At minimum, you need the current rent roll, tenancy documentation, trailing twelve-month operating statements, the last three years of tax returns for the property or owning entity, RSO registration documentation (for LA City pre-1978 buildings), the current property tax bill, the legal description of the property, the deed, title insurance from your acquisition, any active loan documents, and any permits or certificates for capital work. A clean package with these documents in order accelerates every stage of the transaction. Missing or inconsistent documentation is the single most common cause of re-trades and delayed closings in LA multifamily.
A current rent roll listing every unit by number, unit type, monthly rent, lease start date, lease expiration, security deposit amount, and any special provisions. Formatted consistently. Accurate to the dollar. The rent roll is the most-diligenced document in the transaction. Buyers reconcile it against bank deposits, operating statements, and tax return Schedule E. Discrepancies produce buyer discount or re-trades.
Original leases where available. Signed renewals and amendments. Any written communications regarding rent adjustments. Any tenant buyout agreements or pending buyouts. For long-held buildings, leases may be decades old and some may be missing. That is common. What matters is what exists, organized clearly, with gaps disclosed rather than hidden.
Trailing twelve-month (T-12) operating statements, ideally reconciled month-by-month. Three-year history if available. Detailed expense categorization. Buyers use these to verify NOI assumptions. Operating statements that reconcile to tax return Schedule E produce clean underwriting. Statements that diverge from tax returns produce buyer questions and often price reductions.
Three years of tax returns for the property or the owning entity. Schedule E (for individual ownership) or K-1 / partnership returns (for LLC or partnership ownership). This is the external verification document for the operating statements. Its consistency with the rent roll and operating statements is the strongest proof of rent roll accuracy.
Current RSO registration with LAHD. Annual registration payment history. Any RSO-related notices received. Any compliance notices or cure periods. Disclosure of any capital improvement pass-throughs filed and current. For RSO buildings, lapsed or disputed registration is a material buyer-side concern. Curing any gaps pre-listing saves pricing. For LA County RSTPO buildings, analogous documentation is required. For Culver City, Santa Monica, or other separate-city rent-controlled buildings, the applicable municipal compliance documentation.
Current annual property tax bill. History of any assessment appeals. Any active supplemental assessments.
Current deed. Legal description. Title insurance policy from the seller's acquisition (this is not transferable but provides baseline title history for buyer due diligence). Any easements, CC&Rs, or recorded restrictions.
Current loan documents. Payoff letter (during escrow). Prepayment provisions. Any lender consent requirements for the sale.
Building permits for capital work within the last ten years. Certificates of occupancy where applicable. Any outstanding unpermitted work disclosure. Unpermitted work surfaces in buyer inspection. Pre-listing disclosure is almost always better than post-discovery negotiation.
Current property insurance policy and claims history. Any active or recent claims.
Any environmental assessment reports (Phase I or Phase II) from the seller's acquisition. Any environmental incidents or remediation history. On older LA multifamily, lead-based paint and asbestos disclosures are often applicable. Pre-1978 inventory specifically requires lead disclosure.
Natural Hazard Disclosure Report (California requirement). Any applicable local point-of-sale requirements (earthquake retrofit, soft-story, etc.).
Gather the documents above in digital form, organized in clearly-labeled folders. Review each for accuracy and completeness. Identify gaps. Close the gaps where reasonable (obtain missing permits, reconcile statements to tax returns, update RSO registration, order required disclosures). A well-prepared document package signals to buyers that the seller is organized, the building is clean, and the transaction will close without drama. That signal alone often improves pricing by more than the preparation effort cost.
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Do I need an appraisal before selling?
Not typically. A broker's opinion of value based on recent closed comparables is the practical pricing tool for most LA multifamily sales.
How far back do I need tax returns?
Three years is standard for buyer diligence. More is better if available.
Can I sell without RSO registration documentation?
Not cleanly. Buyers of LA City pre-1978 inventory require RSO registration verification. Lapsed or disputed registration needs to be cured before or during escrow.
Michael Sterman is Senior Managing Director Investments at Marcus & Millichap.
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