Canonical page: https://sequoia-research.com/writing/dst-due-diligence-how-to-reconcile-the-rent-roll-with-major-leases
Author: Sequoia Research
Published: 2026-10-18T00:45:06.081Z
Updated: 2026-10-18T00:45:06.081Z

# DST Due Diligence: How to Reconcile the Rent Roll With Major Leases

## What Is This Article About?

This article explains how to compare a Delaware statutory trust (DST) property's rent roll with the leases behind its largest income sources. It covers tenant names, space, rent dates, increases, concessions, and other terms that a summary may leave out. A defined fictional sample shows how to separate a valid difference in measurement from an error that needs correction. The review ends with a record of what matched, what did not, and which leases were outside the sample.

## Table of Contents

- [Understand What the Rent Roll Measures](#understand-what-the-rent-roll-measures)
- [Choose and Describe the Major-Lease Sample](#choose-and-describe-the-major-lease-sample)
- [Collect the Lease and Its Changes](#collect-the-lease-and-its-changes)
- [Match the Tenant and the Space](#match-the-tenant-and-the-space)
- [Separate Lease Dates From Rent Dates](#separate-lease-dates-from-rent-dates)
- [Rebuild Base Rent for the Review Period](#rebuild-base-rent-for-the-review-period)
- [Keep Concessions and Other Charges Separate](#keep-concessions-and-other-charges-separate)
- [Compare Contract Rent With Billing and Cash](#compare-contract-rent-with-billing-and-cash)
- [Check Renewal and Termination Assumptions](#check-renewal-and-termination-assumptions)
- [Carry Differences Into the DST Cash Model](#carry-differences-into-the-dst-cash-model)
- [Record Unresolved Lease Questions and Sample Limits](#record-unresolved-lease-questions-and-sample-limits)
- [FAQ](#faq)
- [About Sequoia Research](#about-sequoia-research)
- [Sources](#sources)

## Understand What the Rent Roll Measures

A rent roll is a summary of tenancy and rent information for a property at a stated time. It can help you see who occupies the space, how much rent is listed, and when terms end. It does not replace the underlying leases or show every condition that affects the cash a property may receive.

Start by asking what each column means. A column called annual rent might show the current month's base rent multiplied by twelve. It might instead show scheduled rent for the coming calendar year. Those numbers can differ when an increase, concession, or end date falls within the year. The label alone is not enough.

Record the rent roll's effective date and the date you received it. The first identifies the snapshot. The second identifies your access to it. A file received in October can still describe June. If the investment model uses a later date, note that gap before comparing the figures.

Also ask whether the roll includes signed future leases, occupied space, holdover tenants, or only rent-paying tenants. A signed lease with a later move-in date may appear differently from an occupied unit. The definitions should explain those states. Do not treat every nonzero area row as proof of current rent receipts.

The Securities and Exchange Commission (SEC) notes that private placements may offer less information than registered investments. Its bulletin was updated September 21, 2026. A rent roll is useful evidence within that limited file, but a detailed spreadsheet does not establish that all supporting records were supplied or checked. [SEC private-placement bulletin](https://www.investor.gov/introduction-investing/general-resources/news-alerts/alerts-bulletins/investor-bulletins/private-placements-under-regulation-d-updated-investor-bulletin).

Decide what you are trying to reconcile. A narrow review might compare tenant identity, area, base rent, and term dates for the largest leases. A broader review might also examine reimbursements, guaranties, options, and collections. State that scope before work begins so a limited check does not later become a claim that the entire property income was audited.

## Choose and Describe the Major-Lease Sample

“Major leases reviewed” is incomplete without a selection rule. You might select the largest annual base-rent sources, the leases covering most of the space, or leases with near-term changes. Each method can identify different records. Explain why the chosen sample fits the question you are trying to answer.

A large-rent sample can reveal concentrated income exposure. A near-expiry sample can reveal timing risk even when each tenant is small. A related-tenant or unusual-term sample can address a different concern. These are purposeful selections, not automatically a statistical sample that supports conclusions about every other lease.

The following original case uses a fictional property called Willow Works. Its planning rent roll is dated January 1, 2027. All names, rents, space amounts, and lease terms in this case are invented. This is not a review of a current DST's private lease file.

| Fictional tenant or space | Listed area | Annualized base rent on the planning roll |
| --- | ---: | ---: |
| Aster Fabrication LLC | 40,000 square feet | $480,000 |
| Beacon Labs LLC | 25,000 square feet | $375,000 |
| Cedar Logistics LLC | 15,000 square feet | $180,000 |
| Delta Services LLC | 10,000 square feet | $120,000 |
| Vacant space | 10,000 square feet | $0 |
| Total | 100,000 square feet | $1,155,000 |

The defined sample covers Aster and Beacon because they have the two largest listed base rents. Their combined 65,000 square feet is 65% of all listed space and about 72.22% of the 90,000 square feet listed as leased. Their $855,000 annualized base rent is about 74.03% of the roll's $1,155,000 total.

