PM signed awful snow contract

Investor · Chicago, IL · Member since 2020 · 26 posts · 17 votes

Hey all, I want to ask if you would sign this contract.

PM has a snow vendor who comes out to shovel if it snows more than 2". They charge us $250 per "push". Since we have 2 buildings (right next to each) the total is $500. So far this winter they've been "deployed" 3 times. Is this a fair price for snow removal? They don't cover parking spaces. Also, if you're familiar with Chicago, it's your standard 6-unit building, so imagine the sidewalk surrounding it.

As if you needed more reason, the PM doesn't even verify they do the work. They just pay the invoices. We have had tenants shoveling snow the snow all along.

What are some of your thoughts?

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Stuart UdisPro Member

Attorney · Philadelphia · Member since 2018 · 2k+ posts · 3k+ votes

@Jordan Laney Asking what others pay for snow removal and comparing your yearly spend to past years is not productive. Weather differs depending on where properties are located and even snow accumulation within the same geographic area will vary year to year. Slip and falls are a leading liability concern a property owner should be aware of and snow removal is not something to cheap out on.

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Dan Baldini
Property Manager · Indianapolis, IN · Member since 2016 · 16 posts · 16 votes
1y
Jordan—that appears to be quite a normal snow contract. Our PM company signs various ones for both our residential and commercial landlords with similar language and base pricing. It’s a balancing act of controlling costs while also controlling risk of personal injury to your tenants and property visitors as well as maintaining goodwill with all involved at the properties.
Of course, if the snow is not getting shoveled, that’s not good and needs compliance correction activities by the PM. But also remember to take reports by tenants of snow not getting shoveled with a huge deer lick of salt—the crew may have just finished and snow can and does accumulate rapidly in between trips.
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Peter MckernanBusiness Member
Residential Real Estate Agent · Irvine, CA · Member since 2013 · 2k+ posts · 1k+ votes
1y
I would call a couple snow removal businesses in the area and see what they would charge for that.. If it is indeed less on the other estimates present it to the PM, if they are the same price then you know the PM probably did the same digging to find the right company for the job.
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Chris SeveneyBusiness Member
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Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes
1y
Quote from @Jordan Laney:

Hey all, I want to ask if you would sign this contract.
PM has a snow vendor who comes out to shovel if it snows more than 2". They charge us $250 per "push". Since we have 2 buildings (right next to each) the total is $500. So far this winter they've been "deployed" 3 times. Is this a fair price for snow removal? They don't cover parking spaces. Also, if you're familiar with Chicago, it's your standard 6-unit building, so imagine the sidewalk surrounding it.
As if you needed more reason, the PM doesn't even verify they do the work. They just pay the invoices. We have had tenants shoveling snow the snow all along.
What are some of your thoughts?

That seems standard from what I am used too
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Jordan LaneyPro Member
OP
Investor · Chicago, IL · Member since 2020 · 26 posts · 17 votes
1y
So, what do you all pay for the entire season? Last we paid $300, FOR THE ENTIRE SEASON!
With another snowfall in the forecast, we are already at $1500.
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Matthew Paul
Severna Park, MD · Member since 2013 · 7k+ posts · 7k+ votes
1y
@Jordan LaneyI have been plowing since the early 1980s . And its always been a 2 inch trigger to start , we start at 2 inches and continue thru out the storm . You may be serviced 3 times during the storm and a final clean up and salting after the storm . So your $250 per push on a 10 inch snow storm could easily be $2000 for both buildings . With thawing and refreezing retreating it will be more .
Commercial buildings use triple net , and those costs get passed on to the tenants thru CAM fees . And the tenants always complain the lots not being done fast enough , then they complain of the costs .
Snow removal will always cost $$$
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Bill B.
Investor · Las Vegas, NV · Member since 2013 · 8k+ posts · 10k+ votes
1y
I assume it’s not high enough that you or any family members want to take on the job? Are there any similar surrounding buildings? Can you reach out to their owners and see what they’re doing? Next time it snows drive around looking for snow removal teams and reach out to them for pricing?
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Stuart UdisPro Member
Attorney · Philadelphia · Member since 2018 · 2k+ posts · 3k+ votes
1y
@Jordan Laney Asking what others pay for snow removal and comparing your yearly spend to past years is not productive. Weather differs depending on where properties are located and even snow accumulation within the same geographic area will vary year to year. Slip and falls are a leading liability concern a property owner should be aware of and snow removal is not something to cheap out on.
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Jonathan KlemmBusiness Member
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Contractor · Chicago, IL · Member since 2016 · 4k+ posts · 2k+ votes
1y
Hey Hey @Jordan Laney! What neighborhood of Chicago and how large are the buildings?
Off the cuff, $250 a push seems quite high and I'd look to find someone else if I were you.
For my 2 unit in Logan Square...I pay $70 per push and they come out for anything over 2". They only do the front sidewalk, front porch, and both gangways...
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Alecia LovelessPro Member
Member since 2019 · 3k+ posts · 2k+ votes
1y
@Jordan Laney I was paying $60 per plow plus $90 per salt. My plow guy was sometimes doing both 3-4 times per storm. Last two years I averaged $4300 for the season. This was for a 50’ driveway and 4 parking spots.
This year I contacted him and said no more salt. I have a different option to get sanded IF the driveway becomes icy.
In November the bill was $180 and in December $300. Based on the storms we have had those two months I have already saved over $1300 in salting fees.
You may not be able to break the contract this year but would recommend getting additional estimates going forward if you feel it is expensive.
My building is in a small community and unfortunately the other plow guys I contacted for bids would not agree to take the account away from their peer. They all knew who I used to plow. It may not be so easy to just replace the company you have.
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Nathan GesnerBusiness Member
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Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes
1y
No, that does not seem normal. They are only clearing sidewalks, not parking lots.
At $50 an hour, that's five hours of shoveling. At $100 an hour, it's 2.5 hours. There's no way it takes that long to shovel the sidewalk on a building of that size.
Shop around and I'm sure you'll find someone that does it for much cheaper.
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Matthew Paul
Severna Park, MD · Member since 2013 · 7k+ posts · 7k+ votes
1y
Quote from @Nathan Gesner:

