{"id":927,"date":"2025-12-17T21:44:29","date_gmt":"2025-12-17T20:44:29","guid":{"rendered":"https:\/\/torreshospitalityconsulting.com\/?p=927"},"modified":"2025-12-17T21:44:31","modified_gmt":"2025-12-17T20:44:31","slug":"what-can-you-learn-about-ancillary-revenue-from-the-empire-state-building","status":"publish","type":"post","link":"https:\/\/torreshospitalityconsulting.com\/en\/2025\/12\/17\/what-can-you-learn-about-ancillary-revenue-from-the-empire-state-building\/","title":{"rendered":"What can you learn about Ancillary Revenue from the Empire State Building?"},"content":{"rendered":"

The Empire State Building earns over $500 million annually<\/strong>, and only ~70%<\/strong> of that comes from office space. The rest? Ancillary revenue<\/strong>. Observation decks, antenna leasing, broadcasting rights\u2026even during economic downturns, these vertical revenue streams sustained the business.<\/p>\n\n\n\n

Lesson for hotels<\/strong>: Don't depend solely on rooms. Monetize every square meter <\/em>and every guest interaction<\/em>.<\/p>\n\n\n\n

Real Estate? No. It's Real Strategy<\/h3>\n\n\n\n

Let's unpack how this applies to hotels and resorts<\/strong>:<\/p>\n\n\n\n

\"Article<\/figure>\n\n\n\n

Ancillary Revenue in Hotels: The data doesn't lie<\/h3>\n\n\n\n

From my book \u201cMastering Hospitality Ancillary Revenue\u201d<\/em>, here's how modern hotels can emulate the Empire State strategy<\/strong> using rooms and F&B data<\/strong> (no need for observation decks or antennas).<\/p>\n\n\n\n

1. TRevPAR (Total Revenue per Available Room)<\/h3>\n\n\n\n

A powerful metric to track all revenue streams attributed to rooms: including F&B, room upgrades, minibar, etc. If your TRevPAR is only marginally above your ADR, it means guests aren't engaging with other services.<\/p>\n\n\n\n

Action<\/strong>: Use upselling tools and mobile check-in prompts to offer upgrades, F&B packages, or exclusive in-room dining experiences.<\/p>\n\n\n\n

2. F&B RevPOR (F&B Revenue per Occupied Room)<\/h3>\n\n\n\n

This reveals how much each in-house guest is spending on food and drinks. If you're averaging \u20ac18 but your outlets have a high check average of \u20ac35, many guests are skipping your F&B offering entirely.<\/p>\n\n\n\n

Action<\/strong>: Identify guest segments by meal preference (breakfast-only vs. full-board potential) and retarget with tailored offers and promos.<\/p>\n\n\n\n

3. RevPASM (Revenue per Available Seat Minute in F&B)<\/h3>\n\n\n\n

Inspired by airline revenue logic, this metric helps you understand how well you're monetizing your dining space per seat, per minute of opening time<\/strong>.<\/p>\n\n\n\n

Action<\/strong>: Reduce dwell time during peak hours with smart table management and offer timed menus (eg express lunch menus) to increase table turnover.<\/p>\n\n\n\n

4. Room Upsell Conversion Rate<\/h3>\n\n\n\n

Not every guest needs a suite, but many will pay for a better view or late check-out. This KPI tracks the effectiveness of your upselling strategy<\/strong>.<\/p>\n\n\n\n

\u2192 Action<\/strong>: Integrate dynamic pricing tools into your PMS or booking engine to automate and personalize upsell offers based on demand and guest profile.<\/p>\n\n\n\n

5. GOPPAR (Gross Operating Profit per Available Room)<\/h3>\n\n\n\n

Just like the Empire State Building earned big from low-cost operations (TV antennas, rooftop tickets), this metric reveals which room categories and services generate the most profit<\/strong>not just revenue.<\/p>\n\n\n\n

Action<\/strong>: Compare GOPPAR across room types and F&B outlets. Reallocate marketing spend to boost high-margin products.<\/p>\n\n\n\n

What's the Hospitality version of a TV antenna?<\/h3>\n\n\n\n

Here are Empire State-style ancillary ideas<\/strong> for hotels in 2025\/26:<\/p>\n\n\n\n