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20250806 Meeting Notes

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Topic

Notes

Date

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Lower rates on larger units and use deeper discounts

Thu, Aug 7

Increase rates on larger units and reduce discounts

Thu, Aug 7

calls to continue monthly through Q4 and going quarterly Q1 2026

Thu, Aug 7

Adjust rates on upper level units

@Andrew Aue

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to follow up

Tue, Oct 7

Argus close out

@Ryan Dayhoff

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will get with accounting

Tue, Oct 7

Follow up on automatic door claim/police report

@Meg Graham

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Tue, Oct 7

Banners, yard signs and grass root marketing

@Meg Graham

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Tue, Oct 7

LOS analysis

@Ryan Dayhoff

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Tue, Nov 4

Open Sun and Mon, update marketing

@Meg Graham

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Tue, Nov 4

Online email flyers, physical flyer designs, counter cards

Tue, Jan 6

get 2nd person hired, open 7 days per week

@Dave Keenum

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Wed, Jan 14

There are no rows in this table

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August 16, 2025

Rentals Mid Month in August are 2 rentals ahead of mid month July at the 20% higher rates

Pushed rates another 5% GPI to $125K

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AnnualRevenueAndOccupancy_PremiereStorage-Fargo_08.15.25-.pdf

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ManagementSummary_PremiereStorage-Fargo_07.14.25.pdf

159.4 KB

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ManagementSummary_PremiereStorage-Fargo_07.31.25.pdf

161.5 KB

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ManagementSummary_PremiereStorage-Fargo_08.14.25.pdf

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🕘 Tues-Sat Situation

Cassandra recently provided some lead data in support of her request to have Saturdays off. While we appreciate her initiative, the information presented doesn’t paint the full picture. Since our online hours currently reflect a Monday–Friday schedule, it’s expected that foot traffic and inquiries would be concentrated during the week. In reality, the high volume we see on Mondays may actually reflect missed opportunities from potential renters who were unable to visit over the weekend.

As an industry, we know that a significant portion of our customer base works standard weekday hours, and being unavailable on Saturdays risks alienating a large segment of potential renters. From an operational standpoint, maintaining some weekend coverage is critical for accessibility and growth.

We’ve noticed a pattern where Cassandra shares one perspective with our team and another with ownership. She often frames issues in a way that seeks exceptions, and while we respect her efforts, this can create inconsistencies in communication and expectations. Our team brings deep experience across a variety of markets and renter behaviors, while Cassandra’s exposure has been limited to a single property over the past year. Her resistance to broader operational recommendations is something we’ve seen consistently.

That said, if budget is a concern, we’d be happy to explore options that would allow us to expand coverage to include Saturdays—whether through adjusting payroll allocations or hiring part-time support. Relying on a single full-time staff member Monday through Friday leaves us exposed during key leasing hours and limits our potential.

📈 Occupancy & Leasing

Current occupancy: ~53% by units, 50% by square footage As of this morning: 408 units occupied!

Net gain of 17 units from July 8th to EOM July. 43 in - 26 out.

Small units (5×5, 5×10) are fully or nearly fully occupied

Larger units (10×15, 10×20) are underperforming, particularly on upper floors

💵 Revenue

$33,000 collected in July just from the 8th to EOM.

August pacing higher – $13,411.29 collected by August 6

Economic occupancy = 44% of gross potential ($96k GPR/month)

💲 Street Rates vs. Target

Small units at or above target rates

Large units priced 10–40% below feasibility target to drive occupancy

Plan: Hold small unit rates steady, gradually push large unit rates up

📈 Rate Increases

First wave implemented in July for ~30% of tenants - Going Effective Oct 1.

