Legal lease signed by manager? Owner wants to remain anonymous

[Garrett M.]

Hello BP friends! I need to write a legally binding lease for a single-family property I'm going to be managing for a friend who doesn't want to be named on the lease. I manage my own small portfolio of rentals and I offered a friend to manage their property. Normally my leases are very straightforward, so this is new territory for me. 

To protect myself from liability and also to ensure the lease is legally binding, I need advice on how to write out the lease. I've researched some and read that the owner can grant me the authority to act on their behalf in matters relating to the management of the property. But I can not find guidance on what needs to be disclosed on the lease itself.  Is there a specific lease format for this situation? 

I appreciate any guidance you have! I'm in Philadelphia, Pennsylvania if that has any bearing on the discussion. Thanks.

[Kevin M.]

It doesn't matter unfortunately. The act doesn't mention compensation, just that property management is a regulated activity. See link to a thread from the renowned @Chris K. with more details here;

https://www.biggerpockets.com/forums/12/topics/435226-pa---laws-surrounding-property-management

Also you should be aware that property management can be more involved than your friend probably realizes, and you are taking on a lot of risk and potential liability by managing property for your friend even as a favor. If someone slips and falls outside the property, or a pipe bursts and damages a tenant's expensive furniture, or a tenant's dog bites a mailman, or a tenant makes a claim for 2x his security deposit for alleged mishandling of funds- you could very well find your name listed at the top of a lawsuit. And your personal insurance might not be willing to step up if they decide you were engaging in a "business activity" without proper coverage. 

Maybe your chances of getting caught by the Real Estate Commission are slim to none, but management does come with some risk. 

If I were going to help a friend for free, I would tell him/her to execute the lease in his/her name and accept all rents/funds. You would certainly be allowed to help with handyman tasks and general upkeep without a license, but be careful about your personal exposure to liability!