Due Diligence: Conduct Tenant Interviews

[Charles D. Smith]

While this might not be critical if you’re purchasing an apartment building with many tenants on short-term leases, for multi-tenant commercial properties with tenants who occupy larger spaces, the information you can learn in tenant interviews is invaluable. During a tenant interview, you may discover that there are certain tenants who you expected to renew their leases, only to learn that they have decided not to renew because they have complained about HVAC issues to the current Landlord a dozen times only to have their complaints never addressed. The fix might be something so simple that you may be able to address this right away upon taking ownership and retain that tenant. Or maybe you might find out from talking to your retail tenants that they are all unhappy with the location because the parking is inadequate, and their sales are suffering as a result. This might change your perspective on the deal because it may be an issue you can’t easily resolve. At the end of the day, no one is going to know the property better than your current tenants.