Hello, I wanted to know for people who have multiple properties: each property is separate entity, do you set up one overseeing management company? Are the employees at each property then employed by the one management company or do you keep payroll separate at the property level?
HiI own several properties and have set up one separate entity as a management company Every six month each property pays a “management fee” to this entity Besides paying for the manager that entity also pays for small items (like toilet seats, small replacement pipes and electrical outlets and switches etc)At the end of the year this entity has a very minimal profit Please talk to your accountant before you take advice from laypeople like meIsaac
We own 4 parks and have a management company approach to providing “services” All of our employees are in the management company except the on site managers, they are direct employees of the respective park. Each park pays a Management Services Fee each month and also an Administrative Services Fee each month. We out source all of our payroll work to ADP; and is that a huge benefit.All of our equipment, trucks, shovels, drills etc are owned by management co.This may sound like a lot of corporate overkill with just 4 parks, however, we have expectations of adopting the Frank and Dave role model and buy additions parks as available. We have the corporate structure in place. Synergy will take charge as we add parks and spread the cost of doing business over more entities.
We also have 4 parks and we are implementing something like kotr, although we have more of a crossover between “management co” and “homes co.” Homes (sales, rehabs, rentals) take the vast majority of management time and effort and we put this into a separate company so the “park co” has minimal activity. Starting a management co with all the equipment and salaries (even park manager?) might be our next step to reduce payroll and tax prep overhead. Tax prep especially.Brandon@Sandell
Any particular reason why equipment is held at mgmt llc? I assume you just want to split from park llc for liability?
Managing multiple parks via a separate legal entity (LLC, S Corp, Ltd Partnership, etc) is generally a good idea. You can handle payroll a little more streamlined or use a payroll company. Some payroll companies offer Workers Compensation insurance too, which is generally a decent deal for park owners. Otherwise, with one entity, you can lump them all undere one Workers Compensation insurance policy to get some economies of scale there.
Be sure to name your management entity as a Named Insured on the park’s insurance policy if you wholly own both. If the management entity also manages parks for third parties, consider adding Management Professional Liability insurance coveage, too. If there is separate underlying ownership of the management and park owning entities, I’d recommend insuring them separately.