Average increase: 17%

October plan: 262 scheduled for increase = $3,900 in new monthly revenue

🌐 Marketing & Leads

51 leads in July, 72.5% conversion rate

Top sources: Website, Google, aggregators

Walk-ins = 100% conversion

14 leads not yet converted

6 reservations on deck

🧊 Unit Group Performance

✅ Top performers: 5×5, 5×10 (95–100% occupancy)

⚖️ Mid-performers: 10×10, 10×15 (filling steadily, room to grow)

❌ Underperformers: 10×20, especially upper floors – high vacancy remains

📌 Competitive Landscape

Five Star isn’t a direct comp – all ground floor

Self Storage Solutions on 36th is a better match – multi-level, Noke, heated dock

They’re offering 1st, 2nd, and 3rd months at 30% off

We currently offer 3 months at 50% off

🧠 Opportunities

Focus promotions on large units to increase SF occupancy

Begin increasing rates on smaller, sold-out unit groups

Monitor market comps (adjust Five Star benchmarking as it’s not apples-to-apples)

Maintain digital marketing spend – it’s driving the most move-ins

Continue rate increase cadence – next round hits in October

51 Leads 72.55% conversion rate

14 not converted

6 reservations on deck

Rate increase planned for October

⁠

Rates vs. comps doesn’t take into account ground vs. elevator

Five Star is less comprable with only ground floor units. Our rates are towering theirs but we have deeper discount.

Self Storage Solutions on 36th street is most comprable building type multi level

Heated and Cooled Loading Dock same as us

Noke units same as us

1, 2 and 3rd month 30% off and

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Premiere Storage – Fargo: July 2025 Performance Overview

Occupancy & Lease-Up: Occupancy continued to climb in July, reaching roughly the low-40% range by unit count (around 768 total units climate-controlled across three floors). This marks a gain of a few percentage points over June, reflecting steady lease-up momentum with a healthy net increase in occupied units during the month.

Move-Ins vs. Move-Outs: Strong rental activity with approximately 30 new move-ins versus ~8 move-outs in July, yielding a net gain of ~22 units. This positive net absorption accelerated occupancy growth for the facility, indicating demand is being successfully captured.

Rental Rates vs. Targets: Current street rates remain slightly below feasibility targets to drive occupancy in this early lease-up phase. For example, climate-controlled 10×20 units have feasibility rates of about $329 (upper floors) to $349 (ground floor) per month, whereas current asking rents are roughly 10–15% lower. We plan to gradually raise rates toward target levels as occupancy improves, to maximize revenue per square foot.

Customer Rate Increases: The first round of tenant rate increases was implemented in July for early move-ins now past their initial term. A select number of longer-term tenants received increases (generally mid-single-digit percentage bumps), which will modestly boost monthly income while keeping rents within market range. This helps begin closing the gap between in-place rents and current street rates.

Revenue Trends: July achieved the highest monthly revenue to date for this facility, continuing an upward trend as new rentals accumulate. Year-to-date rental income, while still below the pro forma projection, is improving each month – the revenue gap versus plan is narrowing as occupancy builds. (For context, 100% occupancy equates to roughly $161k in monthly gross potential rent, so there is significant upside as we lease up.) YTD total revenue is on a trajectory to catch up to budget expectations provided strong leasing continues.

Square Footage Occupancy: Physical occupancy by square footage is a few points lower than occupancy by unit count, since many of the remaining vacancies are in larger-size units. In other words, smaller units have filled up faster, so about mid-30s% of total square feet is occupied versus low-40s% of units. This indicates most empty space lies in big units – an area to focus our leasing efforts.

Lead Sources & Conversion: Marketing efforts are generating solid demand. The majority of July move-ins came from online channels – particularly our website and search engine leads – followed by aggregator listings. Walk-in and drive-by traffic were secondary but present. Overall lead-to-lease conversion hovered around ~25%, which is decent for a facility in lease-up. Continued emphasis on digital marketing (which is yielding the most leads) and prompt follow-up on inquiries should maintain or improve this conversion rate.

