A rent roll is a spreadsheet a seller produced about their own building.
An estoppel certificate is each tenant signing a statement of what they believe they pay, what they were promised, and what the landlord still owes them.
These two documents describe the same property. In our experience they disagree often enough that we treat any deal where estoppels have not come back as a deal that has not actually been underwritten yet.
What an estoppel is for
It is a tenant-verified snapshot of the lease. Typically it confirms the current rent, the remaining term, renewal and expansion options, the security deposit actually held, any concessions still owed, whether the tenant claims the landlord is in default, and whether any side agreements exist outside the written lease.
The point is that it binds the tenant to that statement. Once they sign it, they generally cannot turn around after closing and assert something different. The rent roll gives you no such protection, because the person who wrote it is the person leaving.
What it actually turns up
Here is a single suite from a deal we looked at, as described by each document.
| The rent roll said | The estoppel said | |
|---|---|---|
| Base rent | $8,400 per month | $8,400 per month |
| Free rent remaining | None | Three months, worth $25,200 |
| Tenant improvement allowance | Not mentioned | $45,000 unfunded, landlord owes it |
| Security deposit held | $16,800 | $8,400 |
| Purchase rights | None | Right of first refusal to buy |
Same tenant, same lease, roughly $78,600 of near-term economics that were not in the seller's numbers. None of it was fraud. Concessions get negotiated after a rent roll is built and nobody updates the spreadsheet.
The recurring categories are worth committing to memory: unrecorded concessions, side letters agreed verbally or in a separate document, deposits that do not reconcile, disputed operating expense reconciliations, and claimed landlord defaults such as unfinished work or an unrepaired roof.
The one that can end your exchange
Look again at the last row.
A right of first refusal to purchase means that when you put the property under contract, the tenant can step into your deal on your terms and buy it themselves. You identified this property on day 30. You spent real money on inspections, an appraisal, and legal work. On day 60 the tenant exercises, and you no longer have a replacement property.
Your 45-day window closed a fortnight ago. If this was the only property you identified, the exchange is finished and the gain is taxable. If you used all three slots, you pivot to another one and you are merely annoyed.
That is the single strongest practical argument for identifying three properties, and it is why we push it as hard as we do. A right of first refusal typically lives in the lease, not on the title report, so the only way to find it before day 45 is to read every lease and get every estoppel back.
The timing problem
Estoppels are slow, and the reason is structural: the person who needs them urgently is you, and the people who have to sign them are tenants with no stake in your transaction.
Most leases oblige a tenant to return an estoppel within ten to twenty days of request, but enforcement is weak and practical leverage is thin. Add a portfolio of fifteen tenants and you are looking at weeks, landing squarely inside your identification window.
If you are financing, your lender will separately require subordination, non-disturbance and attornment agreements from major tenants, which is another round of the same slow process with different paper.
So the instruction is unambiguous: request estoppels the day you go under contract, not after inspections clear. Everything else in 45-day diligence can run in parallel. This one cannot be compressed.
What to do with what comes back
- Compare line by line against the rent roll. Not a skim. Every field, every tenant.
- Price the discrepancies. Unfunded tenant improvements and outstanding free rent are usually a credit at closing or a price adjustment, and a seller who refuses both has told you something useful.
- Escalate anything touching purchase rights. A right of first refusal or a purchase option changes whether you can rely on this property at all, and your attorney needs it immediately.
- Watch for the tenant who will not sign. Silence is information. It often means a dispute the seller has not disclosed.
- Keep your backup identification alive until estoppels are clean, because revoking and re-identifying is free before day 45 and impossible afterward.
An exchange that fails because a tenant exercised a purchase right is a genuinely painful way to lose a deferral, mostly because it was discoverable weeks earlier by asking. Building that request into the first day of diligence is exactly what our exchange process is designed to enforce. Your attorney should review the leases and the estoppels for your specific purchase.
Common questions about estoppel certificates
What is an estoppel certificate?
A signed statement from a tenant confirming their lease terms, deposits, concessions, options, and whether they consider the landlord in default. It binds the tenant to that version of the facts.
Why is it better than the rent roll?
The rent roll is prepared by the seller and carries no weight against the tenant. The estoppel is the tenant's own confirmation, which is what you are relying on after closing.
What is a right of first refusal and why does it matter?
It lets a tenant match your purchase contract and buy the property instead. In an exchange that can remove your replacement property after the identification window has closed.
How long do estoppels take?
Commonly several weeks for a multi-tenant property, since tenants have little incentive to hurry. Request them the day you go under contract.
What if a tenant refuses to sign?
Treat it as a red flag and ask why. It frequently signals an unresolved dispute or a side agreement the seller has not mentioned.
Disclosure: Numerical example is for illustration purposes only; individual circumstances will vary.