Detailed Estimates of Real Property Management Franchise Costs Based on Item 7 (Estimated Initial Investment) of Real Property Management’s 2019 Franchise Disclosure Document
1. Initial Franchise Fee: $45,000
- If you are approved as a new franchisee, your Minimum Initial Franchise Fee will be $45,000. You may qualify for a discount on the initial franchise fee.
- You must pay the initial franchise fee in full when you sign the Franchise Agreement.
- Although the franchisor does not typically finance, it may agree to finance a portion of the initial franchise fee, depending on your credit-worthiness, the collateral that you have available, and its then-current financing policies.
2. Marketing (3 months): $3,000 to $4,500
3. Real Estate/Rent: $500 to $5,000
- You must lease or otherwise provide a suitable facility for the operation of the Business. Typically, the facility will range in size from 500 to 1,000 square feet of space. Lease costs will vary based upon square footage, cost per square foot, and required maintenance costs.
- The low estimate is based on an assumption that you will have to pay a security deposit equal to one month’s rent to lease the facility and is based on leasing a facility of 500 square feet.
- The high estimate is based on an assumption that you will have to pay a security deposit equal to 2 months’ rent to lease the facility and is based on leasing a facility of 1,000 square feet at a higher cost per square foot.
- The estimated range of costs in this category only includes your costs to enter into a lease agreement for the facility. Estimated rental costs for an additional 3 months are included with the category “Additional Funds”.
4. Utility Deposits: $100 to $300
- If you are a new customer of your local utilities, you will generally have to pay deposits to obtain services, including electric, telephone, gas, and water.
5. Leasehold Improvements: $0 to $1,000
- To adapt a newly-acquired facility for operation of the franchised business, it may have to be renovated. The cost of the leasehold improvements will vary depending on factors, including the size, condition, and location of the facility, local wage rates, and the cost of materials.
- The low estimate assumes that your landlord will provide a build-out allowance.
6. Insurance: $2,000 to $5,500
- Factors that may affect your cost of insurance include the size and location of the franchised business, value of the leasehold improvements, number of employees, and other factors.
7. Office Equipment and Supplies: $2,000 to $3,000
- You must purchase general office supplies including stationery, business cards, and typical office equipment, including your computer and required software. Factors that may affect your cost of office equipment and supplies include local market conditions, competition among suppliers, and other factors.
8. Training: $1,000 to $2,000
- The cost of initial training is included in the Minimum Initial Franchise Fee, but you are responsible for transportation and expenses for meals and lodging while attending training. The total cost will vary depending on the number of people attending, how far you travel, and the type of accommodations you choose.
9. Signage: $200 to $1,000
- This range includes the cost of all signage used in the Business. The signage requirements and costs will vary based upon the size and location of the franchised business, local zoning requirements, landlord requirements, and local wage rates for installation, among other things.
10. Furniture, Fixtures, and Equipment: $500 to $2,000
- You must purchase or lease and install certain furniture, fixtures, and equipment to outfit and equip the Business. The cost of the furniture, fixtures, and equipment will vary according to local market conditions, the size of the facility, suppliers, and other related factors.
11. Property Management Software (one-time set-up fee, plus 3 months’ subscription fee): $935
- You must purchase and use the approved Property Management Software (currently, Appfolio). This software must be utilized for all properties managed, except in those limited instances where the software is not in compliance with local or state laws in your area.
12. System Technology Fee (3 months): $385
13. Task Management Software: $325 to $975
14. Licenses and Permits: $500 to $1,000
- State and local government agencies typically charge fees for construction permits and operating licenses, including real estate brokerage license fees. Your actual costs may vary from the estimates based on the requirements of state and local government agencies.
15. Legal and Accounting: $250 to $5,000
- You will need to employ an attorney, an accountant, and other consultants to assist you in establishing your Business. Additionally, the franchisor strongly recommends that you hire an attorney to review all forms or documents that are provided to you for use in your Business to ensure that they meet the specific legal requirement in your jurisdiction.
- These fees may vary from location to location depending upon the prevailing rates of local attorneys, accountants, and consultants.
16. Dues and Subscriptions: $100 to $200
- You are expected to join the local Chamber of Commerce and other local business networking organizations.
17. Additional Funds (3 months): $30,000 to $40,000
- The franchisor recommends that you have a minimum amount of money available to cover operating expenses, including rent, utilities, and employees’ salaries, for the first 3 months that the Business is open.
- The franchisor cannot guarantee that its recommendation will be sufficient. Additional working capital may be required if sales are low or operating costs are high.
18. Total: $86,795 to $117,795
- In compiling this chart, the franchisor relied on its and its affiliates’ industry knowledge and experience. The amounts shown are estimates only and may vary for many reasons, including, but not limited to, the size and condition of your facility, the capabilities of your management team, where you locate your Business, and your business experience and acumen.