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Management Rights

Management Rights. What are Management Rights?. Management rights involves: Ca retaking of common property Letting of property A person performing this role is known as: A Resident Unit Manager (RUM) Onsite manager / manager. What is the role of a manager?. Ca retaking:. mowing.

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Management Rights

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  1. Management Rights

  2. What are Management Rights? • Management rights involves: • Caretaking of common property • Letting of property • A person performing this role is known as: • A Resident Unit Manager (RUM) • Onsite manager / manager

  3. What is the role of a manager? • Caretaking: mowing cleaning the pool enforce bylaws

  4. What is the role of a manager? • Property letting: move tenants in collect rent for owners move tenants out

  5. What is the role of a manager? • Additional income can be generated: unit sales maintenance cleaning

  6. How income is generated? • Caretaking $90,000 • Letting of property $110,000 • Total income $200,000 • Expenses $10,000 • Nett income $190,000

  7. Valuation of Management Rights • Property $350,000 • Business (5 x $190,000) $950,000 • Total business worth $1,300,000

  8. Increasing business income • Caretaking $93,000 • Letting of property $112,000 • Additional income $10,000 • Total income $215,000 • Expenses $12,000 • Nett income $203,000

  9. Increasing business worth • Property $360,000 • Business (5 x $203,000) $1,015,000 • Total business worth $1,375,000 • Total business increase (1 year) $75,000

  10. Why choose Management Rights? • High return on investment (20%) • Stable income • Good cash flow • Low outgoings (ie no business rent) • No inventory / goods return • Lifestyle flexibility • Regulated

  11. Decision Factors when buying ? • Purchase power • Location • Age of complex • Years remaining in the agreement • Potential to increase business worth • Manager unit • What skills / tasks required • Trade off between factors

  12. Why choose Shine Realty? • Experienced agents • Professional network • Business lifecycle support • Buying management rights • Running management rights • Selling management rights

  13. Questions?

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