Those are coverage measures. They do not mean that 74.03% of future cash has been verified. The annualized amounts are still subject to the terms being checked. The other two tenants' leases remain outside this sample, and the vacant space has no base-rent amount in the model.

Keep both the number of leases and the income coverage in the scope note. Two of four tenant leases is 50% by count, yet nearly three-quarters by the chosen rent measure. Both statements are true. Neither should be substituted for the other to make the work look broader.

If you expand the sample, record the reason and the added rows. A discrepancy in one major lease may justify looking at other leases with the same feature. Do not silently increase the scope and then claim that the original selection rule produced the broader coverage.

## Collect the Lease and Its Changes

Ask for the lease packet for each selected tenant. That means the base lease and the later records that can change the terms under review. These may include amendments, commencement confirmations, assignment documents, or notices relevant to a claimed option. Which records matter depends on the actual contract and issue.

Make an index in date order. Give each document a short reference, its stated date, the parties, and the sections it changes. An unsigned draft belongs in a separate state from an executed document. A date in the file name may be a download date, so check the document itself.

A real public example shows why the chain matters. Box's seventh office-lease amendment, dated August 21, 2026, extends only specified renewal premises from July 1, 2028 through June 30, 2040. Other space keeps the June 30, 2028 expiry. Separate sections address remeasured area, scheduled rent, and conditional base-rent abatement. The abatement can be shifted under stated notice and timing conditions. A single tenant-wide end date or unadjusted rent-table row would miss those distinctions. This is a narrow example from one public amendment, not a DST rent-roll review or a finding about Box's actual payments. [Box lease amendment, sections 2–6](https://www.sec.gov/Archives/edgar/data/1372612/000119312526368289/box-ex10_2.htm).

Do not assume that a later document replaces the entire lease. It may change one term and preserve the rest. Record which terms remain tied to the earlier document. If the effect is unclear, ask the appropriate legal reviewer rather than choosing the page with the newest date.

A missing amendment can limit several checks at once. Mark the affected rent, term, and area rows as dependent on that missing record. Avoid issuing separate clean conclusions for each field while overlooking the same missing support underneath all of them.

The Financial Industry Regulatory Authority (FINRA) addresses reasonable investigation of private offerings and additional primary records in its May 2023 guidance. The duties discussed apply to covered firms and circumstances. The sample method here helps a reader frame evidence requests; it does not establish that a firm's investigation is complete. [FINRA Regulatory Notice 23-08](https://www.finra.org/rules-guidance/notices/23-08).

## Match the Tenant and the Space

Match the legal tenant name before matching the rent. A rent roll may use a store name, a parent brand, or an abbreviation. The lease identifies a contracting party. Record how the short name connects to that party, and keep an unresolved identity gap visible.

A guarantor is a separate question. A familiar parent name in marketing material does not by itself establish that the parent guarantees the lease. If a guaranty is supplied, identify the document, parties, scope, and any limits relevant to the review. Have the appropriate professional interpret the legal effect.

Match the premises with equal care. Record the building, suite, floor, or other description used in the lease and compare it with the rent-roll row. A tenant may occupy several spaces with different terms. A combined row can hide a portion that is due to be returned while another portion continues.

Area is a defined measure. Ask whether it is rentable, usable, or another stated basis. Do not compare two numbers with different definitions and call the difference an error. If an amendment changes the agreed area at a future date, retain both the current and future amounts with their effective dates.

In the Willow Works case, the sample assumes that the two legal tenant names and the stated areas match their invented lease records. That assumption is supplied for teaching. It is not a claim that a name match proves the tenant's credit strength, payment history, or ability to perform the lease.

Consider a separate area example. A draft roll lists 20,000 square feet, while a later source uses 19,500. At a stated annual base-rent rate of $18 per square foot, those amounts produce $360,000 and $351,000. The $9,000 difference shows the effect if that rate truly applies to the relevant area. It does not determine which area governs.

Also check whether the lease fixes a dollar rent rather than requiring a fresh area-based calculation. If the contract specifies a fixed monthly amount, multiplying a different area by a displayed rounded rate may produce an apparent discrepancy that has no contractual effect. Preserve both the formula and the stated amount until their relationship is clear.

