Rent Roll Purchase

Before I start … I will never buy another rent roll EVER!!!

I bought this VERY small rent roll of 12. No problems, right?

In order for me not to go into a full rant I will just state one of the many issues we experienced.

During the due diligence period it was conducted in his home office. He controlled the computer and showed me the management agreements (many of which were incomplete or missing)

Anyway, I posed the question ‘was there anything else I needed to know about the management of these properties that was not obvious?’ He respond with an astonished look on his face, like, what a dumb questions and then said No.

Handover was atrocious and he gave us a USB with over 3,000 documents on it.

Within these documents was an Annexure to the MA of ‘when the tenant vacates the management ends. The marketing for a new tenancy is put out to the open market and whoever gets the tenant gets the management’

I am still in the retention period. Can I reject these for failure to disclose?

I know this is brief but as I type this I am furious because it was such a sh*t show.

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Hi @Colleen In my early years that used to manage the ‘Investor Club’ properties. They were under the same format. The management agreement included a clause that stated when a property fell vacate it would be given to two other agents and the first to relet it would retain the management. I’ve never been on the buying end, but from the seller side, it was definitely buyer beware. I didn’t ever lose these managements as I always had them relet before the old tenant vacated, bi-passing the vacancy clause.

I’d seek legal advice on this as I’m not sure he had any obligation to disclose this. So, basically I had lots to say but very little advice to give. I’m sorry you had to go through this tho :frowning:

My beef is that I posed the question. He said No.

Surely this is failure to disclose.

At what point should he have disclosed there’s an agreement that renders these properties ‘casual’?

He burried the agreement in 3000 documents. The agent was shady af with so much more than just this.

I have my solicitor looking at it.

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