Closing soon on fully occupied rental (next steps)

Valhalla, NY · Member since 2013 · 132 posts · 84 votes

Hello all,

After a few months of having a property under contract and waiting for lawyers and title to clear everything we are finally ready to close on an investment property. This property is a mixed used commercial (retail storefront) and 2 apartments above. The property is occupied with leases in place. My question is what would the next step be once we close? Should I send out updated leases with our new landlord information ( I know the old leases are still binding until they expire) . Do a walkthrough and talk to all the tenants? Not sure what the proper etiquette is once you close on an occupied building. Any and all tips would be greatly appreciated.
thanks in advance

Nick

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Theresa HarrisPro Member
Member since 2019 · 15k+ posts · 11k+ votes
4y
Ask the seller to reach out to the tenants and let them know the building has sold and the current leases will be honored and deposits transferred to you. What is the closing day? If it is close to the first of the month when rent is due, reach out to them now to let them know who you are and your contact information-you can ask the seller to do this as well.
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Nathan GesnerBusiness Member
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Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes
4y
If they are still under a term lease, you have to honor that lease until it expires. Once it expires, or if they are on a month-to-month lease, then you can give them 30 days notice (or whatever your State requires) and sign a new lease with new terms and rates.
On the day of closing, I recommend you introduce yourself to the Tenants with a short, professional letter. Introduce yourself as the owner, tell them how to pay rent, how to communicate with you for ordinary issues and for emergency issues, and then schedule an inspection within one week. That inspection should be documented with pictures and/or video and used as your comparison point for when they move out.

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