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LoriM15 (Florida)
Posts: 1,009
Posted:
We use a large property management company for our large HOA. We have a full-time on site property manager and a full-time on-site admin, plus a 30 hour per week maintenance person.

Our contract was up for renewal in March and they are just now supposedly getting us the updated contract. The contract automatically went up 4% on the yearly anniversary. I heard (haven't seen in writing) that they are going to ask for an 11% increase in management fees.

We also pay a 25% markup on the office employees and a 35% markup on the maintenance employee.

We don't want to change management companies, but after our two employees left recently (the PM left voluntarily, the admin was fired because of her behavior) we started looking at the office and realized that the office staff was doing the bare minimum to keep the office running. The files are a mess, contracts not updated, projects not managed well, etc. Essentially, we have been paying a lot of money and not getting what we are paying for.

The new PM quietly told me that we should negotiate the employee markup. I'm just wondering if anyone has been able to successfully negotiate these markups. Currently our property manager is making $85,000, the admin is making $23 per hour and the maintenance guy is making $15 per hour. I was not on the board when they negotiated the last contract so I don't know if anyone even questioned these numbers.

Thanks for your input.
MaxB4
Posts: 3,513
Posted:
Something to consider is not hiring a GM from a management company, but hiring the GM as an employee as well as the admin and maintenance person.
KerryL1 (California)
Posts: 14,550
Posted:
Sorry that I must ask: What is "markup" in this usage?
MaxB4
Posts: 3,513
Posted:
The markup will be for benefits and insurance, so the office staff gets paid $23 an hours the HOA pays the management company 28.75. The maintenance guys gets $15 and hours and HOA pays $20.25.

From experience, you retain a better quality employee by making them part of the family. And it will cost you less money.
KerryL1 (California)
Posts: 14,550
Posted:
Our HOA pays about 35% "markup" for our Vendors' employees, e.g., F-T onsite manager & mgr. asst., custodians, security officers, chief & asst. engineer. The lone high rise HOA like ours nearby among a couple dozen had an F-T onsite in-house mgr., asst mgr., building engineer as employees for many years. He just retired and the twin towers shifted to a MC for not much more (I hear) than their direct employee.

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