Because a rent roll transaction is largely the transition of relationships, the way the landlords are informed and managed is vital to the success of any rent roll sale.
In terms of the landlord’s options at this juncture, the rules vary from state to state. In Victoria for example, the landlords on the rent roll are given notice by the Vendor selling the rent roll that the assignment will happen within 14 days should they not object to the assignment. In N.S.W. the requirement is to obtain a new authority in the name of the purchaser.
If the sale goes through, the landlord can potentially end up without an agent representing their property, meaning they have to find another agency to manage them. This scenario is not ideal for the buyer, the vendor or the landlord themselves.
There are many downsides in a rent roll sale to a reluctant landlord, however there are several ways to ensure your landlords are comfortable with the changes and happy for the transition to take place.
Landlords, like the rest of us, prefer the status quo to having to make a change – so the simplest way to manage the transition is to make sure as little as possible will change from the landlord’s perspective.
Systems and processes
When the vendor and the buyer are well matched, the potential for any landlord-facing communication to remain as familiar as possible is high. Any changes should be clearly communicated with as much lead time as possible so the landlord can make any adjustments necessary.
Where the transfer of staff is part of the overall transaction, the disruption to the landlord can become minimal – reduced to cosmetic changes such as letterhead/logo updates and the physical location of the agency. The property manager can remain the same familiar face, and as far as the landlord is concerned, it is business as usual.
The vendor can stipulate a period of time where they will remain in contact, either as a consultant or even simply as a ‘friendly face’ to help with the changeover. In this case, the landlord can feel like they have someone who is ‘on their team’ to answer questions and put forward any requests.
The landlords are an intrinsic part of the value of a rent roll. The more comfortable they are with a transition from one agency to another, the smoother the sale will be, and the probability of the landlord remaining is higher.
BDH Solutions have over 30 years experience in rent roll transitions. They know how to prepare and manage the landlords journey from one agency to the next – for our latest listings, subscribe here.