenues are reported.  For example, taxable room revenue is adjusted accordingly higher if a hotel reports only taxable revenue (i.e. where taxable equals gross room revenue).

Properties that make no report or only partial reports are estimated based on the past five quarter trends.  If and when they subsequently report accurately, their actual revenue ‘overwrite’ our estimates.

Room Counts: these are checked annually in chain directories and the Texas American Automobile Association Tour Book; properties checked account for approximately 80% of revenues.  For independent properties too small to be listed, the room counts reported to the state are used (unless they appear unreasonable; if so, a telephone contact is made).

As a result, the ‘CHAIN’ occupancies and room counts appear to be very close to ‘actual’, while independent room counts could be slightly overstated. Reports are split into CHAIN and INDEPENDENT categories.

Average Daily Rates are estimated with the aid of financial reports, appraisers, private S.S.I. surveys, chain and AAA directories and another reliable industry database.

Roomnights Sold are derived from the above revenues, divided by Average Daily Rates.  Roomnights available are calculated from Room Counts (times days in the period).

Occupancy is calculated from roomnights sold and roomnights available.  All occupancy figures reported represent fully weighted averages, as calculations are always made after sub-totaling or totaling roomnights sold and roomnights available.

“CHAINS” are defined as one of the “Top 70+” brands, and include the following names: Four Seasons, Gaylord, Westin,  W, Hilton, Hyatt, Inter-Continental, Marriott, Omni, Renaissance, Wyndham, Embassy, Homewood, Residence, Staybridge, Clarion, Courtyard, Crowne Plaza, Indigo, Doubletree, Hilton Garden, Holiday Inn, Radisson, Sheraton, AmeriSuites, Bradford, Candlewood, Comfort Suites, Hawthorn, Quality Suites, SpringHill, TownPlace, Amerihost, Baymont, Best Western, Comfort Inn, Country Inn, Drury, Fairfield, Hampton, Holiday Express, La Quinta, Wingate, Budget Suites, Extended Stay, Homestead Village, Intown, Value Place, Studio Plus, Studio 6, Best Value, Days, Econo Lodge, Howard Johnson, Microtel, Motel 6, Quality Inn, Ramada, Red Roof and Super 8.

Accuracy: Room counts and Room Revenues are within 2%. On an overall basis, the change in average daily rates reported by Source Strategies Inc. are within a few tenths of one-percent of PKF Trends, another private research firm that gets financial reports from about 30% of all hotel/motels in Texas and then publishes aggregated results by metro and smaller areas.