Luxury Properties Are Stalling at 75%—Here’s Why

A common challenge in multifamily lease-ups is the inevitable plateau—leasing begins with strong momentum, but once a property reaches 70-80% occupancy, progress slows. Property teams often struggle to regain traction, attributing the stall to market conditions or a temporary lull in demand.

In reality, this is not a matter of bad luck. It is a structural issue within the lease-up strategy itself. The tactics that work in the early phases of leasing do not always carry a project through to stabilization. Understanding why this shift occurs—and knowing how to respond—separates properties that struggle from those that consistently achieve full occupancy.

The Lease-Up Trap:

A luxury development in our submarket exemplifies this all-too-common scenario. The property was thoughtfully designed, featuring high-end finishes, a prime location, and a carefully curated amenity package. Yet, nine months after opening, occupancy remained at just 72%.

The issue was not the product—it was the strategy. Early demand created an illusion of sustained success, leading the leasing team to reduce marketing efforts and abandon targeted outreach. When momentum inevitably slowed, the response was reactive rather than strategic. The result was an extended lease-up period and higher carrying costs, far exceeding what a well-planned marketing investment would have required.

This is a cycle seen time and time again:

Strong initial leasing performance and then...

• A slowdown as the most eager renters sign leases
• A reactive approach—scaling back marketing, over-relying on incentives, or shifting focus to other projects
• An extended lease-up period that erodes NOI and delays stabilization

How to Push Beyond the 80% Barrier

Achieving full occupancy requires a strategy shift. The leasing efforts that drive early success must evolve to meet the changing nature of demand. The following principles guide properties past the inevitable plateau:

1. Maintain a Consistent Marketing Presence

Many properties reduce marketing efforts after an initial leasing surge, assuming that demand will remain steady. However, the second phase of lease-up requires targeted messaging to reach prospective renters who were not in the market when the property first launched.

Here's what you can do: 

• Sustain marketing spend and adjust campaigns based on leasing velocity rather than arbitrary timelines.
• Diversify outreach channels, including digital advertising, local partnerships, and content-driven marketing.
• Refresh messaging to create urgency, emphasizing remaining availability and unique value propositions.

2. Refine Targeting Strategies to Reach the Next Wave of Renters

The first group of residents in a lease-up is often composed of renters actively searching for a new home. As the lease-up progresses, however, the next phase of prospects may require a different approach—often renters relocating for work, downsizing, or considering a move but not actively searching.

Here's what you can do: 

• Analyze existing resident psychographics and adjust marketing efforts to attract similar prospects.
• Implement retargeting campaigns to re-engage leads who previously inquired but did not convert.
• Leverage corporate partnerships and relocation services to reach potential renters who are not actively searching online.

3. Invest in Leasing Teams to Preserve Momentum

A highly trained, engaged leasing team is essential to sustaining progress. High turnover or disengaged staff can significantly impact conversions, particularly in the later phases of a lease-up.

Here's what you can do: 

• Provide ongoing training focused on strategic follow-ups and sales-driven leasing tactics.
• Establish clear lead management protocols to ensure no prospect is overlooked.
• Implement performance-based incentives to maintain engagement and motivation among leasing professionals.

4. Leverage Resident Referrals and Community Engagement

A well-structured referral program can be one of the most cost-effective ways to generate qualified leads. Prospective renters are more likely to consider a property when recommended by a friend or colleague, making resident advocacy an invaluable tool.

Here's what you can do:

• Offer structured referral incentives that reward both the current and new residents.
• Create buzzworthy social events that encourage residents to invite friends and colleagues to experience the property.
• Develop partnerships with local businesses who have similar buyer personas to your renter base to enhance visibility and credibility within the community.

5. Use Incentives Strategically—Not Reactively

When occupancy plateaus, many properties default to aggressive rent concessions. While incentives can be effective, they should be structured to create urgency rather than erode long-term revenue.

Here's what you can do: 

• Implement limited-time offers to drive immediate action, such as waived fees or a short-term discount on select units.
• Emphasize value over price by highlighting amenities, service, and lifestyle benefits rather than relying solely on financial incentives.
• Use dynamic pricing strategies to adjust rates based on leasing velocity and market conditions rather than reactive discounts.

The Path to Full Occupancy

Reaching 70-80% occupancy is a milestone, but it is not the finish line. The properties that achieve full lease-up are those that recognize the need for a strategic pivot rather than a reactive response.

By maintaining marketing consistency, refining targeting efforts, investing in leasing teams, leveraging resident engagement, and structuring incentives strategically, properties can accelerate lease-ups while maximizing NOI. The most successful developments do not wait for demand to return—they create it.