Pay raises for Manager and Maintenance Man

Manager and Maintenace man have been working for the 50 space park now for one year.Can someone give me an idea how often you give pay raises to the above? if any at all?And what kind of raise is fair or adequate or appropriate?one thing we have said is if they stay for one year we will give them a one week paid vacation.What else??  more monthly income, how much more??appreciate some ideas here of what is being done in this around the countrythanksMike

I am no accountant, but I plan on incorporating quarterly bonuses based on performance. That way you are paying what you can afford, and they are directly compensated for  for working efficiently. I am curious how well this holds up once applied. I like the 1 week paid vacation.

On a 50 space park, we would typically pay $500 to $1,000 per month (based on how many park-owned homes you have and whether or not the manager can mow), plus free lot rent (or mobile home if necessary). We would not hire a maintenance man for a park that small, unless you have a huge number of park-owned homes and they are qualified to make repairs.We would never give any type of incentive or bonus program for a manager on a park this small unless you want to give them $250 for every home they sell/rent (which is what we do).What is the manager’s value add in this park?

My initial thoughts are to be very careful with raises.  I certainly wouldn’t schedule in an annual raise.  You don’t want to find yourself way overpaying a manager a few years down the road simply because he has been around a while.  Also, this is not good for the manager!  If you end up fireing them to hire in someone new/cheaper then you have not done him any favors.
Also a set annual wage increase/ Christmas bonus/whatever will quickly become an expectation and will be considered a sleight if it doesn’t come through on a bad year or if the manager simply isn’t living up to the same level of performance that you’ve come to expect.
If you’ve had a manager for a year and are happy with their performance it may not be a bad idea to give them a boost of income to prevent their eyes from wandering to much into other parks/careers. I also like the idea of a quarterly bonus based on performance-- this should ensure that your manager is continuing to strive for exellence rather than "punching the clock."
That’s my thought, but keep in mind that I own no parks nor pay any managers.

A 50 space park is not a full time job for a manager. They should have a real job and manage the park part-time. If you hire somebody who thinks this is their full time job, they will embezzle you to death.

We give annual bonuses in December (along with a Christmas card). Yes, they probably have come to expect it but some of our managers have been with us for almost 10 years so this is something we want to do for them for their loyalty and good work ethic.  The amount ranges from $300 to $1000 depending on size of park, time with us, how much we like them, etc. We seldom give raises -  only in cases where we increase occupancy.  When it comes time to sell the park, you can list the bonus as  a discretionary expense for the buyer, but with straight pay increases it is harder to do that.

Good point. Thanks for sharing.

We keep our manager pay steady but bump the bonus programs. I also provide some additional benefits in my manager agreements. Free rent, I pay for internet, I pay for phone, I pay for water / sewer / trash. In some markets we also give a utility credit, housing and a vehicle. I have found there is more benefit to the stuff provided that is not money- as it is a expense for me but the manager needs to make $100 to spend $70. Check with your CPA and attorney on how to structure this so your covered.  

Since most increase lot rents every year and I am assuming the manager is staying in the park, isn’t this actually an automatic raise for the manager? I also like giving a Christmas gift to the manager who have been doing well. 

i have some ideas but i was hoping those big boys with all the parks would reply if possible.  I usually give a bonus for Christmas and last Christmas i gave them a small bonus.  The manager makes extra pay every time she sells a vacant home of $250 but that is limited to number of homes for sale.  And when the maintenance guy does jobs that are not on the duties list like leveling a home, or roofing a house then he does a bid on the home just like any other contractor.  That way he gets paid for daily duties and can make extra for off duties list jobs; last couple of months he has done about 3 or 4 of these jobs that he bid and i think he is happy with that.Sebastian can u explain specifically how the quarterly bonuses will work?and can you explain what u pay your manager and maintenance and the size of your park?thanks

Sorry I should have said that I have no mobile home parks, so this is still theoretical for me. I am planning on buying one next year. I witness so much waste in office environments, that I plan on setting an operating budget, and encourage the manager to save by sharing a percentage of the savings(meaning they are operating well below the budget). Its all the little things that add up quickly. Of course the larger the park–>the larger the budget  = larger bonus.
If I make more than is anticipated(and the manager makes my job easier) then I will share in the profits. My thinking is that I can get maximum efficeincy and focus on acquiring the next venture.

