How to Figure Out Occupancy Levels

Historical trends in occupancy levels can help determine future business potential.

Occupancy levels are the amount of people occupying a space compared to the amount of individuals that could occupy a space. This measurement is often used for office buildings, apartment buildings, hotels, hospitals and correctional facilities. It is closely affected by the occupancy rating of a building which is developed in conjunction with building code regulations of each state, county and federal regulations. The measurement is expressed as a percentage and can also be referred to as percent occupancy, percentage of occupancy or occupancy ratio.

Things You'll Need

• Paper
• Pencil
• Calculator

Instructions

1. Gather the business records from your facility for the past 365 days.

2. Review occupancy information of your facility. Determine if your occupancy rating is based on the number of beds, number of rooms or the number of offices. Evaluate the information and determine how many beds, rooms or offices were occupied each day of the past 365 days. Add the results of each day together for the 365 day period.

3. Review the schematic designs of your facility. Determine the number of beds, rooms or offices that were available each day for occupation. Evaluate the information for any fluctuation in availability caused by remodeling, renovations or budgetary closures. Add the results for each day together for the past 365 days. This calculation will be referred to as availability.

4. Divide your occupancy information by the availability calculation.

5. Multiply the calculation from step 4 by 100. This calculation will give you a percentage which reflects your occupancy level.

Tips & Warnings

• You can calculate occupancy levels for a specific area of your facility. Correctional facilities and hospitals can use this information to determine the availability of specific wards for new inmates or departments for scheduled medical procedures. Businesses can also calculate occupancy levels for specific time periods to forecast potential income and the number of employees needed to handle the expected business level. This information will be useful for financial investors and can be used to justify renovations or additions to existing facilities to support the business volume. If your business records do not have accurate information or you have not been tracking this information, you can implement the system today and calculate the occupancy level for shorter amounts of time until enough information has been collected for long-term forecasting.

• If business records are not accurately maintained during the year, you will not be able to accurately calculate occupancy levels. Forecasting occupancy levels will not ensure that this amount of business will actually occur. All trends will be related to your business and various economic and social factors.

References

• State of Pennsylvania: Occupancy Rates in Health Facilities