Property Management Fees on A/B Class Assets

[Andrew Schena]

I'm currently looking at a 105 unit deal, which is comprised of 2 different assets.  One of the assets is Class A, and built 5 years ago.  The other property is a 70's product that just got repositioned to a Class B product 2 years ago.  The current owner is operating the properties without an actual "Management Fee", and simply pays a higher R&M expense, and simply pays the salaries of the employees in the Payroll Expense, across both properties.  The Payroll expense equals 6%, which is exactly what the Management Fee would be for this asset.  R&M expense is higher than average for these assets because of this as well, but it does save on paying the combination of Payroll + Management Fee + R&M.  

So, here are my questions:  Does anyone out there own any Class A/B that has seen this set up?  It would allow me to pay a higher price for the assets, and be more competitive, but am I being penny wise and pound foolish?  These would be 7-10 year holds, so in that time frame, as the assets age, am I going to start being better off running the assets traditionally as the R&M expenses begin to increase over time?  

I appreciate any feedback!  Thanks everyone.