How to verify rentroll in multi-family property due diligence ?

1 Reply

Hi Fellow Investors,

I am in contract with 30 unit apartment complex. Sellers, 3 months ago moved over Property from 3rd party Property Management company to his in-house property management company.

Questions:

1. How do I verify if the rents claimed in rentroll are accurate and not delinquent or incorrect besides looking at leases.

2. Can their be another catch or mis-representation seller trying to do by moving over property into in-house property management ?

Will highly appreciate your guidance or response on this

Thanks, Gary

Originally posted by @Gary B. :

Hi Fellow Investors,

I am in contract with 30 unit apartment complex. Sellers, 3 months ago moved over Property from 3rd party Property Management company to his in-house property management company.

Questions:

1. How do I verify if the rents claimed in rentroll are accurate and not delinquent or incorrect besides looking at leases.

2. Can their be another catch or mis-representation seller trying to do by moving over property into in-house property management ?

Will highly appreciate your guidance or response on this

Thanks, Gary

I would ask for copies of all bankstatements that receive payments. Cross reference deposits and canceled checks with lease agreements and you'll be able to figure out the rent roll.

I hope this helps and have a good one.