34% of my appraisal files this year had at least one retail tenant paying rent below a lease that technically expired

Ran into this exact thing on a six-unit strip in Lakewood, Ohio, closed late 2022. Rent roll showed $114,400 annualized, all current, broker called it stabilized. Three of those tenants were month-to-month holdover, one of them a nail salon that had been there eleven years with no renewal conversation ever happening. Priced at a 7.2 cap on that income like it had a weighted average lease term. It did not.

The thing I have never seen work is relying on the estoppel to catch this. Tenants sign what they are handed, they do not flag their own holdover status, and half the time the estoppel is drafted off the original lease anyway so the expiration date just carries forward unchallenged. What actually surfaces it is pulling the original lease, the first amendment if there is one, and doing the date math yourself against rent commencement, not against what the rent roll says the term is. That gap is where the exposure lives. In that Lakewood deal we renegotiated two leases before close and the seller ate a price reduction on the third because the salon was not signing anything longer than six months. The cap rate that got us to the table was not the cap rate we closed on.

What's your plan when a holdover tenant gets notice and just... Doesn't leave?