The do's and don'ts of buying a rent roll
The primary factors in determining rent roll value include
- Having last financial year set of accounts ready and available. Often this is a factor overlooked and mid due diligence it is required by buyer and buyer’s bank or accountant
- Having a strong team around you ie; bank on board with finance, legal’s and accounting.
- Completing strong due diligence on rent roll acquisition. In the vendor’s case this should be done prior to selling to ensure their book is clean and up to scratch
- Clauses including restraint of trade, retention, finance and due diligence on formal offer are all important
- Retaining staff where possible, particularly the property managers who hold key relationships with owner clients and will ensure attrition is minimised
- NDA’s or confidentiality agreements signed prior to providing any information to potential buyers. Information on acquisition is sensitive and should be treated so
- Ensuring all properties have management agreements and assignment clauses
