CRE 101 Series

1. 1. What is CRE?
2. 2. The T12
3. 3. NOI Explained
4. 4. Cap Rates
5. 5. Property Types
6. 6. How Properties Make Money
7. 7. Lease Structures
8. 8. Financing Fundamentals
9. 9. Key Investment Metrics
10. 10. Valuation Basics
11. 11. Reading a Rent Roll
12. 12. Pro Forma Rent
13. 13. Risk Profiles
14. 14. Due Diligence
15. 15. The Acquisition Process

In This Article

How to Read a Rent Roll: A Beginner's Guide

A rent roll is the single most important document for understanding what a property is actually renting for today. Not what it should rent for, that's a separate question covered in the next chapter, but what's actually happening right now, unit by unit. If you want the basics first, what a rent roll includes and what each field means, start with what a rent roll is.

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What a Rent Roll Is

A rent roll is a unit-by-unit snapshot of a property's occupancy and rent, as of a specific date. It shows who's renting each unit, what they're paying, and the terms of their lease. Think of it as a spreadsheet version of "here's exactly what's happening in this building right now."

It's used constantly across the industry, by investors evaluating a purchase, lenders underwriting a loan, and property managers tracking day-to-day performance.

What a Rent Roll Typically Includes

A rent roll usually lists, for every unit:

• Unit number or identifier
• Unit type (bed/bath count for multifamily, square footage for commercial)
• Tenant name (or "vacant")
• Current rent
• Lease start and end dates
• Security deposit
• Sometimes: other charges, like parking, pet rent, or storage fees

How those columns are labeled and ordered depends on the property management system the file came out of, so two rent rolls for similar properties can look nothing alike. DealDuo standardizes unit type, lease status, lease type, and charge categories across those exports, and flags anything it isn't confident about for review.

Here's a simplified example of what that looks like in practice:

Already, a few things stand out from just five rows: unit 102 is vacant, unit 104 is renting for noticeably more than similar units, and units 103 and 105 have the exact same lease end date, which matters if the full rent roll shows a lot more units clustered around that same date.

What to Actually Check When Reading One

Reading a rent roll isn't just about seeing what's on it, it's about knowing what to look for.

Physical occupancy vs. economic occupancy. Physical occupancy is simply how many units are filled, occupied units divided by total units. Economic occupancy is a different calculation: actual collected rent divided by gross potential rent, the rent the property would generate if every unit were leased at full asking rent with nothing uncollected. A property can be fully occupied and still underperforming if tenants are behind on payments or paying reduced rent under a concession, that's exactly the gap economic occupancy is built to reveal. The two numbers can tell very different stories.

Loss-to-lease. This is the gap between what a unit is currently renting for and what it could rent for at today's market rate. If similar units nearby are renting for more than what's on the rent roll, that gap, called loss-to-lease, represents potential upside once those leases turn over. It's also the bridge into the next chapter on pro forma rent.

Lease expiration clustering. If a large share of leases expire in the same few months, that's a concentration of turnover risk, a lot of units could come up for renewal (or non-renewal) all at once. A rent roll with expirations spread evenly across the calendar is generally lower risk than one with a pile-up in a single quarter.

Vacant units, and how long they've been vacant. A unit being vacant today isn't the same as a unit that's been vacant for eight months. The rent roll alone may not show vacancy duration, but ask about it, since a long-vacant unit often signals a pricing or condition problem, not just bad luck.

Tenant concentration. This matters more for commercial properties than multifamily. If one tenant accounts for a large share of a property's total rent, the property's performance is effectively tied to that one tenant's business staying healthy. A rent roll with dozens of small tenants (typical multifamily) carries very different risk than one with a single tenant occupying most of the space.

A Note on Accuracy

A rent roll is a claim, not proof. It's typically provided by the seller or property manager, and it's only as reliable as whoever put it together. Before relying on it, cross-check against other sources: Actual bank deposits, the T12 operating statement, or lease documents themselves, to confirm the numbers on the page match what's actually happening.

Common Mistakes

• Trusting the rent roll at face value without verification. A rent roll is a starting point for due diligence, not the finish line.
• Missing lease expiration clustering. A rent roll that looks stable at a glance can still be hiding a wave of expirations a few months out.
• Confusing "vacant" with "recently vacant." A unit that's been sitting empty for months is a different problem than one that just turned over, even though both show up the same way on the page.

FAQ