## Separate Lease Dates From Rent Dates

A lease can have several dates that matter. The signing date, delivery date, lease commencement date, rent commencement date, increase dates, and expiry date may differ. Copy each date with its label and source. Do not place all of them under a single “start date” heading.

Some dates depend on an event. A term may begin after delivery, completion of work, or another defined condition. In that case, an estimated date in the rent roll needs a separate evidence state. Ask what record establishes that the trigger occurred and whether the final date has been confirmed.

A tenant may have access to space before full base rent is due. Conversely, a payment obligation may continue after some physical use ends. These possibilities make occupancy and payment different questions. Read the specific terms instead of assuming that a move-in photograph establishes the rent-start date.

For the fictional Willow Works sample, Aster pays $40,000 monthly base rent for January through June 2027. A stated 3% increase takes effect July 1, raising the monthly amount to $41,200 for July through December. Beacon's stated monthly base rent is $31,250, but its invented lease waives base rent for January and February 2027.

The planning roll's annualized figures use the stated starting monthly base amounts multiplied by twelve. In this example, that definition deliberately ignores within-year increases and abatements. The roll can therefore be accurate on its own terms while differing from the scheduled cash rent for the calendar year.

Do not call that a reconciliation failure before checking the definitions. The failure would arise if someone used the annualized snapshot as the calendar-year cash forecast without making the stated adjustments. The review should explain the bridge between the two measures, rather than declaring that one must always equal the other.

## Rebuild Base Rent for the Review Period

Build a period schedule from the applicable terms. For a simple monthly lease, list the amount due in each month of the review year. Mark changes where they occur. This exposes an increase in midyear, a free-rent month, or an expiry before the final month that an annual total may hide.

Aster's first six months total $240,000. Its final six months total $247,200. The scheduled full-year base rent is therefore $487,200. Multiplying the starting $40,000 by twelve gives the roll's $480,000 annualized measure, which is $7,200 below that scheduled amount.

Beacon's ten charged months at $31,250 total $312,500. The two waived months account for $62,500 of base rent that appears in its $375,000 annualized figure but is not scheduled to be paid under the example's terms. Do not subtract the waiver twice after using only ten charged months.

The two leases together produce $799,700 of scheduled calendar-year base rent: $487,200 plus $312,500. That is $55,300 below their combined $855,000 annualized amount. The net difference combines Aster's $7,200 increase with Beacon's $62,500 abatement. It is about 6.47% of the sample's annualized amount, not of the entire property's value.

| Fictional sample lease | Roll annualized base rent | Scheduled calendar-year base rent | Scheduled amount minus roll amount |
| --- | ---: | ---: | ---: |
| Aster | $480,000 | $487,200 | $7,200 |
| Beacon | $375,000 | $312,500 | −$62,500 |
| Sample total | $855,000 | $799,700 | −$55,300 |

These calculations assume full months and only the stated terms. They do not forecast collections or cover the other tenants. A real schedule may need daily proration, a partial month, or another contract convention. Use the actual rule rather than choosing a convention that makes a total match.

Keep any rounded rate separate from the authoritative dollar schedule. If a document provides both a monthly rent and a rate per square foot, identify which controls if the figures do not multiply exactly. A small rounding difference needs a different explanation from a missing increase or a whole waived month.

## Keep Concessions and Other Charges Separate

A base-rent waiver does not tell you what happens to every other charge. Check the terms for taxes, insurance, operating costs, parking, utilities, or other amounts. Each charge may have its own start date, limits, payment basis, and reconciliation process. Treating all charges as base rent can distort both the roll and the cash model.

Extend the invented Beacon example by assuming that a separate $5,000 monthly charge remains due during all twelve months. Its annual amount is $60,000. Combined with $312,500 of scheduled base rent, that produces $372,500 of scheduled charges for these two items. It does not turn the waived $62,500 of base rent back into income.

That result follows the stated assumption that only base rent is waived. A real lease might use different terms. The reviewer should cite the specific clause and check for an amendment that changes it. An unexplained label such as “gross rent” should not be used to settle the question.

Also separate rent concessions from work allowances and cash payments to the tenant. An allowance paid for work may affect the property budget in a different period from free rent. If the investment model subtracts both, make sure they are separate obligations. If one already includes the other, count the cost only once.

Track conditions attached to a concession. A schedule may assume that a condition will be met even when the file does not yet show that result. Label the amount as conditional and explain the evidence still needed. Do not remove the condition simply because a spreadsheet needs one number.

