Rent Roll

The spreadsheet or document detailing each of the unit in an apartment community. A good rent roll will include unit numbers, tenant names, unit types, square feet, market rents versus actual rent, deposit amounts held, move-in date and lease-start dates, plus lease-end dates and current status.

What is a rent roll?‍

Rent roll is a document that has various details about each of the units in an apartment building or multi-family housing complex or a commercial building such as office spaces and shopping centers. 

This document includes information such as the rent of each apartment, tenant names, square footage area, type of unit, move in and move out dates of tenants, etc. It is an important piece of documentation for property owners and investors. It is a mandatory document to be maintained and provided by owners or property managers to investors as a part of conducting due diligence. 

‍What are the details included in a rent roll?‍

A rent roll document includes a lot of information that is useful to calculate the annual rental income and the vacancy rate. The details included in a rent roll are:

1. Property information

• Property owner’s name or property management company’s name
• Address
• Type (multi-family, single-family or commercial)

2. Unit information

• Number of the unit (unit 1, 2, 3 and so on)
• Area or square footage
• Number of bedrooms and bathrooms
• Lot size and information about other amenities

3. Tenant information

• Name of tenant
• Monthly rent amount
• Rent due date
• Move in and move out date
• Any rent amount due (if applicable)
• Any prepaid rent amount (if applicable)
• Lease start and end date
• Rent concessions of provided by landlord

Why is rent roll important?‍

Rent roll is an important document for property owners to analyze the performance of the property. It not only determines the annual rental income but also provides valuable information for calculating the gross income, gross rent multiplier, Internal Rate of Return (IRR), net operating income and cap rate. 

Furthermore, the rent roll information is also used to get information about the tenants of the property as the profile of tenants may indicate the sophistication of the property. Additionally it also determines the safety of the locality. Apart from this, the information in the rent roll is also useful for future owners of the property to compare the performance of the property with other similar properties in the area and compare the market rates. 

This document is also important to investors to conduct due diligence on their part before they choose to invest in the property. This is especially important for commercial properties with high or low vacancy/occupancy rate. 

Who uses the rent roll?‍

Rent roll is used by property owners, property managers, investors, buyers and sellers to evaluate the performance of the property and calculate various elements that will help their decision making. Additionally, this document is also used by banks and other lenders to evaluate the value of the property and if it is viable to sanction the loan for that particular property. This is also useful when property owners want to refinance. 

Conclusion‍

The details enclosed in a rent roll are highly valuable and detailed for each separate unit. There is no said format that property owners follow but the basic details remain the same in every rent roll created. Previously, this information was recorded on paper, however, with changes in technology, this information is now typically recorded on Excel spreadsheets. It is absolutely mandatory to keep this information updated at all times and passed onto the next owner or investor or lender as and when required.