Commercial Property Management: Tenant Repair Requests

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When you think of the typical landlord-tenant relationship, customer service probably doesn’t come to mind but it is in fact a major component of every commercial landlord-tenant relationship. In such a setting, customer service entails keeping tenants happy so they continue their lease. There are many issues which can give rise to the need for customer service but the most common are repair/maintenance requests and rent collection.

Repair and maintenance requests made by tenants

Repair and maintenance issues are something property managers regularly face in the day-to-day operation of a commercial property. Next to rent collection, they are most common cause of conflict between property managers and tenants. Conflicts usually arise due to a misunderstanding about which party is responsible for making repairs. A well-drafted lease will include a repair/maintenance clause, so the best practice is to thoroughly review the clause with a tenant BEFORE they sign a lease. Knowing the rights and obligations of each party ahead of time will avoid confusion when a tenant inevitably makes a repair/maintenance request.


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The language used in repair/maintenance clauses varies greatly, but many specify common repairs such as those involving plumbing, lighting, roofing, and HVAC. In the rare case a repair or maintenance request is not covered in the lease, you must look to state law for guidance as to which party is responsible. In any case, there are two procedural steps that all property managers should take in order to ensure compliance with the lease and state law. They are as follows:


Step 1: Read the lease

When a tenant makes a repair/maintenance request, you must first read the lease paying close attention to any repair/maintenance clauses. If there is no repair clause, or if the repair clause doesn’t cover the repair in question, you must follow state law and individually negotiate with the tenant. This is discussed in more detail below.

Step 2: Let the tenant know who is responsible

After you have carefully read the lease, you should contact the tenant and let them know who is responsible for the repair.

  • If the lease says the tenant is responsible, you should give the tenant a copy of the applicable portion of the lease with an explanation why management is not responsible. This can be done via a certified letter, an email, or a hand-delivered letter.
  • If the lease says the landlord is responsible, you should provide the tenant with a copy of the applicable portion of the lease along with a guarantee that you will make the repair within the specified time frame. You must complete the repair within the time frame specified. This shows that management exercised due diligence to expedite the request and ensures that you will not be in breach. If the lease does not specify a time frame, the general rule is that the landlord has "a reasonable time" within which to make a repair. What constitutes "a reasonable time" varies by state so you will need to look to your state's laws for guidance. Once the repair has been scheduled, you should notify the tenant so they can prepare for the repair in advance if need be, and so they will know when to expect the repairs to be completed. Repairs often interfere with the normal course of business so notifying the tenant about the date and time of any repair is crucially important.
  • If the lease does not cover the repair, you will need to individually negotiate with the tenant AFTER you have carefully read your state’s laws. If the repair is costly, or if you are unsure how to proceed, you may consider consulting with an attorney. The best practice is to make any repairs which are not too costly. This helps establish a good repoire with the tenant by showing that management is flexible and has its tenants' best interests in mind. On the other hand, costly repairs are a little more complicated since you and the property owner will have to weigh the potential cost against the benefit to the landlord-tenant relationship.

Rent Collection

Part of your time as property manager will be spent collecting rent. Most leases require that the tenant pay a late fee ranging from $25-$100 for payments made past the due date. In such a case, management may either charge the late fee as per the lease OR forgive the late fee to establish better relations with the tenant. Sacrificing a minimal late fee is a small price to pay for establishing a good relationship with your tenants. In either case, management should send a letter to the tenant stating that their rent is past due and that they have been charged a late fee OR that the late fee has been forgiven. The letter should also specify when the landlord may move to evict the tenant for nonpayment according to both the lease and applicable state law.

Disclaimer

The information in this article is for general information purposes only. Nothing on this or associated pages, comments, answers, or other communications should be taken as legal advice. The information provided is not intended to create, and viewing of this information does not constitute, an attorney-client relationship.

