Property Management Service Level Agreement – Portfolio of Residential Properties
This Property Management Service Level Agreement – Portfolio of Residential Properties can be used by a Property Management Company that manages a portfolio of residential properties on behalf of the Owner. Other templates are available for the management of a single property, multi-let buildings, and commercial properties.
It is assumed that both the Management Company and the property Owner are acting in the course of a business. This document is not suitable for “business-to-consumer” transactions.
This Service Level Agreement sets out (in Schedule 1) a list of the properties for which the Management Company is to be responsible. This list can change over time as the Agreement is designed to be flexible and to form the basis of a long-term relationship between the parties. Each property is to be let on an assured shorthold tenancy basis and managed by the Management Company during the tenancy and during any void periods.
The Agreement sets out in detail the rights and obligations of each party. It includes clauses dealing with key issues such as insurance, liability and indemnity, financial record keeping, confidentiality and non-solicitation. There are also provisions for monitoring the Management Company’s performance and for reviewing and varying the contractual relationship between the parties. Penalty fees and termination rights may apply if the Management Company does not perform to the required standard.
This Agreement includes provisions relating to the mandatory requirements for property managers to be members of a Client Money Protection Scheme. This statement must be included if the Manager holds client money.
Clauses 6.9 and 6.10 are optional. These address the freedom of the parties to deal with third parties. You may wish to include one or both of these depending on the bias you wish the agreement to adopt. It should be understood that clause 6.9, whilst allowing the client to obtain similar services from a third party, should not harm the service provider’s interests under the agreement at hand as its provisions and binding effect upon the Client will remain unchanged. Clause 6.10 has the potential to limit the service provider’s freedom to deal with the client’s competitors. This should be used with care and the consent referred to in that clause should generally be given without hesitation, lest the restrictions in clause 6.10 be challenged on the grounds of restraint of trade. If you are the client and are considering withholding such consent, legal advice from a commercial law firm is strongly recommended.
The scope of the Management Company’s role is set out in Schedule 2. An example scope of work is included in the template but this should be reviewed carefully and amended as appropriate to suit the needs of the Management Company and to reflect the particular transaction.
Fees and payment are covered in Schedule 3. There can be a monthly fee, ad hoc payments or a combination of the two. Penalty payments can apply if the Management Company fails to meet the expected standards of service.
Schedule 4 contains a list of Service Levels – the standards to which the Management Company must perform the Services – and details of the Performance Monitoring that must be carried out. Example provisions are included but these should be amended to suit the Management Company’s working practices.
Schedule 5 contains the Owner’s obligations. The example wording should be reviewed and amended as necessary.
Optional phrases / clauses are enclosed in square brackets. These should be read carefully and selected so as to be compatible with one another. Unused options should be removed from the document.
This Property Management Service Level Agreement – Portfolio of Residential Properties contains the following clauses:
1. Definitions and Interpretation
2. Term of Agreement
3. Manager’s Obligations
4. Client’s Obligations
5. Fees, Payment and Records
6. Provision of the Services
7. Service and Agreement Monitoring
8. Performance Management and Monitoring
10. Intellectual Property Rights
13. Liability and Indemnity
14. Force Majeure
15. No Waiver
16. Further Assurance
19. Assignment and Sub-Contracting
21. Relationship of the Parties
23. Third Party Rights
25. Entire Agreement
28. Dispute Resolution
29. Law and Jurisdiction
And the following schedules:
1. List of Properties
2. Specification of Services
3. Fees, Payment and Penalty Fees
4. Service Levels, Performance Monitoring and Performance Reports
5. Client’s Obligations
This template is in open format. Either enter the requisite details in the highlighted fields or adjust the wording to suit your purposes.
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