Rent Roll Analysis

Rent roll analysis reviews tenant lease terms, income verification, and occupancy trends for replacement property candidates Denver, Colorado investors are considering within a Section 1031 exchange. A rent roll is the primary financial document underlying any income producing property's valuation, listing each tenant, unit or space, current rent, lease start and expiration date, and any concessions or arrears, and errors or gaps in that document can materially misstate the income an investor should expect to receive after closing.

We review the rent roll against available lease documents to confirm that stated rents, square footage, and lease terms match what is actually documented, since rent rolls prepared by a seller's broker occasionally contain outdated figures, particularly for units that have turned over recently or tenants who have negotiated informal rent concessions not yet reflected in the seller's records. Where lease documents are not immediately available for every tenant, we flag which figures on the rent roll remain unverified so the investor understands what has been confirmed versus what is still assumed.

Verifying income and identifying rollover risk

Beyond confirming that current rent matches lease documentation, we compare current rent to market rent for comparable space in the trade area, since a rent roll showing rents significantly below market may indicate upside through lease renewal or turnover, while rents significantly above market may indicate risk of tenant departure or difficulty renewing at the current rate. This comparison shapes both the offer price and the investor's expectations for income growth or risk over the hold period.

Lease expiration schedule is reviewed to identify rollover concentration, meaning how much of the rent roll expires within any given year of the investor's anticipated hold period. A property where a large share of leases expire in the same year the investor plans to refinance or sell carries meaningfully different risk than a property with staggered expirations, even if both show identical current income, and we surface this concentration clearly rather than leaving it buried in a spreadsheet of individual lease dates.

Occupancy trend and arrears review

We review historical occupancy trend where available, since a rent roll is a snapshot of a single point in time and does not on its own reveal whether occupancy has been stable, improving, or declining. Combined with trailing financial statements, occupancy trend analysis helps distinguish a property with durable income from one where current occupancy happens to be a high point that may not persist. Tenant arrears and any pending eviction or collection matters are reviewed as well, since unresolved arrears can indicate tenant financial distress that a current rent roll figure alone would not show.

Because rent roll analysis feeds directly into underwriting, lender loan sizing, and the investor's decision about whether to proceed with identification, we complete this review as early as possible on serious candidates so findings can influence the identification list rather than surface after a property is already identified. This service supports underwriting and diligence coordination and is not legal, tax, or investment advice; Denver, Colorado investors should confirm final figures with their lender and CPA before closing.

Denver's rental market has experienced meaningful rent growth and, more recently, periods of moderation across different submarkets and property types, which makes current-to-market rent comparison particularly important for local replacement candidates rather than assuming trailing rent figures reflect where the market stands today. We apply this same rigor to out of state candidates a Denver, Colorado investor may be comparing, ensuring the investor is weighing genuinely comparable income pictures across markets rather than a locally-informed intuition against an unfamiliar market's raw numbers.

We also cross reference the rent roll against the seller's trailing financial statements to confirm the two documents are internally consistent, since a rent roll showing higher income than what the T12 financial statement reflects for the same period can indicate collection issues, unrecorded concessions, or simple reporting errors that deserve clarification before the investor relies on either document for underwriting purposes.

For properties with month to month or short term tenants, we pay particular attention to how consistently those units have stayed occupied historically, since a rent roll dominated by short term tenancies carries meaningfully different income stability than one built primarily on multi-year leases, even when both show full occupancy on the date the rent roll was pulled.