Expert: Mike Fortunato - 6/29/2007

Question
Hi Mike:  This is a great resource.

My non-profit corp has been offered an opportunity to manage some
property in the midwest that is about 50% vacant.  It consists of a strip of
buildings (about 40,000 sq ft.) on a busy street with angle parking out front.  
The owners want us to do everthing from common area maintenance, to
collecting rent, to leasing and tenant issues.  I need to respond with a fee
structure.  Any thoughts or resources?  Thanks.

Answer
First, you should know that most states require a real estate broker's license to manage properties for others, so you might want to check on that first if you don't have the proper license already.

Management fees vary widely depending on the region, and the complexity of the property. In general terms out here in southern California, the rates range from 3 to 5% of the gross rents, usually subject to a minimum (so that you aren't managing the property for free in the event the building goes vacant).

Mike F.