We also give bonuses monthly to one manager that collects the highest percent of the collectible rent. We communicate with all of our managers through a forum, sort of like this one but with topics to separate out each park. One is a place everyone can see into- and there is some friendly banter each month as collections are talked about. In our turn around parks we have occupancy bonuses. I call them ‘milestones’ and they pay the manger between 1000 and 2500 for each one. There is one milestone for each 5% of occupancy. Our rehab managers also do rehabs, they are paid a bit differently than a regular manager. So they get $250 for each home sold, plus the milestones. A first year manager might receive 250 - 500 depending on the size and complexity of the park. A multi year manager might see between 500 and 1000, a birthday gift, maybe we will fly them someplace and give them a timeshare week for a vacation. I have also been known to pay for a nice phone, or a tablet if they want / need it. If I hit a local place they like to eat, I pick up a $50 gift card and give it to them as I am leaving. In Indiana they like Steak and Shake… The managers like the pay, but they really like the extras. Treat them well, and they will really care for your park. I like to tell them they do not work for me- they work with me. It is their property to run within the rules and regulations I set forth.  

HEY guys thanks for all the inputi have only one park and manager collected 100% of all space and lease option rent for september.  Scheduled $27,540 and she collected it all.  Would you consider a bonus for doing that?  how much?   Jim she was highest rent collection manager as i only have one lol.

That manager sounds like a keeper, mikes. Checking with accountant and lawyer always makes a ton of sense to me.

An annual review of salaries and compensation, without indicating that there is a COLA attached, makes more sense to me than an annual raise. Also, concerning the bonus issue, I used to work for a really big Sub S corp that had both quarterly and annual bonuses. Each quarter when the bonus letter was published, it was very clear in calling it a ‘discretionary profit sharing bonus’. So, one day I asked one of the staff accountants about it and he said something to the effect that, I don’t remember all of it, the bonus is it was based on booked profits but given solely at the discretion of management. Thus, it was not part of the compensation package but rather based on the company doing well and the executive management sharing part of the profits with staff. So, you might avoid some trouble by calling any bonuses discretionary. But check with an accountant to be sure.

Jim Allen

i’m thinking of giving the manager for almost 100% rent collection $50 for the month of September, what u think?in the past i’ve been way to giving as i was paying manager around $30,000 per year.  and giving big bonuses.  So I’m thinking of a number and then cutting it way down hahatake caremike

As owner-operators we keep all bonuses, Christmas incentives, gifts, and give ourselves paid time-off. My wife loves our nice office and great people and managing it out would be a disappointment since I use the location for other business enterprises and she spends time with her hobbies. Thus it is a win-win situation that we both love and deeply enjoy. Words cannot be expressed when a residents comes into our office and hugs us and says thank you for caring!!! We have cried with people in distress and had joy in their success–life is more than just MONEY. Look at our children they do not need things they need us and there is no reset bottom on our children. When we owned and operated multiple parks my head was expending the wrong way–yes lots of wealth but little quality family time and little for my Creator. Really just think you own multiple parks fly around visiting them and you want a person responsible for your investment on the cheap side–maybe cheaper than Wal-Mart–I cannot believe the logic. Sharing your wealth with those that have helped is a win-win situation and in the pass I have sold businesses to my employees and that was a thrill for all involved.

Focus on the value add of the manager. Some things the manager has no impact on, like when you raise the rent. Collections are not a big value add, as I assume you are using “no pay/no stay” so they are choosing to pay rent to keep a roof over their head, not to appease the manager. Renting or selling a home is a value add so $250 bonus is acceptable (but with certain conditions so they don’t “churn” homes).Where many owners go bad is to start bonus programs which are not based on actual work and, as a result, just create more demand for something for nothing. That’s where those $100,000 per year managers in parks we buy came from.