Don’t change your management agreement for anyone. Leave all the language as it is, even when you want to cut a deal with an investor / negotiator / bank / large player. Use an addendum and attach it to the management agreement with whatever changes you want to make. There are strong protections in a well crafted PMA and you don’t want to tinker with the basic language. Here is the right document to make your changes to fees etc. It modifies the management agreement without carving it up. You don’t want another party crossing out important language in the original document because it’s hard to figure out what to leave, how it’s going to affect the whole agreement and erode important protections for you. Add this page, make specific changes and leave the basic document alone. This document will get the job done without diluting all the protection laid out in your property management agreement.
“The longer you’re in property management the more you realize that it’s sticky, often hostile, sometimes even litigious. Over 35 years I’ve been burned many times by owners, tenants, vendors, staff and third parties and after the second or third time (I’m a slow learner) I would go back to the attorney and have her draft a document that prevents it from ever happening again. Blaming property managers has reached an all-time high and isn’t going away anytime soon. So, understanding this reality, smart managers need to spend extra time, money and effort building/crafting documents designed to protect themselves, even from the folks they are trying to serve. We’ve pulled these documents from our archives and have listed them here for your review and downloading individually (or in packages by topic). We’ve laid this material out in the Property Management Life Cycle categories for purposes of giving the discussion some order.
Protecting yourself from Owners is what these documents are all about.
The Property Management Lifecycle by Crown Investor Institute LLC