utilities billing question from lease (and do you manage to make money off this?)

utilities billing question from lease (and do you manage to make money off this?)

Investor · Houston, TX · Member since 2018 · 25 posts · 5 votes

Hi - I have a strip center property where the lease says that if I manage the utilities, I can add a percentage to the bill as a management fee.

I'm wondering:

1. Is this common?  Do you have something similar in your own leases (whether you are a landlord or tenant)?

2. How do landlords use this clause?  Like my tenants are just directly billed by the utilities available here (water, electricity, gas).  What is the value-add I'd really be providing to justify a fee?

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  • Member since 2022 · 4 posts · 0 votes
    3y

    Yes, have seen management fee pass through on retail tenant leases. But generally it is on Common area management.

  • Ronald RohdePro Member
    Attorney · Dallas, TX · Member since 2016 · 5k+ posts · 2k+ votes
    3y

    Yes this is common. If you bill $100, you charge $103 to the tenants. If you're not paying it, you don't add a fee.

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