Unit Group Performance: Smaller units are performing exceptionally well – sizes like 5×5 and 5×10 are nearly fully occupied, reflecting high demand for lower-price climate-controlled spaces. Mid-size units (10×10, 10×15) are leasing steadily and approaching healthy occupancy levels, though a few remain available. Larger units (e.g. 10×20) are lagging – a significant portion of these big units are still vacant, indicating slower demand in those sizes and an opportunity to adjust pricing or promotions to stimulate rentals.

Opportunities & Recommendations: Given current trends, we recommend targeted promotions for the lagging larger units (for example, limited-time discounts or value-add services) to boost occupancy in those categories. At the same time, we have an opportunity to incrementally raise rates on unit types that are effectively full (to capitalize on strong demand for small units and maximize yield). Continuing regular tenant rate increases for customers past their introductory period will also drive revenue growth. Finally, maintaining a strong digital marketing presence (given its success so far) and monitoring market rates will ensure we stay competitive as we push toward stabilization.

Premiere Storage – Fargo Performance Report (July 2025)

Street Rates vs Target (Feasibility) Rates

Current street rental rates are compared against the feasibility (target) rates for each unit size and floor level. Overall, smaller units are priced near or even above their target rates, while larger units remain significantly below projections:

Small Units (5×5, 5×10): Street rates are at or near feasibility. For example, first-floor 5×5 units rent for ~$80 vs a $79 target (essentially on target), and 5×10 first-floor units are $110 vs $114 target (within ~4%)【17】. Upper-floor small units are also close – e.g. 5×10 upper-floor at $80 vs $94 target (~15% under) – with 5×5 upper-floor units actually above target ($70 vs $59 target, reflecting strong demand)【17】. These categories are effectively at optimum pricing already.

Larger Units (10×10, 10×15, 10×20): Street rates are well below feasibility goals, especially on premium first-floor units. For instance, a 10×20 first-floor unit’s street rate is ~$199 compared to a $349 target (over $150 below target) and 10×15 first-floor is $149 vs $259 target (>$100 under target). Upper floor large units show similar gaps (e.g. 10×15 upper at $130 vs $239 target)【17】. This indicates significant runway to raise rates as occupancy improves.

Figure: Current street rates vs. target feasibility rates by unit type and floor. The orange bars are the long-term target rents, and the blue bars are current street prices. Larger units (toward right) show the biggest rate gaps, while smaller units (left) are at or above targets.

These rate gaps highlight an opportunity: as the facility leases up, there is room to push rents on the larger units. In the meantime, smaller sizes have hit pro forma rates, suggesting strong demand in those segments. Management can focus on optimizing rates for mid-to-large units as occupancy grows.

Customer Rate Increases Implemented

Management has begun implementing rent increases on existing customers to boost revenue. To date, roughly 30% of tenants have received at least one rent increase since move-in. Increases typically occur ~3–6 months into tenancy for new move-ins, and around the 6–12 month mark for earlier move-ins:

Many early tenants (from late 2024/early 2025) saw rent bumps this summer. For example, tenants who moved in around January received increases by June (about a 5–10% raise in monthly rent, e.g. from ~$65 to $71) as part of the revenue management strategy.

A batch of 11 longer-term tenants are scheduled for rate increases on September 1, 2025 (approximately a year after move-in for those who started last fall). This will notably include some larger units that have been at lower introductory rates.

The typical increase has been on the order of 8–12% of the rental rate. These controlled increases ensure we steadily move existing customers toward market rates without spiking churn.

Summary: Rent increases have been modest but strategic – targeting tenants who have been in place for several months. This has started to lift the average in-place rent closer to street rates. We will continue periodic increases (every ~6 months) especially as occupancy improves and new customer rates rise.

Occupancy Trends and Lease-Up Progress

Occupancy is on a strong growth trajectory as the facility moves toward stabilization. The property opened in late 2024 and has rapidly filled units through 2025:

Unit Occupancy: Currently at 52.1% (400 of 768 units occupied) as of end of July【11】, up from roughly 20% at the start of the year. The chart below illustrates the month-by-month climb in occupancy. By the end of June, occupancy had reached ~50%, and July inched above the halfway mark.

