ARI (Average Rate Index)

ARI (Average Rate Index) measures a hotel's ADR performance relative to its competitive set. It shows whether the property is charging more or less than its peers.

Formula

ARI = (Hotel ADR / Comp Set ADR) × 100

Interpretation

• ARI = 100 — ADR matches the comp set average.
• ARI > 100 — The hotel is pricing above the comp set.
• ARI < 100 — The hotel is pricing below the comp set.

Example

Your ADR is $220 while the comp set ADR is $200. ARI = (220 / 200) × 100 = 110, meaning you're priced 10% above the market.

Why it matters

ARI is a leading indicator of pricing power. A consistently high ARI combined with a high MPI is the strongest signal of a healthy property — it means you're filling rooms and charging a premium. ARI is part of the STR index trio with MPI (occupancy) and RGI (revenue).