STR management. Lease or percentage of profits

[Curt Bixel]

I am curious if anyone has any input on how to structure a management contract for a STR. I think two of the options are to either have the management keep a certain share of the profits or to have the management sign a long term lease for the property, pay the monthly rent, and then keep any profits they earn above that monthly rent.

Setting the rent, in this case, would be a bit of a challenge, as a fair rent would find some sort of balance between the risk of a loss if the STR experiences low occupancy and the reward of making more profit should the occupancy be high.

I wonder if anyone who has wrestled with this decision might have some guidance.