Page 242 - Trump University Commercial Real Estate 101

TRUMP UNIVERSITY COMMERCIAL REAL ESTATE 101

“ Will you allow me to be a signor on the operating account? ”
You might word it as a request, but it ’ s really a demand. You must
be a signor on the operating account. That will give you the ability to
get to your funds whenever you feel the need.
If your management company is not performing and you fi nd the
need to replace them, you don ’ t want your operating account held
hostage. They can ’ t legally do this, of course, but they defi nitely can
slow things down, claim that they never received a letter, throw up
some legal technicality, and employ other techniques to make your life
miserable. In the meantime, your property will need money to cover
operations. That money must now come out of your pocket.
Instead, you must have the ability to remove the funds quickly and open
a new account to which the management company will not have access.
Here is the objection you may hear from the management com-
pany: “ We don ’ t allow such access because we ’ ve had owners take all
the money out of the account at the time of resale. We then were left
with final utility bills and vendor bills that were not paid. ”

You can solve this dilemma in one of two ways: If you really want
to work with this company for some reason, offer to open a reserve
account and deposit an amount they ’ ll be satisfied with to cover short-

falls at closing. The other option is what I usually recommend: Scratch
that company off your list of fi nalists.
“ Do you require that I list the property with you at resale? ”
Some management companies will put in their contract that you
must give them the listing for the property they manage for you when
it ’ s time to sell. Otherwise, they require that you pay them a commis-
sion at the time of resale, even if you sell it through another broker. In
other words, you will pay a double commission.
At the very least, take this absurd requirement out of the contract.
Better yet, dump the company: After all, they are a management com-
pany, not a brokerage outfi t. It ’ s okay to let your manager know that at
the time of resale, you will make a decision. If things have worked out
extremely well, they ’ ll naturally be a serious contender for the listing.

They first must perform.

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