Bands by category
| Category | Cost per room (turnkey, FF&E included) | Indicative cost per m2 |
|---|---|---|
| Economy / budget | EUR 60,000 - 90,000 | EUR 1,500 - 1,900 |
| Midscale (3-star) | EUR 90,000 - 130,000 | EUR 1,800 - 2,200 |
| Upscale (4-star) | EUR 130,000 - 200,000 | EUR 2,200 - 2,700 |
| Luxury (5-star) | EUR 250,000 and above | EUR 3,000 and above |
Floor area per room is the reading key that links the two columns: an economy hotel develops 35-45 gross m2 in total per room (the room plus its share of common areas and services), a five-star can exceed 80. That is why cost per m2 and cost per room do not rise on the same gradient.
Where the budget concentrates
Rooms are repetition, common areas are design. Rooms are built in series and benefit from every optimisation replicated dozens of times; common areas (lobby, food and beverage, spa, meeting rooms) are one-offs with the highest costs per m2 in the property. In the upper categories, where common areas weigh more on total area, the average cost per m2 rises for this reason before it rises for room quality.
Services are the silent item. Per-room climate control, ventilation, hot water sized on peaks, extended fire protection, in-room automation, professional kitchens: in hospitality, building services reach 30-35 per cent of construction cost, appreciably more than in residential.
Back of house is unseen and paid for. Kitchens, laundry, stores, plant rooms, staff changing areas: areas that generate no direct revenue but consume budget and must be sized correctly, on pain of operational inefficiency for the property's whole life.
FF&E: the item comparisons forget
FF&E (furniture, fixtures and equipment) covers furnishings, soft goods and equipment: in hospitality it is not an accessory but a structural component of the budget, typically 15-25 per cent of total cost, with higher shares in the upper categories. To it is added OS&E (operating supplies and equipment): linen, tableware, opening stock.
Two practical implications. First: any comparison between hotel estimates must state whether FF&E is included, because the difference is worth a quarter of the budget. Second: FF&E has its own renewal cycle, five to eight years for the upper categories, which must be provisioned from opening and belongs to the property's business plan, not only to the project.
Example cost framework: 4-star hotel, 60 rooms
| Item | Calculation | Amount |
|---|---|---|
| Construction (building and services) | 60 rooms × EUR 120,000 | EUR 7,200,000 |
| FF&E | 60 rooms × EUR 30,000 | EUR 1,800,000 |
| OS&E and opening stock | 60 × EUR 4,000 | EUR 240,000 |
| Professional fees and project management (10%) | EUR 900,000 | |
| Municipal fees, connections, testing (estimate) | EUR 350,000 | |
| Contingencies (8%) | EUR 830,000 | |
| Total investment excluding land | EUR 11,320,000 | |
| Per room | / 60 | ~EUR 188,700 |
The all-inclusive cost per room (~EUR 189,000) is the figure the operation's business plan compares against expected revenue: average rate, occupancy and revenue per available room. A hotel investment is assessed on that ratio, not on cost per m2.
Note: the figures shown are 2026 orders of magnitude for the Italian market, for guidance only. Every hotel project requires a feasibility study and a specific estimate based on a bill of quantities.