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Thread: Numbers...

  1. #1
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    Post Numbers...

    For the company my husband and I work for, they have us calculating how much we've gained by square footage, such as for bank loan renewal, etc. It isn't determined by the occupancy percentage, only square feet percentage. What I'd like to know is if that's what other storage companies are having their managers do or is it strictly the percentage of occupancy gained that matters?

    Basically, we gain an entire 1% if we were to rent 1100 square feet. Today, we lost 800 square feet, which is too close for comfort and puts us in the extremely low 90% range. If we drop below 90%, corporate starts hounding us with demands for rentals, despite the fact that the economy is rough and no one in our area (middle class to poor) wants to spend the extra money to pay for storage. That's the main reason why our auctions are so huge now too.

    Does your company care about the square feet? Or just the occupancy percentage?

  2. #2
    Lisa T's Avatar
    Lisa T is offline Senior Member
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    Jennifer, our square footage occupancy is always higher then our unit occupancy. It's much easier to rent medium to large units then it is to rent our 20 5x5x5 lockers, and our 48 5x5x10 units. We also have 1 10x3x10 and 4 5x2x10...so that amounts to 12% of our unit occupancy, but not much of our square footage....so we have the opposite problem...our company looks at unit occupany rather then square footage, and ur square footage is usually about 4% higher then our unit occupancy.

    Guess you can't win no matter what!

  3. #3
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    Quote Originally Posted by Lisa T View Post
    Jennifer, our square footage occupancy is always higher then our unit occupancy. It's much easier to rent medium to large units then it is to rent our 20 5x5x5 lockers, and our 48 5x5x10 units. We also have 1 10x3x10 and 4 5x2x10...so that amounts to 12% of our unit occupancy, but not much of our square footage....so we have the opposite problem...our company looks at unit occupany rather then square footage, and ur square footage is usually about 4% higher then our unit occupancy.

    Guess you can't win no matter what!
    From a lot of talk from other people who have been in the storage business, it seems most companies calculate the occupancy as their target goal, not the square feet. But our company is the only one I've ever worked for that is the opposite. Very wierd and in regards to bank loans, is that legal in California? Or should my company be focusing on the occupancy percentage? I don't know too much about business loans, so I'm in the dark about what our company is telling us. Half the time I think it's bogus and they're trying to scare us into bending over more than backwards to gain more square feet than is really necessary for the bank loans to be approved.

  4. #4
    hdenterprises is offline Junior Member
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    A lot of banks want to know square footage as opposed to unit occupancy. I think its because that is how they figure out the economic occupancy. Banks don't care too much about physical units rented, just that the facility is getting a good income (per square foot) and good gross revenue generating. Of course, if you have a high unit occupancy, its good, but only if rates arent compromised. A lot of credits and lowering of rates will compromise the rates and income per square foot. When I'm an owner , I will want a report on the net units sold, but also the rental rate variance will be studied a lot. For a company to JUST look at square footage and not what is being charged for that square footage, is not smart.

  5. #5
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    Makes sense to me. Unfortunately, becuase of our area, we may have to lower rates and halt rate increases just to keep people. A lot of tenants are leaving because it's becoming too expensive for them. They're losing hours at work or getting laid off period, so if they need storage because they can't afford to pay for their home, they end up selling their stuff instead or storing with friends or family. And those that have storage, end up getting rid of it because they can't afford to keep their stuff in the unit. Either way, we're not going to be getting the revenue we'd like to per square feet. Ugh.

  6. #6
    dennybeall is offline Senior Member
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    We are the company representative and have used square footage since the management company was fired and we took it over. Using # of units just doesn't tell me what I need to know about the total health of the facility. Renting 3 5X10 units just doesn't compare to 1 10X20 unit income wise. Looked great for the management company to say we rented 3 units today.

  7. #7
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    Quote Originally Posted by dennybeall View Post
    We are the company representative and have used square footage since the management company was fired and we took it over. Using # of units just doesn't tell me what I need to know about the total health of the facility. Renting 3 5X10 units just doesn't compare to 1 10X20 unit income wise. Looked great for the management company to say we rented 3 units today.
    No arguement there, but from past experience and speaking to other leasing agents or managers, they are used to reporting the occupancy percentage to corporate office, whereas we report the actual square feet percentage. So I wanted to know if anyone else followed this or the other for their corporate people. Thanks for the responses! Love to hear more!

  8. #8
    Lisa T's Avatar
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    We have web based software here, so we don't report anything...they just look whatever they want to up whenever they get ready.

 

 
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