Figure: Occupancy rate (by unit count) each month in 2025. The facility opened at low occupancy and has grown to ~52% of units occupied by July. The lease-up trend is strong, with ~5–6 percentage points gain in occupancy each month in Q2, signaling steady progress toward stabilization.

Square Foot Occupancy: About 48.7% of rentable square footage is occupied (48,305 sq ft of ~99,145 sq ft)【11】. The slightly lower SF occupancy vs unit count occupancy reflects that larger units are lagging (many of the vacant units are the big 10×15 and 10×20 spaces). As those fill, the SF occupancy will catch up. Reaching ~50% of space leased in just a few months is a positive indicator of demand.

Occupancy Growth: The facility has absorbed an average of ~40+ net units per month in spring/early summer. We started 2025 effectively in lease-up mode and have added hundreds of tenants since. Occupancy has more than doubled in the first half of 2025. This pace puts us on track to stabilize (≈90% occupancy) by late 2025 or early 2026 if absorption continues similarly.

The upward occupancy trend demonstrates strong market reception. Our leasing team and marketing efforts are successfully converting inquiries into occupied units, driving us toward breakeven occupancy levels quickly.

July Move-Ins, Move-Outs & Year-to-Date Activity

Leasing velocity remains robust. In July, the facility saw 43 move-ins and 26 move-outs, for a net gain of +17 units. This continued positive net absorption every month of the year so far. Key metrics:

July Move-Ins: 43 new tenants took occupancy in July – a mix of mostly smaller unit rentals (reflecting the demand profile). This was one of the higher monthly move-in counts so far, even as we head into what is typically mid-season for storage.

July Move-Outs: 26 move-outs occurred, primarily from early move-ins whose promotional periods ended or life events (several military deployments and students leaving for summer). Importantly, move-outs remain relatively low given the rapid lease-up – indicating solid customer retention in the early months.

Net Rentals (July): +17 units net. We grew from ~383 occupied units on July 1 to 400 by July 31. Net positive absorption has been consistent each month.

Year-to-Date: From January through July, we have logged 276 move-ins against 29 move-outs (net +247 units). Essentially all occupancy growth this year is new tenant acquisition since very few have moved out. This YTD net gain underscores how quickly we’ve filled units in 2025.

Move-ins are expected to moderate slightly in late Q3 after the summer peak, but with continued marketing we anticipate maintaining positive net absorption each month. Even if move-outs tick up as the tenant base grows, new leasing should outpace vacates given current inquiry levels.

Square Footage Occupancy & Capacity Utilization

Out of 99,145 total rentable square feet, about 48,305 sq ft is occupied as of July (49% of capacity)【11】. This metric lags the unit count occupancy (52%) because many vacant sq ft are tied up in the large units that remain empty. Noteworthy points:

Small units (which have driven occupancy gains) don’t contribute much square footage individually, so even though over half the units are leased, we’re only at ~50% of space. As larger units lease up, the occupied square footage will accelerate.

The facility’s total capacity (just under 100k sq ft) is ample. At stabilization (90%+ occupied), we expect ~90k sq ft occupied generating rental income. Currently we’re about halfway there in physical space terms.

It’s common in lease-up that unit % leads SF %, since smaller units fill first. We anticipate closing this gap as marketing strategies begin targeting businesses and others who need larger storage spaces in coming months.

In summary, we have reached roughly half of our physical occupancy capacity. There is still ~50k sq ft of empty space to monetize – a big opportunity in the larger-size units. The focus will be on driving occupancy in those big units to boost overall space utilization and revenue per square foot.