A clear workpaper can use one row for base rent, another for additional charges, and another for a work allowance. Give each row a source, timing rule, and treatment in the model. This is more useful than one combined figure that conceals why cash rises or falls.

## Compare Contract Rent With Billing and Cash

A lease schedule answers what is due under the reviewed terms. A billing record answers what was charged. A collection record answers what was received and how it was applied. These are linked checks, but they are not the same check. A clean contract schedule cannot establish that cash arrived.

For an original timing example, suppose Aster owes $40,000 for June. It pays $35,000 in June and the remaining $5,000 in July. At June 30, the unpaid June balance is $5,000. That is a timing gap in this example, not proof that $5,000 will never be collected.

If records later show that the July payment was applied to June, the old balance can be cleared as of that later evidence date. Keep the June snapshot intact. July's separate $41,200 base-rent charge still needs its own check; receiving the late $5,000 does not establish payment of the new month's rent.

Match payment dates, amounts, tenant identity, and the period to which each payment was applied. A deposit may cover several charges or several months. It may also be a security deposit or another receipt. Do not classify every bank receipt from a tenant as base rent without support.

If billing and the lease schedule differ, ask whether there is an omitted amendment, a billing error, a credit, or an unresolved dispute. These are questions to test, not reasons to choose before reading the records. Preserve the difference and the response rather than forcing the figures to match.

The scope of access also matters. A lease-only review may never reach billing or bank evidence. Its conclusion should say that the contract schedule was compared with the rent roll for the selected leases. It should not say that income or collections were verified. The narrower wording tells the next reviewer exactly what remains.

## Check Renewal and Termination Assumptions

An option to renew is different from an exercised renewal. Record the right, the person who can use it, the required timing, and the evidence of exercise. Then ask the legal reviewer whether the supplied records support the term shown in the model. Do not assume that a tenant's current presence proves a future renewal.

A rent roll might show the final possible expiry after all options. Another might show the end of the current committed term. Those dates serve different purposes. Label both if the evidence supports them, and identify which one the cash forecast uses. A longer date should not hide an earlier decision point.

The same care applies to early termination rights. Record the conditions relevant to the model, any notice requirement, and any payment tied to the right. A contract's existence does not mean that a party has invoked it. An informal statement of intent does not by itself settle whether the legal conditions have been met.

For a separate fictional case, a lease ends March 31 and pays $10,000 monthly base rent. The current committed period produces $30,000 for January through March. A twelve-month model at that rate would produce $120,000. The $90,000 difference represents nine further months that need a stated renewal or replacement assumption; it is not automatically a loss.

Model that assumption openly. Identify the expected new rent, downtime, concessions, and work costs where relevant. A scenario can help show the effect of uncertainty, but it is still a scenario. Do not present an assumed replacement tenant as a signed lease or attach a probability without a supported basis.

Give near-term lease decisions a place in the review calendar. The reason is practical: an unresolved renewal can affect the period the investor is studying. A reminder does not determine a contractual deadline or ensure that a required notice was sent. Those facts still need their own support.

## Carry Differences Into the DST Cash Model

Once the lease schedule is clear, trace its totals into the investment model. Identify the exact line, period, and version that uses the rent-roll data. A corrected workpaper has little value if the final forecast still uses the old annualized figure without adjustment.

For Willow Works, the selected leases have $799,700 of scheduled calendar-year base rent rather than $855,000 of annualized snapshot rent. Their $55,300 difference should be explained in the base-rent bridge. Keep the other leases' $300,000 annualized amount separate because their terms were outside this review.

It would be misleading to add that unreviewed $300,000 to the sample schedule and call the result fully checked property income. The arithmetic would yield $1,099,700, but the two parts have different evidence states and may use different time definitions. Label any combined planning figure accordingly until the remaining leases are reconciled.

Then follow the model's treatment of additional charges, vacancies, collection assumptions, expenses, reserves, and debt payments. A base-rent adjustment is one input. It does not establish the amount available to the trust or the amount distributed to an investor. Other changes may increase, reduce, or delay its effect.

Avoid subtracting the same concession in two places. If Beacon's base-rent schedule already uses only ten charged months, do not also subtract $62,500 as a separate free-rent expense from that same subtotal. A visible bridge from starting rent to scheduled rent helps a second reviewer find this kind of double count.

Retain the old and revised model versions. Record who changed the input, which source supported it, and what downstream output was recalculated. If the sponsor uses a different treatment, ask for its explanation and assumptions. Do not rewrite a sponsor's published forecast and present your own version as its official projection.

