The professional property management industry is one of the most dynamic industries in the United States today and most of its revenue is generated through fees charged for its services. More often than not, when employing a professional property management firm, the property owners can expect to pay a premium for these fees, though they may be written off as valid business expenses against their annual tax liability in most cases by the owners. The property management fees charged are usually directly related to the services provided, and since this can vary dramatically, so too can the fees.

When hiring a professional property management company, the terms of the arrangement are usually worked out in advance, spelling out precisely what duties are expected of the property manager and in the process the specific fees are determined. Obviously if the property to be managed is a vacant field that simply needs to be visited once a month, the fees will be a lot less than if the property is a high rise apartment building with hundreds or tenants or a popular shopping center with multiple tenants and a wide array of management responsibilities. Therefore it is utterly impossible to provide an estimate of the relevant fees for any particular management job without knowing the specifics of what the job entails.

There are also a number of other factors that may affect the fees for any particular management job. For example, the geographical location of the property to be managed can make an enormous difference with respect to price. One would expect that the management fees for a twenty tenant apartment building in Manhattan would probably cost a lot more than the fees charged for managing a similar building in Oklahoma City. Likewise, managing a property in the heart of a major urban center is likely to cost more than managing one in a rural area, as there are usually more management related concerns in an urban area (tighter health and safety standards, security, and so on) than in rural ones.

The industry sector also plays an important role. For example, the management of an office building is almost always going to cost considerably more than the management of a self-storage facility simply because the responsibilities and duties are much greater. Further, there are very specialized niches – such as medical buildings, airports, and campus facilities – that usually cost considerably more since the manager has to have a great deal of specialized knowledge in order to perform his or her management duties properly. There is no clear cut increase or decrease in fee amounts based on whether or not the property is commercial or residential though, as the fees are based on the manager’s responsibilities, not the type of property being managed per se.

Finally, the fees are also based on the company employed. Like most competitive industries, there are some management companies that focus on lower fees in exchange for more limited services and others that adopt the opposite approach: full service for higher fees. Consequently it is usually in the best interests of property owners to shop around their local market and get basic quotes before committing to any one company as there is no uniform fee structure in the industry. This means that prices are negotiable and other factors – such as the duration of the contract – may have a direct bearing on the property management fees.