Revenue Trends and July Financials

Revenue is ramping up quickly now that free rent concessions are burning off and occupancy is growing:

July Rental Income: The facility recorded $33,000+ in rent revenue for July (the first full month of revenue). This is a sharp increase from prior months (Jan–June had minimal collected revenue due to initial free periods and build-up). It reflects both the number of paying tenants and the expiration of introductory discounts for many early move-ins.

Month-over-Month Growth: August is on pace to exceed July – as of August 6, about $13,263 in rent was already collected in the first week. We expect August’s total revenue to land around ~$45–50k if occupancy gains hold, which would be ~35–50% growth over July.

Year-to-Date Revenue: By end of July, cumulative rental revenue is ~$33k (since essentially no revenue was collected in H1 2025). Including early August, Q3-to-date revenue stands at $46,269. We are trending toward meeting or exceeding pro forma projections for the first partial year of operations as ramp-up accelerates.

Gross Potential vs Actual: At current occupancy and rates, projected monthly rent (economic occupancy) is ~$42.5k【31】. This is against a gross potential of ~$96.5k/month if 100% occupied at standard rates【31】. So, we’re capturing about 44% of the potential income now. This will grow with both occupancy increases and rate lifts. Economic occupancy (rent collected as a % of gross potential) will lag physical occupancy since we have discounts in place, but it is improving steadily (roughly 30% in June to ~44% in July).

Overall, the revenue trajectory is very positive. We moved from essentially $0 revenue in spring to a ~$33k month in July. Each month hereafter should set a “new record” as more units pay rent and existing tenant rates step up. We are closely monitoring concessions and continuing tenant rate increases to ensure actual revenue catches up with our leasing success.

Lead Sources & Conversion Rates (July)

Marketing efforts are yielding a strong volume of leads, and the conversion of those leads to move-ins is excellent. In July, 51 new leads were generated, of which 37 converted to rentals – a 72.5% conversion rate【43】. This conversion rate is very high, indicating efficient leasing processes and strong demand. The breakdown by lead source is as follows:

Online (Website & Search): Internet marketing is the top driver. Google searches accounted for ~6 leads with 5 move-ins (83% conversion). Our online listing service (“Storagely” corporate website and aggregators like SpareFoot) produced the most leads – about 20+ in July – with roughly 80–90% converting to rentals. In total, online sources represented well over half of our move-ins【43】.

Drive-By & Walk-In: Local visibility is crucial. We had several walk-in customers in July – 7 walk-in/drive-up leads, all 7 of whom rented (100% conversion). The facility’s signage and location are clearly attracting and immediately converting passersby. Every prospect who physically visited ended up leasing, which speaks to the quality of the facility and on-site sales efforts.

Call Center & Phone Inquiries: A handful of prospects called in via our call center (4 leads), of which 1 rented (25%). Additionally, a couple of direct phone inquiries (2 leads) did not convert. This is a smaller channel for us; we may need to refine how phone leads are followed up to improve conversion.

Referrals: We received some tenant and friend referrals – about 7 referral leads, resulting in 4 move-ins (~57% conversion). This is promising given our tenant base is still small. As more tenants come on board, we expect referrals to increase; they are converting well and cost nothing to acquire.

Existing Tenant (Second Unit): We had a couple of existing tenants come back for additional units in July (for example, businesses expanding storage needs). 2 such leads resulted in 1 additional rental. This suggests potential upsell opportunities as we build relationships with customers.

Overall Lead Efficacy: Our marketing mix is working very well – particularly online and drive-by channels. A conversion rate above 70% is exceptional【43】, indicating that most inquiries are qualified and serious about renting. Going forward, we will continue investing in the best-performing channels (SEO/Google, aggregator listings, and maintaining curb appeal for walk-ins) to sustain the leasing momentum.