## Record Unresolved Lease Questions and Sample Limits

Close the review with a short list of supported matches and open differences. For each selected lease, name the rent-roll version, the lease packet, the review period, and the fields checked. A reader should be able to reconstruct the work without guessing which file was used.

An open item needs a precise question. “Please confirm Beacon rent” is broad. “Does the January–February waiver apply only to base rent, and which executed clause supports the $5,000 monthly charge during those months?” identifies the amount, period, and missing link. It also makes a later reply easier to evaluate.

A response can resolve one part while leaving another open. The source might establish the amount but not the effective date. Mark the supported part and retain the gap. Do not turn receipt of a response into a completed reconciliation simply to clear the list.

Decide whether a difference calls for more sampling. If the rent-roll definition was misunderstood, every row that uses the same definition may need another look. If a single lease has a unique amendment, the response may be narrower. Explain the reason for expanding or keeping the sample instead of treating either choice as automatic.

The final note should also say what was not tested. For Willow Works, that includes the other two lease packets, actual collections, tenant credit, and the full property cash model. Those limits are central to the finding. They prevent a useful two-lease comparison from being read as an audit of the investment.

Use the results to ask better questions and decide what evidence matters next. A matching rent figure is helpful, but it cannot settle every property, sponsor, debt, or investor-fit issue. The value of this review is a traceable explanation of the selected rent assumptions and the uncertainty that remains.

## FAQ

### What Is a Rent Roll in DST Due Diligence?

It is a dated summary of property tenancy and rent information. Its columns need definitions because annualized rent, scheduled rent, and collected rent can describe different things. Compare selected rows with the underlying lease records before relying on them for a specific forecast. State which leases and fields were included in that comparison.

### Does the Rent Roll Need to Match the Lease Exactly?

Comparable fields should have an explainable relationship, but totals need not be identical when they use different periods or definitions. A starting monthly rent multiplied by twelve can differ from a calendar-year schedule with a midyear increase. First align the meaning and dates, then investigate any remaining difference.

### How Many Major Leases Should an Investor Review?

There is no single sample size established by this article. Define the purpose and selection rule, then report both lease count and the share of the chosen rent or area measure. A purposeful sample can expose important issues, but it does not automatically justify conclusions about the unreviewed leases or the whole investment.

### Does Free Rent Mean the Tenant Owes Nothing?

Not necessarily. The terms may waive base rent while leaving other charges due, or they may provide a broader concession. Read the applicable lease and amendments, then record the scope and conditions. The fictional Beacon calculation assumes base rent alone is waived; that assumption cannot be applied to a different contract without evidence.

### Can a Lease Review Verify Tenant Collections?

A contract review alone cannot verify receipt of cash. Collections require separate evidence showing what was received, when, and how it was applied. Keep unpaid balances tied to a stated date. A later payment may clear an earlier balance without proving that every later charge has also been paid.

### Should a Renewal Option Be Included in Forecast Rent?

It can be included as a clearly labeled assumption when that is what the model intends. It should not be presented as a committed renewal without supporting evidence. Separate the current term from optional periods, and ask a qualified legal reviewer to assess the records and conditions relevant to any claimed exercise.

### Does a Rent Adjustment Equal a Change in Investor Distributions?

No direct equality is established by this review. A rent adjustment enters a broader model that may include collection timing, other income, operating costs, reserves, and debt obligations. Trace the change through that model before discussing investor effects. Even a revised forecast remains subject to its assumptions and investment risks.

## About Sequoia Research

Sequoia Research creates educational articles and tools for people studying Delaware statutory trust investments. Its work helps readers compare sources, understand assumptions, and frame questions for qualified professionals. This article is general education, not an appraisal, audit, legal opinion, tax opinion, or recommendation to buy a security.

## Sources

- [SEC: Private Placements Under Regulation D](https://www.investor.gov/introduction-investing/general-resources/news-alerts/alerts-bulletins/investor-bulletins/private-placements-under-regulation-d-updated-investor-bulletin), August 17, 2022; updated September 21, 2026. Limited-information context.
- [FINRA Regulatory Notice 23-08](https://www.finra.org/rules-guidance/notices/23-08), May 9, 2023. Covered-firm private-offering investigation context.
- [Box: Seventh Amendment to Office Lease](https://www.sec.gov/Archives/edgar/data/1372612/000119312526368289/box-ex10_2.htm), August 21, 2026, sections 2–6. A bounded example of separate space, term, area, rent, and abatement provisions.


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