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05/23/2017

Wondering the industry standard and negotiability for middle tier 3rd party management?

Cape Fear Commercial LLC, Lindsey Hess

Wondering the industry standard and negotiability for middle tier 3rd party management? The company we are working with has proposed a fee of 6% of gross income with a minimum of $2,500 monthly. Is this on the high-end of the fee structure and will the companies ever negotiate on the rates? Our facility is brand new and roughly 65,000 SF.

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3 Comments

Kevin Leebrick on Wednesday 05/24/2017 at 10:12AM wrote:

There is some negotiation in most contracts. Depending on where the management company is based and how often they are at your door that might no be a bad price. My suggestion is that you shop around and see what other companies charge.
With out stepping on toes, our management company has a minimum charge $1800 or 5% which ever is greater and includes at least 3 visits a month. It scales from depending on expected visits per month etc.

Lynn Sykes on Thursday 05/25/2017 at 04:25PM wrote:

You should vet out several Self Storage Management Companies before making any decisions. All have similarities and many differences. The management company should vet our the Self Storage Owner as well. Each should know the others expectations. I cannot emphasize strongly enough how important this is. The fee structure you mention is typical - usually the minimum is negotiable.

Kevin Leebrick on Thursday 05/25/2017 at 04:34PM wrote:

Lynn is 100% correct, (She also operates what many would consider one of the top/best middle tier 3rd party management company on the east coast, maybe the best) No plug there but SAM had a great reputation. Give her a call.

Disclaimer: The opinions expressed in the comments shown above are those of the individual comment authors and do not reflect the opinions of this organization.