What type of vacancy refers to unrented space that could potentially generate income?

The type of vacancy that refers to unrented space that could potentially generate income is known as physical vacancy. This term describes the actual, observable space within a property that is unoccupied but can be leased out to tenants. It indicates the number of units or square footage that are currently not generating rental income simply because they are not leased.

Physical vacancy reflects the total available space in a property that is not renting, but it is considered a potential revenue source if leased to tenants. It serves as an important metric for property owners and investors as they assess the performance and profitability of their real estate investments.

In contrast, economic vacancy includes not just physical vacancy, but also considers factors like rental rates and lease conditions that might result in lower income than expected. Structural vacancy often refers to vacancy caused by deficiencies in the property's design or layout, making it less attractive to potential tenants. Effective vacancy usually pertains to the calculation of rental income after accounting for concessions and defaults, typically emphasizing the financial aspect rather than the physical space itself.