I have provided a template for you below.
This Management Agreement (the “Agreement”) is entered into as of _______________________, 2011 between ____________________ and _________________, a _________________Corporation (“Manager”). Owner is lawfully in possession and control of _________________ detailed on attached Schedule A, [ Address] the “Property”).
Manager is engaged in the business of managing, renting, and maintaining rental properties
and Owner desires to have Manager manage the Property on Owner’s behalf. Accordingly, in consideration of the mutual covenants herein contained, the parties hereto agree as follows:
Section 1 Appointment and Authority of Manager
Owner hereby employs Manager, as an independent contractor
, and Manager hereby accepts such employment, to manage, operate, lease and maintain the Property in accordance with the provisions of this Agreement. Owner hereby vests Manager with such power and authority as is reasonably necessary to carry out all the terms of this Agreement. Except as provided in the Agreement, however, Manager shall have no authority to incur any liability on behalf of Owner or to bind Owner or the Property by any contract or obligation.
Section 2 Term
Unless sooner terminated as hereafter provided, Manager shall have the sole and exclusive right to undertake and perform all rental and management operations of the Property for a period of three years from the date of the Agreement. Owner, in its sole and absolute discretion, may by written notice to Manager, terminate this Agreement, such termination to be effective thirty (30) days after receipt of such notice.
Section 3 Management Duties
In carrying out Manager’s management function during the term of this Agreement, Manager shall do all of the following:
a. General: Manager shall manage the Property by performing the management duties placed upon the General Partner by the owner’s Limited Partnership Agreement.
b. Leasing: Manager shall use its efforts to obtain responsible tenants for all units in the Property and to enter into and renew leases at the best rental rates obtainable. Manager shall: (1) negotiate all leases, extensions, renewals, licenses or other agreements for the rental or use of space in the Property; (2) execute and deliver all leases and agreements with tenants, licenses and concessionaries; (3) engage the services of any outside rental broker for customary fees; (4) undertake and carry out a program of advertising for vacancies which may from time to time exist.
c. Management Personnel: Manager shall hire, pay and supervise all persons necessary for the proper maintenance
and operation of the Property. All reasonable salaries, wages and other compensation of personnel employed by Manager shall be deemed to be expenses of Manager which are to be reimbursed by Owner hereunder.
d. Collection of Rents: Manager shall promptly collect all rents and other income arising from the Property and shall deposit all such funds into an account designated as an operating account for the Property maintained by Owner. In the event a tenant of one of the Property fails to pay when due any rental or other sums required to be paid under such tenant’s lease, Manager shall take any and all appropriate legal steps to enforce payment of such delinquent rental or other sums (including bringing suit for collection in Owner’s name).
e. Maintenance and Repair:
1. Normal Maintenance and Repair: Manager shall (using Owner’s funds available therefore) take all appropriate steps to insure that the Property is maintained in an attractive and good state of repair. In this connection, Manager shall arrange for landscape services, painting and cleaning services, plumbing
, utility and repair services to the Property and shall purchase all supplies and equipment necessary for maintenance and operation. Manager shall promptly arrange for the handling of all reasonable requests and complaints of any tenants of the Property.
2. Expenditures: In the performance of its duties under this subsection, Manager shall not contract for any work involving expenditure in excess of One-Thousand Dollars ($1,000) unless said work is detailed in the annual budget approved in writing. Provided, however, that emergency repairs are necessary for the preservation of safety of the Property and for the safety of the tenants or other persons or required to avoid the suspension of any exposure to criminal liability, may be made by Manager without prior approval of the Owner. Owner shall be notified of such emergency expenditures within forty-eight (48) hours of such occurrence.
3. Destruction or Condemnation: In the event all of the Property is destroyed by fire or other calamity or action is commenced to condemn all of the Property, or in the event of a partial destruction or condemnation which will (in Owner’s opinion) make it difficult or uneconomical to continue leasing the Property, then this Agreement shall be deemed terminated with neither party having any further obligation to the other. In the event of a partial destruction or condemnation which will not make it difficult or uneconomical to continue leasing the Property, then Manager shall, as Owner’s agent, arrange for the repair and/or replacement of the Property to a condition at least equal to its condition prior to such fire or calamity.
f. Real Estate
Taxes: Owner shall be responsible for all real property
Ad Valorem Taxes, including challenges as to valuations.
g. Insurance: Owner will provide and pay for the insurance coverage respecting the Property.
Section 5 Expense Reimbursement: Owner shall reimburse Manager for all direct expenses of managing the Property. Direct expenses are defined to mean all expense incurred at the site of the Property, pursuant to this Agreement, including without limitation, the cost of personnel provided herein. It shall also include, but not be limited to, travel expense to and from the property, cost of production of computer generated reports, long distance calls and delivery service costs for transfer of documents.
Section 6 Manager’s Compensation: Management Fee: Owner shall pay Manager a Management Fee for services rendered in an amount equal to four percent (4%) of all amounts collected by Manager.
Section 7 Financial Management Services:
a. Operating Account: All funds collected by Manager shall be deposited in the operating account designated in section 3d. Such account shall be the property of Owner.
b. Operating Expenses: Manager will incur all the necessary and reasonable costs to operate the Property. Such costs to include, but not limited to, utility expenses, repairs and maintenance costs, office and maintenance personnel costs, and such other normal operating costs reflected in the typical monthly budget agreed upon between Manager and Owner. Manager will maintain sufficient documentation of all such incurred costs and will summarize monthly to Owner such costs in an operating statement to be maintained by Manager’s office personnel and accountant.