In Part 3 of The Real Cost of Vacancy series, Jason Williams and co-host Frank Patalano break down one of the most misunderstood concepts in commercial real estate underwriting: the difference between physical occupancy and economic occupancy. This episode dives deep into why properties can appear “full” on paper yet still bleed cash, how bad debt, concessions, loss to lease, and operational decisions impact true performance, and what red flags investors should look for during due diligence.

Topics Covered

• Physical vacancy versus economic vacancy and why the difference matters

• How a property can be 95 percent occupied and still lose money

• The impact of bad debt, delinquency, and non-paying residents

• Concessions, loss to lease, and how they reduce economic occupancy

• Model units and emp ...