In a recent article by Scott Lewis-CEO, Spartan Investment Group LLC, Scott discussed the various Occupancy types, their differences and the affects on performance measurement.
“As self-storage operators, we’re obsessed with facility occupancy. It’s mentioned everywhere: at every industry convention and meeting, in every trade magazine, with graphs of where it is today compared to historic levels. We worry about occupancy every day and rightfully so, as it indicates business performance and the underlying financials.
However, when discussing occupancy, it’s vitally important to understand which type. There are two—physical and economic—and many operators confuse them. Failing to understand the difference can cause managers to pull the wrong operational levers at their facilities, thus failing to maximize revenue potential.
Let’s talk about the two occupancy types, how they differ, and how to use them to set key performance indicators (KPIs) and drive performance at our properties.”