Georgia PUD Quadplex with Restrictive Covenant requiring property management

2 Replies

I own a quadplex which is part of a planned unit development in Georgia. The development has a "declaration of rights, restrictions, easements, affirmative obligations, management agreement, and conditions" which seems to be intended to maintain the multifamily residential usage and branding for the complex. Most of the restrictions and conditions seem to make sense for this type of property. However, one restriction specifies that all building owners must employ a single property management company. 

Since this clause essentially forces owners to use this property management company, I've found the level of service and responsiveness from said company to be quite poor. The covenant allows for removal of the company but only if a majority of owners agree to terminate and employ another single management company. I feel the issue is that any company entering into this type of agreement will have little motivation to provide great service. 

The last management company was terminated a few years ago so I know that's possible. I'd like to either convince the other owners to terminate the agreement with the current management company, convince them to amend the agreement to remove this requirement, or potentially terminate the entire declaration considering it's nearly 30 years old and limits our ability to manage the properties ourselves. I talked with a lawyer but sounded like it would cost thousands to review and contest in court so would rather partner with other owners to get their buy in. 

Basically, I'm just posting this to get feedback, insight, and advice from anyone who has experienced a similar issue. I've not had to deal with HOAs, covenants, or restrictions like this so any advice would be great. 

I've not dealt with anything like this, but I wanted to ask some questions.  Have you met with the PM Company and provided your expectations to them?  I'm thinking if you get some sort of scorecard for performance created and bought into, then you'll be able to motivate (and potentially fire) the PM Company with greater ease.  

If you all have to use the same company, then why not spend some time and effort to get the most out of the PM company?

Thanks, Rick. 

I've tried several times to raise this with them. I even drafted a service level agreement for simple things like responsiveness to email and phone calls. No help though. 

The scorecard is a great idea. I'll start putting some more structure around the performance gaps and other issues I've seen. I also definitely plan to reach out to the other owners as well. 

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