TL;DR. I am looking for advice on how I can take appropriate action to warn future landlords and LPs about a deceptive and destructive executive-level tenant who is also a GP on real estate deals.

I rented a fully furnished luxury executive rental in Raleigh to the CEO of a company that builds and operates healthcare facilities. When he vacated the property and returned to his home state, he left under hostile circumstances and left significant damage at the house. I’ve spent $51k so far in the last 65 days on property repairs and replacement. Some of the damages include ~$7,800 of missing property, kitchen cabinet doors ripped off, a mangled chandelier, a damaged refrigerator, divots from a claw hammer in the granite, and urine and feces stains on rugs, furniture, and hardwoods from an unauthorized puppy. The house, appliances, and furnishings were disgusting throughout, and we even found bird droppings on the piano. In short, getting the place restored was akin to remediating damage from a natural disaster.

In the trash and belongings abandoned by the tenant, he also left the OM for his healthcare real estate endeavor, nasty-grams from the IRS about his personal taxes, and collections letters from several creditors after him.

I got burned here and so did my property manager. In retrospect, some yellow flags found by the property manager during the tenant screening are now bright red flashing sirens, but the tenant showed decent credit, had a positive previous landlord reference, wrote a charming cover letter in his application, and applied through the referral of a reputable real estate agent. He was also featured on the local news station for his innovative work.

The tenant is of course taking no responsibility for any of his actions or the damage, and he mainly just throws out empty and somewhat comical threats about a team of lawyers on standby, accusations of insurance fraud, and leaving bad reviews for the property manager.

I am not seeking advice on how to recoup my financial losses. Losing $50k through this is not ideal, but I’m fortunate that it is not a painful sum to lose.

What I am seeking is advice on how to leave evidence in the public record that could be found by future landlords and limited partners vetting the GP, who’s seeking $8M total / $250k each from accredited investors per facility as he seems to have a plan to move around the country opening facilities.

A $57k bill could be a devastating to many landlords, and I want to help prevent them from experiencing a similar situation.

My recent research indicates small claims courts judgements no longer show on someone’s credit report. I originally thought this would be a low cost route to documenting the issues and alerting others. I filed a police report regarding the missing property, but that’s unlikely to lead to a charge and conviction.

So, what action do I need to take to help a future landlord or a potential LP uncover these facts in their due diligence?

Thank you,
Mark Kelley
Raleigh, NC

Raleigh, North Carolina

3 Votes