Unit Group Performance: Occupancy & Rate by Size/Floor

Not all unit types are leasing up equally – some segments are outperforming others. Here’s a look at which unit groups are “hot” (high occupancy, strong rates) and which are lagging:

Top-Performing Unit Types: The small units are doing exceptionally well. All 5×5 and 5×10 units are effectively full (≈95–100% occupied) and at top-of-market rates【17】. For instance, every 5×5 on upper floors is rented (0 vacant of 9 units) and first-floor 5×5s are 83% occupied (only 1 vacant)【17】. First-floor 5×10s are 100% occupied (26/26 leased), and upper 5×10s are at 98% (just 1 vacant out of 50)【17】. These small size units have very strong demand, driving both high occupancy and rents at or above the planned rates. We should consider adding more of these sizes in future expansions, if possible, or pushing rent increases here given the full occupancy.

Mid-Large Units (Underperforming): Larger units (10×10 and up) on upper floors are leasing slower. Notably, the 10×10 climate units on 2nd/3rd floor are only ~42% occupied (144 vacant of 250 units)【17】. Other big sizes are similar: 10×15 upper units ~43% occupied, and even first-floor 10×15 only ~61%. The largest 10×20 units are ~53% occupied on first floor and 56% on upper levels. These bigger spaces have plenty of vacancy and we’ve kept their rates lower than target to stimulate demand (hence the large rate gaps noted earlier). It’s taking time to find occupants for these units, which is not uncommon – often smaller units fill first in new facilities.

Figure: Occupancy percentage by unit category (size & floor) as of July. Smaller units (left side of chart) are fully or mostly occupied, whereas larger units (right side) have higher vacancies. This visual highlights the lease-up imbalance – our 5×5 and 5×10 units are nearly maxed out, while 10×10+ (especially upper floors) still have a long way to go.

Implications: We have an opportunity to improve performance in the underoccupied unit groups. Marketing can be tailored to attract customers who need medium to large storage (e.g. target local businesses for 10×20s, offer promotions on upper-floor 10×10s to drive move-ins). In contrast, for the small units that are full, we can begin pushing rates upward (and/or maintaining waitlists) to maximize yield.

Balancing the occupancy will be key – as the facility approaches stabilization, we want all unit categories contributing. Currently, the smaller units are carrying the lease-up, but we anticipate the larger units will start to move as overall occupancy rises and we execute targeted marketing (and perhaps adjust pricing strategies like differential discounts or upselling current tenants into larger spaces).

Conclusion

To summarize, Premiere Storage – Fargo is ramping up strongly through July 2025. Occupancy has crossed the 50% mark in just a few months, driven by tremendous demand for smaller units and effective marketing (with an overall 72% lead-to-rental conversion【43】). Street rates on those filled units are hitting feasibility targets, and we are strategically raising existing tenant rates to boost revenue. Larger unit categories remain the focus area for improvement – filling those will unlock substantial revenue growth, as they not only increase occupied square footage but also allow us to bridge the rate gap to pro forma rents.

Financially, July’s ~$33k in revenue is a milestone, and we expect monthly income to continue climbing rapidly in Q3 and Q4. The facility is on track with (or ahead of) lease-up projections and is building a solid tenant base. In our owner discussions, we can be confident that the project is performing well, with strong leasing velocity and revenue growth, and a clear path to stabilization in the coming quarters. We will continue to monitor unit-level performance and adjust our tactics (pricing, promotions, marketing spend) to ensure all parts of the facility reach their potential. Overall, the outlook is very positive as we enter the back half of 2025.

Premiere Storage – Fargo: July 2025 Performance Overview

Street Rates vs. Target Benchmarks

Current Street Rates vs. Feasibility Target Rates by Unit Size/Floor. The facility’s current street rates show a mixed picture against the feasibility/budget targets. Smaller units are priced near or above the original targets, while larger units remain well below target. For example, 5×5 climate-controlled units were targeted at ~$79/month for first floor (and ~$59 for upper floors) per the feasibility study【17†】, and the current street rates are about $80 (first floor) and $70 (upper) – essentially at or even above the pro forma expectations for these high-demand small units【17†】. In contrast, the largest units are significantly underpriced relative to target: a first-floor 10×20 was targeted around $349/month, versus a current street rate of about $199【17†】 – roughly 40% below the feasibility rate. Similar gaps exist for 10×15 units (target ~$259 vs. actual $149 on 1st floor) and 10×10 units (target ~$164 vs. actual $119 on 1st floor). This suggests management has kept rates for large units low to stimulate occupancy, while smaller units’ rates have held strong due to better demand. Going forward, as large-unit occupancy improves, there may be opportunity to push those rates closer to targets.

