To determine the required profit after tax, it is necessary first to calculate the gross required return. Hence, to be able to generate the expected return on investment, the hotel will need to sell 9,698 room nights, or reach a 24.32% of occupancy.

There is no single "magic number," but in 2026, the threshold for hotel profitability is typically determined by the operating model and labor costs. For a traditional "limited-service" hotel (like a Hampton Inn or Holiday Inn Express), the industry standard for a "sweet spot" is often 80 to 120 rooms. This size allows the owner to spread fixed costs—such as the 24-hour front desk staff, management salaries, and building maintenance—across enough paying guests to achieve a healthy Gross Operating Profit (GOP). Smaller "boutique" or "lifestyle" hotels can be profitable with as few as 15 to 30 rooms, but they must charge significantly higher Average Daily Rates (ADR) and maintain high occupancy to offset the lack of "economies of scale." In the 2026 economy, hotels with fewer than 50 rooms often struggle unless they are family-run (minimizing labor costs) or offer a super-premium experience. Ultimately, a hotel needs enough rooms so that its Revenue Per Available Room (RevPAR) consistently exceeds its Cost Per Occupied Room (CPOR), a balance that becomes much easier to maintain as the room count increases.