As a commercial real estate owner in Oklahoma, one of the most important things you can do is speak with an experienced attorney who can help make sure you are protected if a property manager fails to perform a job. There should be a crystal clear understanding by both parties as to what each are responsible for, and all of these agreements should be in writing.
An effective property management contract should contain several things. First, it should contain liability verbage, or in other words, a “hold harmless” clause. This prevents liability of the landlord for any third party vendors hired by a property manager. Second, it should contain a list of the services and fees of the property manager, as well as responsibilities of the property owner. These should be set out individually including specific inclusions and exclusions. Third, it must contain an Equal Opportunity Housing clause as required by law. Finally, fourth, it should contain contract duration and termination clauses. These items help to insure that all bases are covered for both parties.
An attorney who is experienced in drafting commercial property management contracts can make sure that all bases are covered, and no party may find themselves in a situation for which they are not covered. Even if a property owner drafts a management contract on their own, it is always helpful to have an attorney review it prior to signing. He or she may also be able to offer suggestions in securing the most comprehensive insurance policy.
A diligent commercial property owner should always make sure that a property manager is trustworthy and knowledgeable in handling any situation which may arise. Even so, there are times when situations arise which could not have been foreseen or prevented. It is during those times that a solid property management contract will matter most.
Source: The Balance, “6 Basics of a Good Property Management Contract,” Erin Eberlin, November 29, 2017