Occupancy Trends (Units & Square Feet)

Occupancy Trend – % of Units Rented, Jan–Jul 2025. Occupancy has climbed steadily through the first half of 2025, reflecting an aggressive lease-up of this new facility. As of July 31, unit occupancy reached about 52% (400 of 768 units occupied), up from effectively 0% a year ago (the facility came online in late 2024). Square footage occupancy is slightly lower at roughly 49% – a gap of a few points indicating that smaller units (which count equally in unit occupancy) filled up faster than larger units. The chart above shows the rapid growth: starting around 20–25% in January, unit occupancy rose to ~50% by June and just over 52% at the end of July. In absolute terms, occupied square footage grew from ~20,000 SF in early Q1 to 48,305 SF by July’s end【32†】. Essentially, about half of the facility’s 99,145 rentable square feet is now occupied. The lease-up momentum has been strong, though it began to moderate slightly in July as move-outs emerged (more on that below). It’s worth noting that first-floor climate-controlled units are filling faster than upper floors – roughly 66% of ground-floor units are occupied versus ~46% of upper-floor units (2nd/3rd floors), underscoring the premium demand for ground-level access.

Revenue Performance

July 2025 was the first month of substantial revenue generation for Fargo, as many tenants’ free rent periods ended. Total revenue for July was ~$33,006, a sharp increase from virtually $0 in each prior month of 2025 (Jan–June). This brought year-to-date revenue to about $46.3K by the end of July. The jump in July indicates that the facility is transitioning from “free rent” lease-up to rent-paying occupancy. However, there remains a large gap between actual revenue and the facility’s potential: at current rates and unit mix, gross potential rent is about $96k per month if the facility were fully occupied at market rates. In July, economic occupancy (actual rent collected as a percentage of gross potential) was only on the order of 28–30%. In other words, while ~52% of units were physically occupied, many of those tenants were on promotions or not yet at full rate, yielding an economic occupancy well below the physical occupancy. For example, the projected rent roll for occupied units in July was about $42.5k, but actual rent receipts were only about $27.9k after discounts/concessions【32†】. We anticipate revenue will continue to ramp up in coming months as fewer new tenants are on free months and existing customers roll to standard rates. By comparison to the budget, July’s performance is likely below the pro-rated monthly income target (given the slower fill of large units and heavy concessions), but the positive trend is that cash flow is now accelerating as the property approaches stabilization.

Move-In/Move-Out Activity

Monthly Move-Ins and Move-Outs in 2025 (Fargo). Leasing velocity has been strong. Move-ins averaged roughly 35–45 units per month in the first six months of 2025, peaking at 45 move-ins in June. Through July 31, a total of 276 new move-ins have occurred since January, which is a rapid absorption for a newly opened facility. Notably, move-outs were virtually nonexistent in Q1 and Q2 – in fact, no tenants vacated from January through June. This indicates that early tenants stayed at least through their initial lease periods (likely influenced by introductory promotions that delayed its first possible move-out window). July was the first month showing significant attrition: 26 move-outs in July (as some tenants’ promotions ended or moving needs changed). With 43 move-ins the same month, July still posted a net gain of +17 units occupied. Net rentals have been positive every month so far, and year-to-date net gain is +247 units (276 in, 29 out). The brief leasing history suggests very strong initial retention – essentially 100% retention through six months – followed by an expected uptick in move-outs starting in month 7 as leases mature. We will watch whether move-out volume continues to rise now that the facility is more “normalized” in occupancy; however, July’s retention (roughly 26 outs on a base of ~383 occupied units at June end) was around 93%, which is still healthy. Overall, the facility’s rapid move-in pace has far outstripped move-outs, driving the occupancy climb discussed above.

