A rent roll from a resort-market building rarely looks like one from a standard commercial asset, and reading a short-term-rental income statement with the same assumptions used for a long-term lease produces a distorted comparison. This review exists to normalize that gap before the number gets used to score a replacement candidate. Getting the normalization wrong at this stage tends to show up later as a financing surprise.
Rent Roll Contents Reviewed
The review starts with the raw document: unit or suite list, current rent, lease start and end dates, security deposit status, and any concessions granted. For a nightly-rental property, this expands to include booking platform revenue reports, occupancy by season, and average daily rate trends over at least a full year to capture the winter-to-summer swing typical of a Park City-area property.
Where a property mixes long-term leases with nightly units, as some Park City mixed-use buildings do, each income stream is reviewed on its own terms before being combined into a single figure, since blending them too early tends to hide which portion of the income is actually stable.
STR Revenue vs Long-Term Lease Income
Comparing a ski-season-heavy revenue stream against a stable twelve-month lease requires separating the two data sets before combining them into a single underwriting picture. The comparison package covers:
- peak-season versus off-season revenue split
- occupancy rate by month over the trailing period
- management fee and platform commission deductions
- reserve requirements for furnishings and turnover costs
This split is delivered as a simple table rather than buried in narrative, since the lender reviewing the file needs to see the seasonal swing at a glance.
Normalizing Seasonal Numbers
A single trailing-twelve figure can flatter or understate a resort property depending on which months it captures, so the normalization step annualizes revenue against a full seasonal cycle rather than the most recent twelve months in isolation. This matters most for candidates purchased mid-year, where a partial season can otherwise skew the comparison against the relinquished property's income.
A building sold coming out of a strong ski season can look considerably stronger than one sold coming out of a quiet shoulder season, even if their underlying annual performance is similar, which is exactly the kind of gap the normalization step is meant to close.
Flagging Rollover and Concession Risk
Lease rollover risk on a standard commercial candidate and booking-calendar risk on a nightly-rental candidate both get flagged the same way: as a line item in the analysis rather than a footnote. Concessions, whether a free month on a lease or a discounted platform rate during a shoulder season, are pulled out of the headline number so the underlying income is visible.
A seller's asking price built on an unadjusted headline number is one of the more common gaps this step catches before an offer is made, and it is worth raising directly with the seller's broker rather than discovering it after an offer has already been submitted.
Feeding Findings Into the Identification List
None of this analysis matters unless it reaches the identification decision in time, so findings are delivered as a short comparison memo rather than a raw spreadsheet, sized to be read quickly against the forty-five-day clock. That memo is what the investor and advisor use to decide whether a candidate stays on the list or gets replaced.
Where two candidates score closely, the memo lays out the specific tradeoff rather than a single ranking, since the investor's own income priorities should decide the tie.
A copy of the same memo goes to the lender when financing is involved, since a seasonal income pattern that reads as normal to a local reviewer can otherwise raise unnecessary questions during underwriting.
Common 1031 Exchange Questions
How is a short-term rental income statement different from a standard rent roll?
A nightly-rental property reports revenue through booking platforms with seasonal swings rather than fixed monthly lease payments, so occupancy and average daily rate over a full year matter more than a single month's figure. That data set is reviewed separately before being folded into the underwriting comparison.
Can a partial-year trailing figure be used to evaluate a candidate?
It can be used, but it should be annualized against a full seasonal cycle first, since a partial year captured mid-season can flatter or understate a resort property's true income. Normalizing for seasonality is part of the standard review, not an optional extra step.
What counts as a concession in this analysis?
Free rent months on a standard lease and discounted platform rates during a shoulder season both count as concessions, and both are pulled out of the headline revenue figure so the underlying, sustainable income is what gets compared across candidates.
How quickly is a rent roll analysis turned around?
Findings are delivered as a short comparison memo rather than a full spreadsheet dump, sized to be reviewed quickly against the forty-five-day identification deadline. Speed of delivery matters as much as depth once the clock is running.
Does rollover risk apply to short-term rental properties?
The equivalent risk is booking-calendar exposure rather than lease rollover, meaning reliance on repeat guests or a single booking platform, and it gets flagged the same way a lease expiration would on a standard commercial candidate. A property overly dependent on one platform is noted as a specific risk factor rather than folded into the general income figure.
