Physical occupancy measures how many units have a tenant, but not whether they pay. A "full" portfolio with low collection still has cash flow problems. The metric that matters is economic occupancy (occupancy × collection rate).
Units with an active tenant today ÷ total portfolio units. This is in your property management system, or count it directly from your spreadsheet of active contracts.
Each point of vacancy in a $100K GPR portfolio equals $1,000/month in lost income. With 3 vacant units out of 50, you lose $3,600/month in uncollected rent alone, plus the cost of maintaining vacant assets.
| Status | Range |
|---|---|
| Healthy | > 93% physical occupancy |
| Alert | 85–93% |
| Critical | < 85% (structural vacancy) |
Reletting time (days between a tenant leaving and the next arriving) is the main occupancy lever. Automating vacant unit listings and having a candidate pipeline before contract expiration reduces average vacancy time.
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