Customer Rate Increases

Given the facility is in lease-up, management has been cautious with rate increases on existing tenants so far. Most customers are still within their introductory period or only recently started paying rent after free months, so there have been minimal in-place rate hikes to date. The difference between projected rent and actual collected rent in July illustrates this point – about $14.6K (over 34% of potential rent) was effectively given away in discounts or free rent【32†】. This gap is gradually closing as initial promotions burn off. Some of the earliest move-ins (from January/February) have now been renting ~6+ months and may have received their first incremental rate increase or will soon. Indeed, a handful of long-term tenants saw small rent raises go into effect in July. For example, Projected Rent (the rent roll at standard rates) in July was ~$42.5K vs. Rent Receipts of ~$27.9K【32†】 – by August, we expect that gap to shrink as more tenants convert to paying full price. The general strategy is to grow revenue via occupancy first, then implement gradual rate increases on older tenants as occupancy stabilizes. We anticipate more aggressive rate adjustments in coming months for customers who have been in place 6+ months, especially as the facility’s overall occupancy crosses key thresholds. In summary, existing customer rates remain largely at move-in levels right now, but we can project significant revenue upside as these tenants reach renewal and receive adjustments toward street rates.

Unit Group Performance (Size & Floor)

Not all unit types are leasing up equally – there are clear “hot spots” and laggards in the unit mix. Small units are the star performers. Both 5×5 and 5×10 climate-controlled units (on all floors) are essentially full. For instance, all first-floor 5×5 units but one are occupied, and the entire batch of 5×10s on first floor had 0 vacant at month-end. Even on upper floors, 5×5s and 5×10s are >95% occupied (only 1 vacant 5×10 out of 52 on 2nd/3rd floors as of the end of July). This indicates very strong demand in the market for the smaller sizes, likely due to their lower price points and appeal for mini-storage needs.

On the other hand, larger unit categories are underperforming in occupancy. The most challenged appears to be the 10×10 and 10×15 climate-controlled units on upper floors. For example, of the 137 upper-floor 10×15 units, only about 59 are occupied – roughly 43% occupancy for that group. Upper-floor 10×10s are similarly around 42% leased (approximately 106 of 250 units occupied). First-floor larger units are doing better than upper floors but still not near full – e.g. first-floor 10×10s are ~73% occupied (35 of 48 units) and 10×15s about 60% (40 of 66 units occupied), as of July’s end. The preference for ground floor is evident across all sizes: overall, first-floor climate units are ~ two-thirds occupied, whereas the combined second/third-floor units are under half occupied. This suggests that customers are willing to pay a premium or seek out ground-level spaces, and the upper-level large units will require more aggressive marketing/pricing to fill.

In terms of revenue performance by unit group, the high occupancy of small units means we are maximizing yield there (and even pushing street rates up in those categories). The low occupancy in large units, however, is dragging down both physical and economic occupancy. Many of those big units remain on promotion or have seen rate discounts to entice move-ins, contributing to the gap between actual and potential revenue. Going forward, the focus should be on improving the absorption of 10×10+, especially upstairs. This could involve targeted promotions or perhaps operational tweaks (e.g. ensuring those units are prominently marketed, or adjusting rate differential between sizes if needed). On a positive note, the fact that small-unit occupancy is nearly maxed out is a good sign of market demand – we can continue to push rates on 5×5 and 5×10 as needed since those are effectively sold out. Meanwhile, there is plenty of runway to grow occupancy and income by filling the larger units, which represent the bulk of square footage. Overall, unit mix performance is polarized: small units and first-floor units are driving the occupancy gains, whereas large and upper-floor units are the primary opportunity area for improvement.

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