U.S. hoteliers are struggling to extend revenues in 2025, as rooms income (the most important income for accommodations) elevated by simply .8 % throughout the first half of the yr, in accordance with CBRE’s August 2025 version of Resort Horizons. Given the anticipated slowdown in U.S. lodging efficiency throughout the second half of 2025, CBRE’s forecast for the annual progress in RevPAR is simply .1 %. Due to the softer outlook for rooms income for 2025, hoteliers have centered on different sources of revenue to develop lodge revenues. One of many major sources of ancillary income has been the meals and beverage division, traditionally the second-largest income within the trade.
To investigate why meals and beverage revenues have been a shiny spot amidst declining total efficiency, we’ve analyzed the working statements of two,669 U.S. full-service, resort, and conference accommodations that participated in CBRE’s annual Developments within the Resort Trade survey in each 2023 and 2024. To offer extra present data, we relied on the month-to-month working statements of 866 properties throughout the interval January by June of 2025.
Income Developments
Since most lodge meals and beverage patrons are in-house company, we analyzed income developments on a dollar-per-occupied room (POR) foundation. In the course of the first six months of 2025, F&B income POR for the accommodations in our survey pattern elevated by 3.8 %, exceeding the three % enhance in complete lodge income throughout the identical interval.
When analyzing the expansion in F&B income POR by property sort and chain scale, important will increase throughout the first half of 2025 have been noticed at luxurious and resort accommodations. These properties have benefited from the relative energy of the leisure and bleisure demand segments for the reason that pandemic, in addition to the monetary stability of high-income households.
Properties are additionally harvesting the advantages of a post-COVID resurgence in lodge F&B demand, the place lodge eating places have been deemed safer areas. Elevated curiosity led to the hospitality trade investing in and specializing in meals and beverage, as operators and types launched extra artistic choices, personalization, and enhanced engagement. Possession centered and invested in revitalizing underutilized venues, bars, and open areas, and these investments in additional trendy ideas have been very nicely obtained by each in-house and exterior patrons.
Resort redevelopments and renovations accomplished in the previous few years included extra activated meals and beverage actual property, in lots of instances blurring the traces between foyer lounges, retail, and leisure. Homeowners shared their intentional monetary objectives for these investments with operators and have been intently measuring the ROI of those tasks. This created transparency between the operator and possession, and in the end inspired F&B groups to make extra accountable and knowledgeable selections that contribute positively to the underside line.
Refurbished bodily areas, elevated culinary packages, the utilization of information to drive flooring choices, and an total extra subtle concentrate on F&B operations additionally gave operations the boldness to extend costs. Given the very restricted progress in occupancy for the properties in our pattern, the rise in F&B income on a POR foundation will be attributable to will increase in costs and seize of exterior patrons.
Luxurious resorts have loved good points in F&B income, however conference accommodations have struggled in 2025. After benefiting from the restoration of group demand in 2023 and 2024, occupancy ranges for conference accommodations have declined in 2025. Whereas banquet income has declined at conference accommodations by 7.3 %, it has elevated at resort accommodations by 8.7 %. This might point out a choice of teams to host their assembly at resort properties, particularly throughout the offseason, when room charges will be extra favorable.
This pattern may also be attributed to the various kinds of guests that resorts and conference accommodations appeal to. There was a lower within the attendance and participation of presidency and federal staff in associations, conferences, and conferences. Organizations that depend on authorities funding have been affected by new federal insurance policies, finances reductions, and workforce shifts, leading to diminished conferences and occasions. Alternatively, the social and wedding ceremony group enterprise continues to thrive.
Meals income in each lodge venues (5.2 %) and banquet areas (4 %) has elevated in 2025. Sadly, the pattern of declining beverage revenues has carried over into the yr. From the primary half of 2024 to the primary half of 2025, beverage revenues have been flat in lodge venues however declined by 2 % at lodge banquets.
Aware ingesting has led to the emergence of two new beverage classes—low-alcohol choices and mocktail alternate options. For instance, one lodge in our pattern has reinvented the Shirley Temple, which has been successful for his or her brunch providing. Cocktail menus that have been traditionally restricted to adults at the moment are creatively providing mocktails for all the household.
Whereas minibars have registered the best proportion enhance in income from 2024 to 2025, they nonetheless signify simply .2 % of complete F&B division income. Different minor sources of F&B division income exhibiting robust progress in 2025 are public room rental (9.5 %) and repair costs (7.9 %), two gadgets which were thought-about “negotiable” prices for assembly and occasion planners, traditionally. Given the comparatively robust progress charges in these two classes, it’s clear that lodge catering and assembly gross sales managers have been extra diligent in implementing these as obligatory costs in 2025.
Bills and Income
Not solely have F&B departments contributed extra income for the accommodations in our pattern, however they’ve additionally improved the profitability of the properties. The year-to-date F&B division revenue margins for lodge F&B departments have elevated from 28.7 % throughout the first half of 2024 to 29.1 % within the first half of 2025. This means that bills have elevated at a slower tempo than revenues.
The first value classes inside a lodge F&B division are the price of items bought (i.e., meals value, beverage value), labor bills (i.e., salaries, wages, advantages), and different bills (e.g., china, silverware, linens, gear, decorations, menus). As a proportion of complete F&B division bills, labor is the best (59.4 %), adopted by the price of items bought (24 %) and different (16.6 %).
Of those three expense classes, the best proportion enhance in 2025 has been within the different class (17.3 %). Labor bills have risen by 2.1 %, whereas the price of items bought rose by 3.3 %. Tempering the rise in the price of items bought has been a discount in the price of drinks, which is commensurate with the decline in beverage revenues. Muting the rise in complete labor expenditures is a mix of changes to F&B service supply (extra buffets and grab-and-go), in addition to the continued problem of discovering staff, leading to staffing shortages.
From an asset administration perspective, occupancy bills have to be included to grasp the true profitability of an outlet and its meals and beverage operations. These bills, which embody repairs and upkeep, utilities, actual property taxes, insurance coverage, and administration charges, are official prices related to culinary areas. We are able to all the time analyze that well-positioned and profitable F&B shops have a tangible halo impact on charges, however holding operations accountable begins with a good evaluation of the profitability of every element as a standalone enterprise.
Finest Practices to Drive Income
Inns mustn’t concentrate on providing F&B bargains to draw patrons; as an alternative, they need to lean on their well-thought-out ideas, high quality of implementation, status administration, and repair supply to generate demand. Nicely-run F&B lodge shops ought to be confidently competing with native standalone eating places.
Producing extra income requires onerous work. Widespread components of profitable operations embody: delivering an enhanced client expertise, a severe strategy to menu optimization, high quality expertise, and efficient advertising and marketing. Administration should make sure that restaurant groups perceive the day by day, month-to-month, and annual objectives for every outlet. Key positions ought to be assigned particular income objectives, take part in custom-made upselling coaching programs, and make sure that acceptable incentives are in place to maintain personnel motivated and engaged. Relying in the marketplace and sort of lodge, creating an F&B advertising and marketing and gross sales supervisor place could also be a smart strategy.
