It should go without saying that CRE pros looking to expand their portfolio with income properties should be focused on, well, the income (or revenue-generating potential) of said properties. But how do you do that without digging through piles of lease documentation?
Enter rent roll.
Let’s discuss why rent roll is critical to your purchasing decision and how commercial lease software can help you determine ROI from prospective properties.
What Is Rent Roll?
Rent roll is the rental revenue of a property. It’s the total gross rent collected from all of the tenants. It can be broken down into more granular metrics like rent per suitet, but overall, it serves as a way to quickly identify both the existing income and the income potential of the property. Common information usually found on a rent roll includes:
- Tenant name
- Lease information (type, start date, expiration date)
- Vacancy information
- Net rentable square feet
- Base rent per month
- Other rent information (escalations, terminations, options, reimbursements, etc.)
Why Rent Roll Is Important
For commercial landlords, investors and property managers, rent roll is the ideal way to determine the “real” income of the property. (Or the bulk of it, anyway, as other income sources like parking and vending may exist.) CRE professionals use rent roll for different reasons.
- Landlords and property managers use this information to forecast and determine whether or not to increase rent, as well as see which tenants may be having trouble paying their rent each month.
- Investors and buyers use this information to determine whether the property is a good investment and if there are ways to increase the rent income.
Basically, rent rolls are a look at the current financial state of the commercial rental property and its future potential revenue.
CRE Software and Prospecting
Rent rolls in themselves are an easier way to evaluate total rental income than if you looked at each individual tenant’s lease agreement. But there are ways to make rent rolls even easier (and more valuable) thanks to commercial lease software. You can set it up so that the rent roll data is automatically calculated each month and that you receive it in a consolidated report that you can access anywhere, any time and from any device. Additionally, this software can provide up-to-date market information that will help you maximize your rent rolls to make smart decisions about adjusting property rent or investing in a property.
Everything from how you organize your leases and track lease options to exporting reports and monitoring rent rolls for your entire portfolio is easy with CRE software. To see it in action for yourself, request a demo of Quarem today.