Operations

LICENSES REQUIRED TO OPERATE

The following procedures will be done by Property Management prior to starting the

business in June 2011.

City of Springfield, MO

1. Property Management will obtain a license to operate in Springfield in April

2011. This will include business license, requests for zoning approval and fire

premise reports. Licensing Division is located on the first floor of the Busch

Municipal Building at 840 Boonville; office hours are from 8:00 a.m. to 5:00 p.m.

Monday through Friday. (Small Business Council of Springfield Area Chamber of

Commerce, p. 6)



County

Property Management will obtain a Greene County Business license to meet the County„s

requirement of running Property Management.

State of Missouri

1. Property Management will obtain a Missouri Tax Identification Number by going

on-line to: http://www.einonline.net/EIN_Apply_Online.html. Once the

application is completed, an EIN will be issued immediately.

2. Missouri Department of Revenue tax registration application (FORM 2643) will

be completed by April 2011 by going on-line to:

http://dor.mo.gov/forms/2643.pdf

3. Registering Property Management with the Division of Employment Security

(DES) will determinate if liable for Unemployment Insurance Tax; Registration

will be filled out in April 2011 by using the following website:

http://www.labor.mo.gov/DES/Employers/quickguide_employers.asp

4. Since Property Management has less than 4 employees; Worker Compensation

application is not necessary at this time. Whenever necessary, application can be

accessed at http://www.labor.mo.gov/.



Federal Government

The following Property Management is going to fill applications for:

1. Federal Employee Identification Number

2. Federal Income Tax Withholding

3. Social Security Tax Withholding

4. Federal Unemployment Tax

MANAGEMENT CONTROLS







Michael Wacker

President, General

Manager







Maintenance

Broker

Manager









Contractor Contractor Contractor Agent Agent









OPERATING STRATEGY/EXECUTION

The start-up capital will be formed as follows:

 Equity capital investments:

1. Initial Investment $300,000.00

 Loan:



Property Management will lease the office space available in the home of owner

Michael Wacker in Springfield Missouri. The physical address of the location will be:

Property Management



Springfield, Missouri



This office space is available until additional space is needed at a cost of $200.00

monthly. Property Management intends to operate year-round, regular office hours

Monday thru Friday from 9 am to 5 pm; however, services are available 24-7 365 days a

year.

In June 2011, Property Management will begin providing property management services to

property owners in the Springfield Missouri area as well as purchase investment properties with

the intent to refurbish and resale. An additional source of income will come from renting

investment properties until resold.

Property Management will launch a marketing campaign in the Springfield area to familiarize

realtors and property owners of the mission, vision, and services available.





PROPERTY MANAGEMENT SERVICES AVAILABLE



Market Analysis and Projections

A market analysis for each property using market comparables and other market research to

adjust the rent for maximization of tenant retention and owner profitability is performed.



Detailed Tenant Screening

A credit report, checking several public websites to search for possible problems or evictions in

progress is conducted. Cross-referencing the information the applicant gives with public records

and the credit report is done to verify to catch false information. Proof of their income and other

checks performed as needed. Credit Reports can be accessed 24 hours a day, 7 days a week.



Rental Agreement

Property Management lease agreements are very complete and cover every issue advised to

cover by attorneys. Specific Agreement for properties will be tailored to meet the needs of

customers‟ property.



Monthly Management Reports

Monthly statements detailing all income and expenses and a Year End Report are provided to

customers.



Detailed Invoices of Expenses

A detailed invoice is provided customers monthly on maintenance services, including date the

service was completed, what was done, how many hours it took to complete and how much the

materials cost.



Enforcement of Lease Covenants

Tenants are monitored to see that they are taking care of the unit, that they have not moved in

additional pets or switched pets. When a violation is discovered Property Management addresses

the issue as needed.



Rent Collection

Rent will be directly deposited into customers escrow account each month on the 15th.



Evictions

Property Management handles evictions for customers through retained attorney.

Real Estate Consulting

Provide assistance for investors to find properties that make sense to purchase. Beyond the sale

of commission is paid, Property Management looks at the figures realistically and advise

customers of what can be expected in the future. If the property does not make sense financially,

Property Management has the experience to detect the problems and can warn customers of

potential pitfalls.



Late Charge

In the event that any payment required to be paid is not made within five (5) days of when due,

in addition to such payment or other charges due hereunder, a “late fee” in the amount 10% is

accessed.



Utilities

Property Management monitors utility accounts for properties while vacant. Once tenant moves

in, Property Management verifies that the utilities have been switched to the tenants‟ name.

Utility companies only allow the owner of the property to put utilities into their name so this call

will need to be made by the owner. Property Management does provide a service of making

utility payments if customer provides utility Property Management‟s address.



Winter/Summer Gas Policy with Vacant Units

In an effort to save money and support the green initiative, utilities unnecessary during summer

months or when heat is not needed will be turned off. A Property Management maintenance tech

will be available to meet utility service personnel, to ensure no leaks or problems, lighting the

pilot lights and checking for any immediate mechanical problems with the furnace or water

heater. The labor for the maintenance tech is billed according to our maintenance policy.





PROPERTY MANAGEMENT FEE SCHEDULE



General:

10% of Monthly Rent



General Repairs and Maintenance (Non-Emergency)

$55.00 per Hour + Materials



Leasing/Renewal of Tenant

½ Full Month‟s Rent



Filing and Attending Rent Court for Failure to Pay Rent:

$20.00 Filing Fee + Court Filing Fees ($13.00) + ($5.00)

+ $15/Hour if Need to stand trial at court with tenant

+$55.00 Filing Fee for No Right of Redemption (4 filings/12mo)



Filing Warrant of Restitution

$10.00 Initial Filing Fee + Court Filing Fees ($40.00)

$55.00 Written Notice Issuance Fees + Postal Expenses

+$55.00 Posting of Notice on Property Prior to Eviction

Performing Evictions

+ $350-$500 (average)

+ Dumping Fees



Installation of New Locks

$25.0 per Lock + Materials



Repair/Service Escrow account balance requirements

$300.00 per single unit; $200.00 per multi-family unit



Lead Compliance Inspections:

$50.00 Visual Review Fee for Lead Dust Testing ($25 off cost)

$16.00 per sample for Lead Dust Analysis Testing

$20.00 per X-Ray Test on Site Results



Asbestos Test

$25.00 per Test



Larger Jobs Estimated to Cost more than $300.00 require approval from owner prior to their

completion



Customization

Property Management personalizes service to conform to customer‟s procedures and

requirement; tailor making a program to meet client‟s needs.



Additional Services Available

MLS Data Searches

Pre-foreclosure valuation and preservation

Loss mitigation transactions assistance

Full interior BPO/CMA with marketing recommendations

Monthly marketing reports

Detailed expense accounting

Title searches

Contract Negotiation

Closing facilitation





MAINTENANCE POLICY



New owners receive an inspection to ensure that every property meets Property Management‟s

standards. Owners are responsible for all maintenance charges.



$200 must be kept in an escrow account for maintenance. Any maintenance needs over and

above $200 will consult owner and Property Management provides 2 estimates for work needed.

Quarterly Preventive Maintenance

Property Management offers an optional quarterly service that is very valuable to investors; a

well maintained property can increase its value.





Quarterly Preventatives Maintenance includes:

 Treat the unit for roaches with roach bait (if needed)

 Change the furnace filter

 Check smoke detector batteries and change if needed or replace the smoke detector if

defective or missing

 Conduct a quick inspect of the unit and fill out a fast inspection sheet of unit indicating

what kind of condition the tenant is keeping the unit in, including the cleanliness of the

unit, possible drug use or other violations and report this information to owner on the

next invoice.

 Conduct a quick mechanical inspection of the unit checking for plumbing leaks, safety or

danger hazards such as clothing stored against the water heater or furnace and any other

problems that could affect owner‟s liability or alleviate future problems.

 If Property Management finds something that is a quick fix, such as a toilet that needs a

new flapper, Property Management maintenance will go ahead and make the repair at that

time and deduct it from the escrow account, if the issue cost over $200, the owner is

contacted for directions.





Yard Care and Snow Removal





Advertising & Leasing Fee

Advertising costs are the responsibility of the owner. Due to liability reasons and the many

advertising and discrimination regulations, it is recommended owners not advertise the property.

Property Management provides professional services and knowledge to take care of the

advertising for the owner; all advertising is done in house. The leasing fee will cover all

advertising expenses for properties, which includes:



 Showing/Previewing Properties

 Arranging inspection with tech

 Handling phone calls from prospective tenants

 Flyers, Website, Social Serve site, flyers at Housing Authority, Rentals.com, Craigslist,

and For Rent sign in yard, ect.

 Handles green book for Housing Authority and all tenant move-in needs

 Application for prospective tenant, including background checks, credit check,

employment verification, ect.

 Negotiating lease and getting deposit from tenants

 Miscellaneous items

FACILITIES AND EQUIPMENT PLAN



Van (1)

– used by maintenance to transport necessary tools to-and-from business locations



Make/Model: 2011 Chevrolet Express 3500 Work Van



Cost: $32,287



Salvage Value: $9,287 (based on an average of 30% depreciation over a five year period)



Additional information:

This van has a 72 month/100,000 miles corrosion perforation warranty, basic 36

months/36,000 miles, roadside assistance 60 months/100,000miles, and powertrain

warranty 60 months/100,000 miles





Office Computer (1)

– For daily operations and administration use



Make/Model: Hewlett Packard Pavilion p677y Desktop & Dual 23” LED Monitor

Package



Cost: $899.97, plus tax



Salvage Value: $200



Additional information:

AMD Phenom II quad-core processor 840T; 6GB DDR3 memory; 1 TB hard drive;

Windows 7 Home Premium; built-in wireless networking; two 23” widescreen LED

monitors





Fax, Scanner, Printer Machine (1)

– For daily operations and administration use



Make/Model: Hewlett Packard LaserJet Pro M1536DNF Network-Ready All-In-One

Printer



Cost: $299.99, plus tax



Salvage Value: $50



Additional information:

Energy Star qualified; 10/100 Ethernet LAN; up to 26 ppm in black

Prints, copies, scans and faxes via phone line

Office Facility

– Operations of business

Location: Springfield, Missouri



Terms: Available until the company outgrows the facility @ $200/month



Additional information:

Equipped with 1 landline and business internet access





Cellular Phones (2)

– Operations Communication

Make/Model: Samsung Epic 4G with Sprint



Cost: $400.00 after mail-in Rebate ($200/Epic)



Additional information:

2 year contract

Used by President/General Manager and maintenance personnel





HUMAN RESOURCES PLAN







INFORMATION TECHNOLOGY PLAN

Property Management has established the web site

www.propertymanagement.com. By June 2011, the General Manager, Michael Wacker,

with support from Pollock Engineering will design a website enhancing the brand image

of Property management. This website will be made available to increase investors and

potential customers‟ awareness of Property Management‟s brand.



Starting in April 2011, Property Management will outsource its IT management to

Geek Squad through Best Buy. Property Management estimate our cost within the first

year to be $ which includes website maintenance (promotional updates), website

certificate updates, and security protocols to reduce any attempts of fraudulent activity.

Also, our IT business troubleshooting will be addressed by this firm, such as computer

malfunctioning and software upgrades.







Works Cited

Small Business Council of Springfield Area Chamber of Commerce. (n.d.). Starting a Business

in Springfield, Missouri. Retrieved March 8, 2011, from Starting a Business in

Springfield, Missouri: http://www.business4springfield.com/mediafiles/publication-

startingabusiness.pdf