What should I check in a property maintenance company’s service contracts before buying?

A property maintenance company often earns its keep through agreements with property managers, condo boards and commercial landlords. Those agreements matter alongside the trucks and tools. Gather all of them, not a sample, and read them with your lawyer before you rely on the revenue they appear to promise.

Term, renewal and ending the agreement

Note how long each agreement runs, whether it renews by itself and how much notice either side must give to end it. Ask whether either party can end an agreement quickly, because that affects how settled the client list is. List the dates on one sheet so the pattern is easy to see.

Consent to a new owner

Some agreements need the client’s approval if the business changes hands, and some are with the owner personally. Ask your lawyer which apply here and how consent would be sought. Raise the timing with the seller early, because clients may need time to respond, and some will use the moment to ask for new terms.

Response times, concentration and relationships

Check the response times promised and whether the crew can meet them. Then count how much of the work comes from a few managers, since losing one could change the business a great deal. Finally, ask who deals with each client day to day. If the answer is always the owner, plan the handover with that in mind. The checklist of contracts to review when buying a hotel shows a similar approach in another trade.