What is included in a rent roll?

For each tenancy: the tenant's name, the space and its area, the current rent, the lease start and expiry dates, any options to renew or break, the dates and basis of rent reviews, incentives such as rent-free periods or fit-out contributions, how outgoings are shared, the bond or guarantee held, and any arrears. A schedule for a lender also shows vacant space, so the total area reconciles with the building.

Is a rent roll the same as a tenancy schedule?

In practice, yes. Rent roll is the more common name in North America; tenancy schedule is the usual term in UK valuation and lending, and both are used in Australia and New Zealand. Both describe one line for each tenancy with its terms. In Australia and New Zealand rent roll also names something else: a real estate agency's book of managed properties, which is bought, sold and lent against as a business asset. What matters to a lender is who prepared the schedule and the date it speaks to.

How does a lender verify a rent roll?

By testing it against three other sources. The leases show what each tenant has agreed to pay and when. Bank statements or the managing agent's ledger show what has actually been received. The valuer's report gives an independent reading of the tenancies and the market rent. Larger loans may add written confirmations from the main tenants of their rent and lease terms, and a review of the leases by the lender's lawyers.

What is the difference between headline rent and effective rent?

Headline rent is the rent the lease sets. Effective rent is what the landlord receives once incentives are taken into account: a rent-free period, a cash contribution to the tenant's fit-out or a discount for the first years. Passing rent, the rent payable today, can sit below the headline figure while a rent-free period runs. A shop with a headline rent of US$100,000 and a year rent-free on a five-year lease has an effective rent of about US$80,000, and the lender reads the lower figure.

// WORKED EXAMPLEWHAT THE DOCUMENT DOES

Rent Roll: What a Property Lender Reads in It

The income behind the valuation, one lease at a time.

BY MICHAEL SHANG · SIXTEEN YEARS IN COMMERCIAL BANKING · UPDATED 2026-11-07

// THE SHORT ANSWER

A rent roll is where a property lender finds out whether the rent it is lending against is real, collectable and likely to last. Every income figure in the credit paper, from net operating income to interest cover to the valuer's capitalised value, starts from that schedule. The lender's work is to turn the total at the bottom into the income it will actually rely on: rent being paid now, by tenants independent of the borrower, under leases that run long enough. The figure that survives is usually smaller than the one the borrower sent, and the size of the gap is itself information.

BASIS Practitioner judgment from sixteen years in commercial banking, set out in How Bankers Think (Highbank Press, 2026). Every borrower on this site is a composite constructed for teaching, not a client. The market is mid-market commercial lending as practised in New Zealand and Australia; where a convention differs elsewhere, the page says so.

// MAKE THE CALL

Issue 08 — Basalt Ridge Developments. A new-to-bank developer, a claimed 28% ROE and two other banks circling. Your bank has a growth target. Your call first, then the senior banker's.

Read the file →

// 01 — WHY THE LENDER STARTS WITH THE SCHEDULE

An investment property loan is repaid from rent while it runs and from a sale or refinance when it ends, and both depend on the same leases. The valuer capitalises the rent to reach a value; the lender divides the rent by the interest to reach cover; the next lender, years later, will read the leases then in place. If the schedule is wrong, every ratio built on it is wrong in the same direction.

The schedule usually comes from the borrower or its managing agent, and it describes the tenancies as the owner would like them to be read. A lender therefore treats it as a claim to be tested, not a fact to be copied, and the testing is done against the leases themselves, the record of rent received, and the valuer's own reading of the tenancies.

// 02 — WHAT EACH COLUMN TELLS A LENDER

Tenant and area say who pays and for how much space, and so how much of the income rests on one name. The rent column needs its definition read first. Headline or contracted rent is the figure the lease sets; passing rent, on most definitions, is what is payable today, which is less while a tenant is in a rent-free period or on a discount; and effective rent spreads every incentive over the term. A schedule that shows only the headline figure is where incentives hide. Lease start and expiry, with any break option, give the term the income is secured for and feed the weighted average lease expiry.

Review dates and their basis say whether the rent will rise by a fixed step, with inflation, or to market, and whether a market review can push it down. The outgoings column says whether tenants repay rates, insurance and maintenance or the owner carries them. Arrears say who is already late. And the bond or bank guarantee held, if any, says what the owner can draw on if a tenant stops paying.

