Investment return and lifestyle are common motivations for taking on a Management Rights business.
A Management Rights business essentially requires you to take on the role of Caretaker with responsibility for some form of community living complex, and to operate a letting business (of units within the complex) on behalf of non-resident owners. Purchasing a Management Rights Business and effectively becoming a Resident Manager, is a business decision based on a number of factors including, investment return and lifestyle.
There are two types of Management Rights Agreements to consider:
1. Caretaking agreement
The requirement to care for and maintain the common property on behalf of the Body Corporate (i.e. pool, gardens, lawns, general cleanliness), in exchange for a salary.
2. Letting Agreement
An agreement with individual unit owners that allows the letting of units within the complex. Income is derived by way of an agreed letting commission. A Resident Letting Agent Licence is required.
The terms and subsequent income generated from each agreement will vary. Additional income can be sourced via the provision of maintenance, cleaning, linen, tour sales, equipment hire etc. as per your negotiated agreement terms. In some instances both caretaking and letting rights are covered in one contract by a single manager. In other cases, caretaking and letting are dealt with separately.
If you are considering the purchase of a Management Rights business and would like some guidance on current market trends or recent business case studies, we can help. Please give us a call on 07 3899 2866 or complete your details below and we’ll be in touch shortly.
Management Rights Finance Provider of Choice: