Quote from @Engelo Rumora:
G'Day everyone,
The team (@Dominique Osborn, @Sean Mahoney) and myself have an opportunity to on-board 189 units.
This would be a very nice "chunk" of new business but to be honest, I'm inclined to pass.
I have always believed in doing business on your terms and for terms not to be dictated by someone else.
Especially when you are looking to hire us/me to do the work for you.
Also, business done right needs to be a win/win for all involved and this doesn't seem like a win for us.
I do however understand the caution and reluctancy to "let go of the reigns" per se as many landlords get screwed by property managers.
But at the end of the day, you have to "let go" and let someone else do it or just do it all yourself.
I'd love your advice on the suggested terms given to us below:
1) In AppFolio they want admin level access to their account.
2) They want a standardized list for maintenance items so they know in advance what repairs would cost.
3) They want a copy of all invoices from contractors to us so they can verify we are not marking up more than promised.
4) They want to be able to talk to our contractors before work is done (each time) so they can talk contractors down in price themselves.
5) They mentioned that they pay around $300 for full paint in a 2-bedroom unit.... we do not have a contractor that will touch a full paint on a 2 bedroom for $300
6) They want tiered PM Fees based on occupancy.... for example (their example): at 90% they would pay 8% PM fees, at 70% occupancy they would pay 2% PM Fees, and at 50% occupancy we would part ways.
The deal breaker in my opinion is points 4, 5 and 6.
With the lack of oversight/control on maintenance we have little control over the occupancy and it kills our process and efficiency.
So in a way, we are destined to fail from day 1.
Also, if someone does want so much control why not just self manage.
The unit count justifies hiring 1-2 full time people to run it.
Otherwise, let us do our job.
@Drew Sygit and @Jay Hinrichs I'd appreciate your professional opinion.
@James Wise I already know your answer but want to hear your unprofessional opinion so I feel better about my own thought process haha
Thanks everyone
Engelo my PM Brokerage is not in my name tag here but last checked we are #2 SFR PMc in U.S.A.. Dozens of branch/market offices throughout US of which I am out of national HQ. We have a client right now that I can not name, but if lookup the top 5 organizations in residential housing, there on that list, an absolute TITAN, and no we do NOT do anything like this even for them.... Nor anybody, this list is not viable nor realistic.
1) In AppFolio they want admin level access to their account.
NO, full-stop. Nobody and I mean NOBODY get's admin access into any of our systems. If Jesus came back and got into rentals NO, N-O-B-O-D-Y get's admin access into our system.
2) They want a standardized list for maintenance items so they know in advance what repairs would cost.
Being a PMc I'd invite them to acquire any of the readily available construction estimating tools/software out there such as RSMeans, but would not take on such a task as building and maintaining such a database, honestly for any $, it's simply not what we do.
3) They want a copy of all invoices from contractors to us so they can verify we are not marking up more than promised.
A-ok.
4) They want to be able to talk to our contractors before work is done (each time) so they can talk contractors down in price themselves.
I'd be fine with this as long as they sign a waiver that they own any/all negative impacts that result from such including extended vacancy periods, vendor refusals of service necessitating there own self-search to secure amicable vendor etc etc..
5) They mentioned that they pay around $300 for full paint in a 2-bedroom unit.... we do not have a contractor that will touch a full paint on a 2 bedroom for $300
LMAO! And what corner of the Ozark's is this in? In most markets that's closer to "A" room paint with trip charges. Again, happy to coordinate with YOUR contractors for services but no, no assurance of any price because we are a PMc not a remodeling firm nor a painting contractor, right.
6) They want tiered PM Fees based on occupancy.... for example (their example): at 90% they would pay 8% PM fees, at 70% occupancy they would pay 2% PM Fees, and at 50% occupancy we would part ways.
Sure, I'd be happy to do this WITH an addendum that for any vacancy do to there actions or inactions those units be accounted as leased for calculations.
To be honest Engelo if I had anyone reach out with this I'd laugh at them, literally. This is so abusive and extortionist in nature, and so disconnected from any sense of reality I'd really have to question the general intelligence of the persons presenting such.
Some make think my statement arrogant but it's experienced, and I think you get me Engelo. Anyone who's been in this business for a time, they know how crazy some of these requests are. Come on, admin access, really! How many laws does that violate for starters on assorted privacy.
If they wanted there own separate stand alone appfolio, so it's segregated data to them, ok solved data privacy but why not internalize PM's than?
The whole thing wreaks to high hell in my opinion. Either it's a setup for failure, and they know it, so no go. OR it's a setup for failure and there too clueless to know which is arguably even worse because every little everything your going to be dealing with morons every step of the way, arrogant ignorant's....
If anything I'd offer them a limited service offering. Offer to do TP's for there own self-managing but all that they want, no way, it's crazy.
Let the start-up PM's who get all in aww over a portfolio run themself bankrupt trying to service Mein Fueler, because you know that's what's going to happen.
