A rent roll is a list of what tenants have agreed to pay. It is not income. Income is what the building collected, and NOI is what it kept. A signer who reads the first as the last is reading the top of a ladder as the bottom.
Updated 26 October 2026. A brief for principals, credit officers and committee members: the people who approve a number they did not build.
Key takeaways
- A rent roll says what is owed. The T-12 says what was collected and spent. NOI is what is left.
- On one 50-unit package we reviewed, the rent roll annualized to $848,772 of rent; T-12 NOI was $466,880; our lender NOI was $517,544.
- The same package's offering memo said $614,475 of in-place income: 32% above the T-12, with $69,986 of the gap in expense cuts the building had not shown.
- A small rent gap carries a large value: on a worked example, $124 a unit a month is about $2.78 million at a 6% cap rate.
- Five questions, asked before committee, find most of the gap.
Three documents, three different numbers
Every package carries three versions of what a building earns, and they answer different questions.
| Document | What it says | What it is not |
|---|---|---|
| Rent roll | What each tenant has agreed to pay, today | What was collected |
| T-12 | What was collected and spent over the last twelve months | What the building will earn |
| Offering memo | What the seller or broker says the building earns, or will | A figure anyone has to stand behind |
The rent roll is ahead of the T-12 when units were leased recently, and behind it when tenants are leaving. The memo is usually ahead of both. A memo that leads with the memo figure has asked the committee to start from the claim and work backward.
The ladder on one 50-unit package
The figures below come from one 50-unit loan package we reviewed; the building, city and tenants are withheld. The full teardown walks each line.
| Step | Figure | What it is |
|---|---|---|
| Rent roll, annualized | $848,772 | $70,731 of monthly rent on 48 occupied units, times twelve |
| T-12 net rental income | $774,170 | What the books show was collected, including lease-up early in the year |
| Offering memo, in-place NOI | $614,475 | The seller's figure |
| Titleman lender NOI | $517,544 | Run-rate income, 5.5% vacancy and credit loss, actual expenses plus reserves |
| T-12 NOI | $466,880 | What the building kept over twelve months |
On this package the rent roll and the T-12 agreed with each other: January rental income equaled the rent roll to the dollar, and units and occupancy matched. The disagreement was the memo. Its in-place figure was $147,595 above the T-12, of which $77,609 was income and $69,986 was expense cuts, including insurance underwritten at $60,907 against $98,583 actually paid. A rent roll that ties out is a good start. It says nothing about the expenses.
How a small rent gap becomes a large value
Rent gaps look small because they are quoted per unit and per month. Value is computed per year and divided by a cap rate. Two worked examples from our briefs, with stated cap rates:
- Average rent. The memo shows $1,840 a unit, the rent roll $1,716. $124 × 112 occupied units × 12 months is $166,656 a year; at a 6% cap rate, about $2.78 million of value. What a deal review catches works it through.
- Leased area. A suite on the roll at 4,200 square feet and $28.00 a foot carries rent of $117,600 a year; the lease says 3,900 square feet, which is rent of $109,200. The $8,400 a year the lease does not support is about $120,000 of value at a 7% cap rate. Rent roll vs leases lists six such mismatches.
The cap rates are assumptions, not market figures. The point is the multiplier: every dollar a month that is not real is roughly two hundred dollars of price.
Five questions a signer should ask
- Does the rent roll tie to the T-12? The latest month of rental income on the T-12 should equal the rent roll total, or the team should say why not.
- Which rents on the roll are not being paid? Tenants in arrears, on a payment plan or in free rent are on the roll and not in the income.
- Do the leases support the roll? Area, rent steps and expiry dates on the roll should match the lease, suite by suite, on the material tenants.
- Which expenses in the memo are lower than the T-12, and what supports each cut? Insurance, repairs and management fee are the usual ones. A cut with no quote or contract behind it is a claim.
- What NOI would we underwrite, and how far is it from the memo? One number, with the gap to the memo stated in dollars and percent.
Our investment committee memo standard puts the answer to question 5 on page one. How a lender checks a rent roll and T-12 covers the same checks from the credit side.
What an AI analyst does with the rent roll
Titleman reads the rent roll, the leases, the offering memo, the T-12 and the model together, ties every figure stated in more than one place and marks each one verified, to review or red flag, with the page or cell it came from. On the 50-unit package above, that read also sent five requests back to the borrower, starting with a bound insurance quote and the tax abatement certificate. The judgment on what NOI to carry stays with your credit team.
To see where your own rent roll and T-12 disagree, book a demo and send one package.
Updated 26 October 2026. Written by the Titleman team with AI assistance. The 50-unit figures come from one loan package reviewed by Titleman; its money figures are scaled by one constant factor to withhold the client, so ratios and ties are unchanged. Rent gap examples are worked examples with stated cap rates.
FAQ
What is the difference between a rent roll and income?
A rent roll lists each unit or suite, its tenant, its contracted rent and its lease dates. It says what is owed. Income is what was collected over a period, after vacancy, concessions and tenants who did not pay, and it is shown in the T-12. Net operating income then subtracts operating expenses.
Why do the rent roll and the T-12 disagree?
Usually for one of four reasons: units leased recently (the roll is ahead of the books), concessions or free rent the roll does not show, tenants who are on the roll but not paying, and rent steps or areas on the roll that the leases do not support. Each one is a question to the seller, not a rounding difference.
Which number should an investment committee rely on?
Start from the T-12 and the rent roll tied together, then test the broker's in-place figure against both. On the 50-unit package in this brief, the offering memo said $614,475 of in-place income, 32% above the T-12 NOI of $466,880.
How much value can a rent roll error carry?
More than it looks. On a worked example in our deal review brief, an average rent of $1,840 in the offering memo against $1,716 on the rent roll, across 112 occupied units, is $166,656 a year, or about $2.78 million of value at a 6% cap rate.
Can an AI analyst check a rent roll against the T-12?
Yes. Titleman reads the rent roll, the leases, the offering memo, the T-12 and the model together, ties the figures stated in more than one place, and marks each one verified, to review or red flag, with the page or cell it came from.