© 2012 Bahin Ameri

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Comments 12 comments

rfmoran profile image

rfmoran 4 years ago from Long Island, New York

Solid advice here Bahin. As a lawyer and real estate investor I enjoyed these important reminders. Often I don't bother looking at the lease and will do a requested repair just to keep a tenant happy.


mackyi profile image

mackyi 4 years ago from Philadelphia

A very useful and informative hub. I totally agree with you all agreements should be in black and white. Tenants have the right to agree or disagree with all leasing agreements prior to moving in. This will help to avoid high tenant turnover and Landlord/Tenant legal battles.


Blawger profile image

Blawger 4 years ago from California Author

Yes, covering minor repairs is in my opinion the best (and cheapest) way to make tenants happy. Every business owner wants to save money so you can't go wrong. Plus, having things repaired without having to haggle or negotiate makes life easier for both parties. If only property owners saw it this way. I have worked with some owners who refused to pay for repairs they weren't required to pay for under the lease. It was extremely frustrating and it ultimately cost them a few tenants.


Larry Wall 4 years ago

I have never rented commercial property, but much of my life was spent in rented houses or apartments. Your rules should apply to them. I have had landlords rent me an apartment, and when I complained the next day something was not working, he blamed me and said it was fine. Luckily I was able to track down the previous tenant who said that the problem had existed for months, but they got tired of complaining about it. The correction was made, but my stay in that apartment was short.


Blawger profile image

Blawger 4 years ago from California Author

Larry, I experienced the same thing when I lived in Miami. My AC was not working properly and the management kept saying it was fine and that it "was just really hot in Miami". After two months they finally checked it and realized that I needed a new unit. Needless to say, I moved out shortly thereafter. Thank you for reading my hub and sharing your experience.


Blawger profile image

Blawger 4 years ago from California Author

Thank you for your kind words. You are right, leases should be straightforward. Most leases usually are, but sadly many people just gloss over their lease before signing without realizing that they have the right to negotiate certain terms.


TycoonSam profile image

TycoonSam 4 years ago from Washington, MI

Very Good advice. I own a handful of residential properties and when a tenant requests a repair I'm on top of it ASAP. I've always wanted to dabble in commercial properties but there are so many vacant in my area I'm not sure it it's the right time. Any advice?

Voted Useful and Thumbs Up


Blawger profile image

Blawger 4 years ago from California Author

Tycoon Sam, thank you for reading and leaving a comment. Let me preface by saying that I am not into risky investments. My motto in life is, "It's better to be safe than sorry". That being said, I would evaluate the profitability of each property individually considering factors such as the sale price, the number of vacancies, the monthly rental income, and the monthly operating costs. You may be able to negotiate a great sales price if a property has many vacancies, but the rental income may not be enough to cover the operating costs. I personally would not purchase a property operating in the red because I am not a big risk-taker. If you are willing to purchase a property that is temporarily unprofitable due to vacancies, you should, at the very least, negotiate a discounted sales price. Hope this helps!


TycoonSam profile image

TycoonSam 4 years ago from Washington, MI

Excellent advice! Thanks again.


thegoodlandlord 4 years ago from Indy

Good job! I have a couple of rentals and in my lease I explicitly state I am to repair the major items only (roof, plumbing, electrical and only if damaged through wear and tear) I stood up a website recently just to share the experiences I've developed from maintaining these properties as it's been a journey the last 6 years...and not all entirely a pleasant journey!


Blawger profile image

Blawger 4 years ago from California Author

thegoodlandlord-Thank you for reading and leaving a comment. Only covering major items is a smart choice. Major repairs are usually costly, so tenants will be pleased that they are not responsible. Plus, major items are usually interconnected with the other spaces so uniformity is crucial.


Ashley 19 months ago

I'm thinking about buying a condo, and renting it out. It's something that I would have to fix up first, but it would be worth it. Getting a property manager would be easier, but I want to try it on my own first. Thanks for all the great information! http://www.sandiegopropertymanagement.com/hoa-mana...

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