No, that does not seem normal. They are only clearing sidewalks, not parking lots.
At $50 an hour, that's five hours of shoveling. At $100 an hour, it's 2.5 hours. There's no way it takes that long to shovel the sidewalk on a building of that size.
Shop around and I'm sure you'll find someone that does it for much cheaper.

Thats why we dont charge by hour for snow , its by the push , or by the inch .
Snow plowing is an emergency service , we are on call 24/7 for the entire winter , the prices you pay cover the salt that we stock , the prep for each storm , the desalting of the trucks , the overtime . Not just the plowing and salting itself . ( I keep 30 tons on hand before each storm )

We are sending trucks and men out in terrible conditions for long periods of time , at all hours of the day . To get things done as quick as possible , charging by the hour cost the contractor money , charging by the push/inch is the most profitable way to do snow .

@Alecia Loveless We plow AND salt , we dont give the customer an option . You have to plow and salt each storm to prepare for the next storm . We use SNOW plows and SNOW blowers , not ICE plows or ICE blowers .
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Nathan GesnerBusiness Member
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Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes
1y
Quote from @Matthew Paul:

I understand how businesses work. You can list all the reasons why you charge $250 for a one-time shoveling, but nobody will care when there are other vendors doing the exact same job for $100 or less.

I'm in a city of 10,000. I use one of the most expensive snow removal companies in town for a 16-plex that has 240 linear feet of sidewalk and 10,000 square feet of parking lot. They plow, shovel, salt and sand for $150 per.

OP should shop around.
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Matthew Paul
Severna Park, MD · Member since 2013 · 7k+ posts · 7k+ votes
1y
Quote from @Nathan Gesner:

Quote from @Matthew Paul:

I understand how businesses work. You can list all the reasons why you charge $250 for a one-time shoveling, but nobody will care when there are other vendors doing the exact same job for $100 or less.

I'm in a city of 10,000. I use one of the most expensive snow removal companies in town for a 16-plex that has 240 linear feet of sidewalk and 10,000 square feet of parking lot. They plow, shovel, salt and sand for $150 per.

OP should shop around.

The kids around here get $100 for a 2 car driveway . ( Maryland )
Small parking lot 12 cars plow and salt $450 . 2 in trigger
Costs are regional for sure
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John Warren
Real Estate Broker · 3412 S. Harlem Avenue Riverside, IL 60546 · Member since 2015 · 6k+ posts · 5k+ votes
1y
@Jordan Laney the devil is always in the details when you are hiring a PM company. Do they have actual vendor relationships? Do they do any of this in house? We do around 70% of our snow removal with our in-house maintenance team which means we pay probably 15-20% of that..... if it takes 30 minutes to salt then we charge for 30 minutes of time.
On the buildings that require plowing, we have a great vendor who charges far less than what you are paying. Definitely move on with this vendor. Teh PM also needs to be asked why they are not shopping for a better vendor.
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