The Importance of Vetting Commercial Real Estate Tenants

The success of any commercial real estate investment company relies on having good tenants in the building. Vetting commercial real estate tenants helps to ensure that they have good credit, have not been evicted in the past, and will look after the property. Letting a bad tenant rent your commercial real estate space can be a costly mistake.

Essential checks to vet CRE tenants

What should you check out when looking for commercial tenants to rent your office or commercial space? You should run checks on the following:

  • Check credit records
  • Contact previous landlords to find out why the client moved
  • Review tax returns
  • Run background checks

The importance of vetting commercial real estate tenants by contacting previous landlords is essential. Sometimes, potential tenants can provide paperwork showing that everything is in order. However, when contacting the previous landlord, you may find out that they were evicted for non-payment of rent.

How to vet CRE tenants

Here are some of the important ways to vet a potential commercial real estate tenant.

Check finances

You need to get financial reports and credit reports to make sure that your potential tenant has solid financial backing. This will help to ensure that the tenant will be able to pay the rent for the length of the lease. It also helps to make sure that there is less risk of bankruptcy.

Check tenant’s history

Just as important as the making sure the tenant’s finances are in order is to check their business history. This has a number of aspects.

First, you need to make sure that they have the skills and business plan that give evidence they will be successful.

Second, you should inquire about their previous dealings with landlords. Even if the tenant has faced bankruptcy or eviction in the past, it’s important to find out the reasons why. Sometimes, difficulties could have been caused by an uncooperative landlord and not the tenant.


How well you get on with the tenant during the interview process can also give an indication if the tenant will be cooperative. As a landlord, you want your new tenant to become an asset to your investment, not a liability. Contacting previous landlords can be useful.

You should also consider if the tenant’s business will complement the other tenants already occupying commercial space in your property.