Most property management agents in the United States and Great Britain today are paying closer attention to itinerant tenants with no job record, pocketfuls of cash and a need to rent an apartment for only 30 to 90 days, brokers, managers and analysts tell GlobeSt.com in an exclusive industry survey.

Because of that scenario, "there is going to be a lot of housing discrimination against people of the Islam religion," Prof. F. Willis Caruso, director, Fair Housing Legal Center, John Marshall Law School, Chicago, tells GlobeSt.com Midwest Bureau Chief Mark Ruda. "The groups that are being discriminated against take awhile to learn how to exercise their rights."

"It's a hot topic that was part of the National Multi-Housing Association convention in Chicago last week," reports GlobeSt.com Southwest Bureau Chief Connie Gore.

"Everyone's looking at it," Mark Hayden, the association's Arizona executive director, tells Gore. "The challenge is you can't screen for things they (tenants) haven't done yet."

The topic heated up after a Delray Beach, FL property manager disclosed to the FBI that she had rented an apartment for 90 days, without credit or criminal background checks, to two of the 19 terrorists who killed themselves and 6,000 office employees in the destruction of the World Trade Center towers in New York and the Pentagon building in Washington, DC.

In GlobeSt.com's newest survey, sources tell this news service's bureau chiefs and reporters, on the record, that their tenant screening practices have not changed since the Sept. 11 tragedy.

Off the record, however, property managers concede they are honing their due diligence procedures like never before, staying within the letter of the law.

Although fair housing advocates in the United States and Great Britain have long argued that profiling or discrimination on race, sex, religion and age alone is illegal, property managers continue to defend their established practices of legally qualifying apartment, office, retail and industrial tenants on short-term or long-term leases.

For instance, flags should go up when an obviously foreign tenant prospect acknowledges being in the country for less than 90 days, David Carner, vice president, market development, RealPage Inc., Dallas, tells Gore.

"It's not illegal to turn someone down because they don't have proper papers," Carner says. "Law and order is something Americans are willing to give up some of their freedoms for."

In Orlando, 175 miles north of where the two terrorists rented an apartment in Delray Beach prior to the Sept. 11 attack, Tom D. Cook, senior associate, Carter & Associates-ONCOR, agrees.

"Whether right or wrong, how can you not profile?" Cook asks. "The FBI and police are doing it, and if the inconvenienced are not American citizens, is protecting our freedoms less important than preserving their rights as our guests?"

The broker says he thinks "it comes down to the fact that we are all being inconvenienced by the acts of a few when we fly or travel, when we congregate, etcetera and I'm okay with that."

But, he asks, "Why should housing applicants be any different than the traveling public?"

If screening policies by the country's property managers haven't changed since Sept. 11, they should, George D. Livingston, founder/president, Realvest Partners Inc., Maitland, FL tells GlobeSt.com.

"Profiling should have multiple components," suggests Livingston. "When it does, it's legal." Livingston is a former Defense Department analyst with numerous overseas assignments and a director of FIABCI, the international corporate real estate organization based in Paris.

The profiling should note obvious "foreign descent, short-term rental desired, no family, cash in large bills, little luggage and frequent visitors," he says. "I would have a policy of reporting early and often to the FBI or local police as the flags mount" on the prospective tenant's application.

Carrying large amounts of cash, however, shouldn't be a primary tipoff on a potentially dangerous tenant, points out Robin L. Webb, a longtime hotel property manager/operator and currently vice president/managing broker, Arvida Realty Services Commercial Division, Winter Park, FL.

"The typical red flags which go up in most markets because a prospective tenant asks for a short-term lease or pays in cash often do not apply" in Florida where property managers are accustomed to dealing with seasonal guests and a large number of corporate relocation tenants, Webb tells GlobeSt.com.

Further, says Webb, "many cultures around the world simply do not promote the use of credit cards and personal checks and therefore handle most transactions by cash."

Sam Cooper, the Arizona and New Mexico representative for UD Registry of Van Nuys, CA, says one good safeguard in screening foreign applicants is to ask for their visa and check its expiration date and the applicant's photo on the visa.

"If they're looking to rent for 12 months and the visa expired three months ago, you have a problem," Cooper tells GlobeSt.com's Gore. Passports are not acceptable because they lack expiration dates, she says.

New York property managers aren't taking new or special steps to spot potential terrorists, reports GlobeSt.com Northeast Bureau Chief Glen Thompson.

"I don't know of any difference," Gary Malin, CEO, Citi Habitats Inc., tells Thompson. "You just make sure they qualify."

Malin says he hasn't seen "any major shift in philosophy" among New York property managers. "Building owners are looking to protect themselves in the same way they always have," he says.

That appears to be the same approach property managers and owners are following in the Northwest, reports GlobeSt.com Northwest Bureau Chief Brian Miller.

Additionally, if a prospective tenant can't qualify after credit and employment investigations, a leasing co-signer can step up and try to qualify for the tenant, Bob Johnson, president, Marathon Management, Portland, OR, tells Miller.

"Because of those procedures, if a shady character does seek one of our units, they usually never follow up with us," Johnson says. "And if they are rejected once, it goes into the computer which prevents them from renting units at other Marathon-managed buildings."

In London, most leasing agents and property managers say their existing rigid tenant-qualifying procedures are sufficient to cope with suspicious prospects.

"Years of attacks by Irish terror groups made Londoners alive to the threat long before Sept. 11," reports GlobeSt.com's London Bureau Chief Graham Parker.

Still, paying rent and security deposits in cash rather than by check often raises a flag among property managers handling corporate tenant properties.

"If anyone wants to pay the rent and deposit in cash, we take them straight to the bank," Victoria Palau, manager, rental department, FPDSavill, tells GlobeSt.com London reporter Charlie Jacoby. "We used to get the occasional person paying by cash, but it is unusual nowadays. The last person who did has just been arrested for money laundering."

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BIG PICTURE: Profiling Short-Term Rental Tenants is Industry's Newest Hot Topic

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