Free tools / Economic vs Physical Occupancy
Economic vs Physical Occupancy
Physical occupancy counts units. Economic occupancy counts dollars collected against what the facility could earn at street rates. The gap shows where revenue leaks.
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Results
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Physical occupancy = occupied units / total unitsPotential rent = total units x street rateScheduled rent = occupied units x in-place rateCollected rent = scheduled rent - discounts - delinquencyEconomic occupancy = collected rent / potential rentVacancy loss = vacant units x street rateandloss to lease = occupied units x (street - in-place)Annual leakage = (discounts + delinquency) x 12
A negative loss to lease means tenants pay above street, which is common after rate increases. That is a pricing signal worth reviewing.
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