Spas are an expected amenity for most luxury and ultra luxury hotels, and properties with savvy operators are benefiting greatly from luxury travelers increasingly willing to spend on spa. Spas are also mandatory under the brand standards for certain luxury and ultra-luxury brands, as well as a requirement to comply with Forbes Five Star Standards.
Spa departments can also be found in a variety of hotel property types beyond just luxury resorts, as hotels of all types around the world are enhancing their spa offerings to promote overall wellness and mental health for their guests. Urban hotels offer spas to accommodate demand from residents, while the presence of a spa is often a requirement for large convention hotels to win group business. At small, luxury boutique hotels, spas are often the primary amenity offered, and modest-priced family resorts may offer spas to satisfy the needs of parents while the kids play in the water park.
To assess the impact of hotel spa departments on overall property operations, we analyzed the performance of 297 U.S. hotels that operate a spa and participated in CBRE’s Trends® in the Hotel Industry survey in 2023 and 2024. In 2024, these 297 hotels averaged 381 rooms in size, a 65.1% occupancy, and a $375.64 average daily rate (ADR). The sample consisted of 222 properties located in resort markets, and 75 operating in urban areas, and the majority (176) of properties were luxury hotels, while the remainder operated in the upper-upscale, upscale, and upper-midscale class categories. Excluded from this analysis were hotels that leased out their spa operations to third party operators (i.e. an operator outside of the hotel management company).
Revenue
In 2024, the hotels in our research sample averaged $6,061 per available room (PAR) in spa revenue, which incorporates revenue from all spa services including massages, body treatments, salon services, and retail sales. Spa revenues PAR is greatest at hotels located in resort areas ($6,539) versus urban areas ($4,756), and luxury hotels ($9,847) earn more than upper-upscale ($3,197) and upscale/upper-midscale ($3,467) properties. These relative revenue trends are the same when measuring revenue on a dollar per occupied room basis.
The relative financial impact of spas can be measured by analyzing spa revenue as a percentage of total hotel revenue. On average, spa revenue at the hotels in our sample averaged 3.4% of total revenue during 2024. Spas were the greatest contributor of revenue at luxury hotels (4.2%) and properties in resort locations (3.5%).
Figure 1: Spa Revenue as a Percent of Total Revenue *Note: Hotel operated. Leased spa operations not included. — Source: Source: CBRE Hotels Research, Trends® in the Hotel Industry – Same store sample of properties that self-operated a spa 2023 and 2024.
Among the various treatments and services offered by hotel spas, massages represent upwards of 60% to 75% of the revenue generation and number of treatments; however, its other specialty services that are used to increase traffic and elevate the positioning of a property. Resorts and ultra-luxury properties are incorporating specialized offerings from immunity support, nutrition, anti-aging treatments, mental health and hydrotherapy. Beachside or poolside spa cabanas are an excellent way to increase the visibility of the spa to increase guest capture.
The most popular trend in spa and wellness today are contemporary bathhouses – combining old-world bathhouses concepts and traditional bathing rituals with modern spa services. Bathhouses also bring a communal element to spa usage, which can lead to increased traffic and repeat business.
Adding thoughtful retail features can also increase revenues, yield profit, and keep guests coming back to a spa, as 15% to 30% of spa service revenue are spa retail sales. Another recommendation is to add spa retail products to mini-bar offerings, which is a subtle way to increase spa visibility while increasing retail revenues.
Depending on the hotel’s location and spa facilities, many hotels resort to adding local memberships that offer discounts on services, providing access to the fitness facilities and spa pools. Membership revenue is a steady source of revenue that can also provide an increase in traffic. The focus is to drive additional revenue and traffic through day passes or membership users coming to utilize the spa amenities.
Hair salons are a critical amenity for resorts and must cater to residents and member requests. Hair salons increase revenue by offering an additional service that brings in hotel guests, offer more lucrative spa packages, attract social groups and bridal parties, and allow for upsell of services.
Consistent with the slowdown in the overall performance of U.S. hotels during 2024, the average spa revenue growth rate for the hotels in our sample was limited to just 1.4%. The greatest increases in spa revenue were observed at urban and luxury hotels, as luxury urban properties expanded their reach into the local market to offset the slowdown in the general hotel business. Hotels located in remote and rural resort locations did not have the opportunity to take advantage of this strategy.
Expenses and Profits
While spa department revenues increased by 1.4% from 2023 to 2024, spa department profits declined by 0.5%. Expense growth was greater than revenue growth during this time, which was consistent with overall trends in hotel operations in 2024.
In 2024, total spa department expenses at the hotels in our sample increased by 2.1%, with the primary driver of the increase in department expenses being labor costs, which rose by 3.9%. Facing slow revenue growth, spa department operators were able to cut their costs of goods sold by 9.9% and reduce other non-labor expenses by 1.1%.
Figure 2: Change: 2023 to 2024 Dollars Per Available Room *Note: Hotel operated. Leased spa operations not included. — Source: Source: CBRE Hotels Research, Trends® in the Hotel Industry – Same store sample of properties that self-operated a spa 2023 and 2024.
Within spa department labor costs, a 6.8% rise in employee benefits outpaced the 3.0% increase in salaries and wages. One tactic spa department managers use to control labor costs is the use of contract employees. In 2024, payments made to contract employees averaged 9.6% of total salary and wages. Due to the greater availability of contract spa technicians in the local community, this ratio is 17.9% at urban hotels.
Figure 3: Contract Labor as a Percent of Total Revenue Salaries and Wages *Note: Hotel operated. Leased spa operations not included.— Source: Source: CBRE Hotels Research, Trends® in the Hotel Industry – Same store sample of properties that self-operated a spa 2023 and 2024.
Today, spas are looking to incorporate services and amenities not requiring a therapist, such as LED light therapy, Himalayan salt treatments, infrared saunas, cryotherapy, percussive therapy and enhanced hydrotherapy, to bring in incremental revenue with minimal expenses.
The enhanced use of contract employees, combined with the ability to accommodate local residents, enabled urban hotels to achieve a 1.2% increase in spa department profits in 2024. Conversely, the spa departments within resort area hotels declined by 0.7%.
Figure 4: Change in Spa Department Revenues and Profits: 2023 to 2024 *Note: Hotel operated. Leased spa operations not included.— Source: Source: CBRE Hotels Research, Trends® in the Hotel Industry – Same store sample of properties that self-operated a spa 2023 and 2024.
From an asset management perspective, it is paramount to ensure the operator and hotel leadership are focusing on selling the spa and spa services and incorporate spa and wellness in their property pitches every day. We apply a disciplined focus on treatment room utilization, breakdown of revenue by service, monitor guest satisfaction very closely, and ensure the spa revenues per square foot and profitability are maximized.
To benchmark your property’s spa operation, please contact [email protected]. This article was published in the July 2025 edition of Spa Business.
Robert Mandelbaum
Director of Research Information Services
CBRE Hotels
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