// 03 — THE EXAMPLE

A neighbourhood shopping centre, constructed for this page like every figure in it, has a supermarket and ten specialty shops. Its owner asks for a loan of US$16m and sends a rent roll totalling US$2.1m a year: US$0.9m from the supermarket, with eleven years to run, and US$1.2m from the shops. Read against the leases and twelve months of bank statements, three entries change:

Rent roll, headline rent 2,100,000

Two shops in rent-free periods, six months to run − 70,000

Café let to the owner's company, above market − 50,000

Florist 90 days in arrears − 60,000

Rent the lender relies on in year one 1,920,000

The two new shops pay a combined US$140,000 a year once their rent-free months end, so half a year is lost. The café is let to a company the owner controls at US$120,000, where the valuer puts the market rent at US$70,000; the lender counts the market figure, because a related tenant's rent is set by the borrower. The florist's rent is left out until the arrears are cleared. With US$180,000 of outgoings the tenants do not repay, and interest at 6.8%:

On the roll: (2.10 − 0.18) ÷ 1.088 = 1.92 ÷ 1.088 = 1.76×

As read: (1.92 − 0.18) ÷ 1.088 = 1.74 ÷ 1.088 = 1.60×

Nothing on the schedule was false. Each line described a lease that exists. The adjustments come from reading what the leases say about when rent starts, who sets it and whether it arrives. The roll also shows four shop leases, US$400,000 of rent, ending within eighteen months, which the lender reads as the next question rather than an adjustment.

// 04 — WHAT A LENDER READS BESIDE IT

The rent roll is a list of contracts on one date. The record of rent received, in the bank statements or the managing agent's ledger, shows whether the contracts are being honoured. The leases are the legal source, and where a lease and the schedule disagree, the lease governs. The valuation report is a third reading of the same tenancies by someone the lender instructed, and a valuer who has assumed a market rent below the passing rent has told the lender something the schedule does not.

A tenant who is also the borrower, a director or a company they control needs a separate read, because its rent, its renewal and its arrears are all within the borrower's own gift. That is the reason related-party transactions are a standing question in any file.

DEFINED IN ONE PARAGRAPH → · CAPITALISATION RATE → · DEBT YIELD →

// 05 — WHERE IT DECIDES A FILE

It decides the size of the loan. A lender that sizes on interest cover sizes on the income as read, not as sent, and in the example that is about a tenth less income and a tenth less cover. It decides the conditions, too: copies of the main leases, a rent roll certified by the borrower, and the arrears cleared before drawdown are common requests. And it decides the reporting, since many investment facilities ask for an updated schedule each quarter or half-year, so that a vacancy or a rising arrears column reaches the lender before the interest cover test does.

Through the life of the loan, the schedule is the early warning. A tenant moving onto monthly terms, a rent-free period granted to keep a shop open, or a related company taking vacant space at a full rent are all visible there first. A desk that compares each new rent roll with the last one reads the changes, not the totals.

WHAT TO SEND YOUR BANK EACH MONTH → · LVR, SECURITY AND COLLATERAL →

// QUESTIONS PEOPLE ASK

What is included in a rent roll?: For each tenancy: the tenant's name, the space and its area, the current rent, the lease start and expiry dates, any options to renew or break, the dates and basis of rent reviews, incentives such as rent-free periods or fit-out contributions, how outgoings are shared, the bond or guarantee held, and any arrears. A schedule for a lender also shows vacant space, so the total area reconciles with the building.
Is a rent roll the same as a tenancy schedule?: In practice, yes. Rent roll is the more common name in North America; tenancy schedule is the usual term in UK valuation and lending, and both are used in Australia and New Zealand. Both describe one line for each tenancy with its terms. In Australia and New Zealand rent roll also names something else: a real estate agency's book of managed properties, which is bought, sold and lent against as a business asset. What matters to a lender is who prepared the schedule and the date it speaks to.
How does a lender verify a rent roll?: By testing it against three other sources. The leases show what each tenant has agreed to pay and when. Bank statements or the managing agent's ledger show what has actually been received. The valuer's report gives an independent reading of the tenancies and the market rent. Larger loans may add written confirmations from the main tenants of their rent and lease terms, and a review of the leases by the lender's lawyers.
What is the difference between headline rent and effective rent?: Headline rent is the rent the lease sets. Effective rent is what the landlord receives once incentives are taken into account: a rent-free period, a cash contribution to the tenant's fit-out or a discount for the first years. Passing rent, the rent payable today, can sit below the headline figure while a rent-free period runs. A shop with a headline rent of US$100,000 and a year rent-free on a five-year lease has an effective rent of about US$80,000, and the lender reads the lower figure.

THE IN-TRAY · ONE MINUTE

Make the call on one file.

A short file on the ground this page covers. Every option opens with how far it sits from a senior banker’s read.

THE NUMBER · THE ECONOMY · COLLATERAL MARKETS

A bank lent 65% of the value of a factory valued at US$10m. If it has to sell, it expects a forced-sale discount of 30%, and selling costs of 5% of the sale price.