Hey BP peeps -
I own a 3-flat in Chicago. Live in one apartment, rent out the other two. I've had a lot of work done to this 100 year old building during the 7 years that I've owned it including work to fix gas related stuff like replacing old stuck pipe valves, etc.
My gas guy (independent contractor) has more than once suggested that I modify my gas meter setup, moving from 4 meters (one per unit plus one for common area gas to laundry and boiler) to just 1 meter. He says that, while a gas bill for the apartments usually comes in at about $25/month, the actual gas costs about $2 to $3. The rest of the bill is about fees and charges for, eg, meters. His logic: pay the $5 or $6 bucks that it costs to supply cooking gas to tenant units and remove that cost from them. Then I'd be able to advertise that the only utility tenants pay is electricity. He owns a couple of 2-flats in Chicago and did this in both. Said that this savings did make a difference to potential tenants.
My guy wants to charge me about $250 to do this modification, but a neighbor told me that the gas company will actually do this for free. I need to follow up with Peoples Gas to know that for sure. But first I'm wondering -
What do you all think about this? Would you pursue it? the $25/month does represent a $300/year savings to tenants which is a nice chunk. Also competition is getting stiffer and stiffer in Chicago. Nowadays it's not unusual to see things like free internet offered or even first month free. Anything reasonable a landlord can do to stick out is worth considering. Do you think this is worth $60 - $70 a year added to my expenses? And if I have to pay to have it done at a cost of $250 - worth it?
Look forward to your thoughts!
How are heat and hot water delivered to the apartments, @Lisa Brooks ? Are they only paying for cooking gas? If so, I'd '86 that altogether and just run the stove on electric. Why have the additional utility at all?
@Jaysen Medhurst - we have a really standard Chicago set up here. Heat is delivered via one boiler (heated with natural gas) that feeds steam to radiators throughout the building. And we have one large water tank that delivers hot water to apartments and laundry room. Two reasons for not 86-ing the cooking gas altogether: 1) I just put in two brand new gas stoves! and 2) the "certain kind of tenant" we cater to consider themselves chefs or at least sous chefs. I know.... But it's true. There is a pretty hard divide in our market between apartments with electric stoves and those with gas. We rent in gas territory. Tenants currently pay for cooking gas and electricity, and if they want 'em they pay for internet and cable. We do have rentals nearby that cover internet and some offer cable packages (eg., DirecTV).