Occupancy Rate
Percentage of available lettable units or floor space generating rental income
What is Occupancy Rate?
Occupancy rate is the percentage of a property's units or floor area that is let or occupied. It shows how much of a property is earning rent.
Empty space earns nothing, so occupancy is a central measure of property performance.
How this KPI is measured
- Function
- Operations & Supply Chain
- Sub-function
- Property Management
- Industry
- Real Estate
- Type
- Lagging
- Impact
- Financial control
- Unit
- %
- Measurement frequency
- Monthly
- Formula
- (Occupied units or sq ft / Total available units or sq ft) × 100
How to calculate it
Divide occupied units or floor area by total available units or floor area, and multiply by 100.
For example, if 92 of 100 units are occupied, occupancy is 92%.
Measure by units or square feet consistently, and look at trends, lease expiries and the time units stay empty.
Where it is used
Managing lettings
See how full the portfolio is.
Forecasting income
Estimate rent.
Assessing demand
Spot market changes.
How to improve it
Tips and common mistakes
- Physical occupancy differs from economic occupancy, where rent is paid.
- Very high occupancy may mean rents are too low.
- Watch turnover costs.
More Operations & Supply Chain kpi library
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