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What to Look for in Your Occupancy Reports

Posted: 1/4/2018
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When acquiring a new self storage property or properties, one of the items you will receive during your due diligence is the occupancy report. Many of the reports you are familiar with may be produced by one of the automated platforms being offered to the industry.

While these reports provide you with a quick snapshot it may still be difficult to determine the actual occupancy, especially with an out-of-state acquisition. Remember, behind any piece of technology there is a human factor. Therefore, mistakes can happen whether in keying or miscommunication so your seller needs to provide you with as much information as possible. You need to be able to have someone you trust such as your broker or lender if you cannot actually complete an in-person inspection. This will help identify or answer the following:

  • Does the occupancy report you were provided actually match to what you see physically? Count the occupied vs. unoccupied – do they match? If not, what is the reason for the discrepancy?
  • Open actual units that are stated as vacant – is there anything inside? Are these guest units or leased outside of normal rental procedures? If so, do they show as cash flow that is on the books?
  • Open any “red-locked” units - how many units are locked for non-payment? How are these accounted for?
  • Are there any units that do not show cash flow? Are they temporary units being used for some explainable reason? Might you be missing out on potential income?
  • Is occupancy/vacancy equal among the different size units? If not, some units may be difficult or always vacant making high vacancy for the property an issue for further consideration. Building out or adjusting units to more popular sizes may be the remedy.

There are many resources to help you in this regard. Resources include information, education, networking, vendor referrals, events, standardized agreements, data collection, marketing, advocacy and publications for current and potential facility owners, managers, suppliers and investors. For additional information visit OSNational.com.

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