Real Property Management Franchise Review: What You Need to Know
Real Property Management is the nation’s leading property management organization and the first in the industry to franchise.
The company was founded over 25 years ago by the two founders who eventually would go on to start the first-ever property management franchise in 2005.
As the first and largest franchise organization in residential property management, and with over 25 years of experience refining property management, is the nation’s trusted leader, recognized by leading reputable sources.
Management Team
Dwyer Group, Inc. is a leading operator of multiple franchise concepts, primarily related to commercial and residential maintenance and repair. The group completed the acquisition of Real Property Management in February 2018. Dwyer Group was founded in 1981 and is headquartered in Waco, Texas. It is one of the world’s largest franchising organizations with more than 3,100 spread over 9 countries, close to 250 franchisees operating through international master licenses, and over 35 company-owned glass stores under the brand name Portland Glass.
Dwyer Group has developed a highly efficient model with a focus on strong franchise support and superior customer service while fostering a unique corporate culture based on a shared Code of Values. Each of the company’s concepts provides need-based services, such as plumbing and appliance repair, that are critical for proper maintenance and often urgent in nature. Dwyer Group is majority owned by The Riverside Company, a private equity firm with locations in North America, Europe, and Asia, and has available growth capital and credit capacity to execute acquisitions in a prompt manner.
The company is lead by a very experienced and supportive management team that helps and trains franchisees so that they have all of the tools to success at their disposal.
Franchise & Real Estate Industry Analysis
Franchise Strengths
- Strength and power of a national brand, technology-driven system, professional marketing, volume purchasing power, and comprehensive training and support
- Relations nurtured through property management can allow for income through real estate sales, etc.
- Ability to generate revenue through multiple revenue streams
Franchise Weaknesses
Franchise Weaknesses
- Other property management firms like All County and Property Management Inc. are entering the space and growing fast.
- Must be willing to put in the time and effort necessary to grow the business for the first few years, but will then have the option to enjoy the freedom that comes through scalability.
Real Estate Franchise Opportunities
Real Estate Franchise Opportunities
- Home ownership rates have fallen as the nation, especially the younger generation, becomes more mobile and less willing to take on a mortgage. The result is an ever increasing number of potential homes to manage and prospective tenants needing a place to live
- Huge market – 1/3 of all U.S. housing is renter occupied and there are 34 million rental locations in the U.S.
- It’s harder to qualify for a mortgage, so more and more homes are being bought by investors who need property managers
- Recession resistant and can actually perform better in a downturn as more people end up renting
Threats in the Real Estate Franchise Market
Threats in the Real Estate Franchise Market
- Potential for new competitors entering the space whether franchise models or corporations
- Potential for very stressful weeks during hurricanes and extreme weather situations
The cost ranges from $86,795 to $117,795 according to the 2018 FDD.
Real Property Management Franchise Cost (2018 FDD)
The cost ranges from $86,795 to $117,795 according to the 2018 FDD.
| Cost Types | Amount (in USD) | When Due | To Whom Payment is to Be Made | |
|---|---|---|---|---|
| Low | High | |||
| Franchise Fee | $45,000 | $60,000 | Upon Effective Date of Franchise Agreement | Us. |
| Rent | $0 | $1,500 | Monthly, as incurred | Your landlord. |
| Rental improvements | $0 | $2,500 | As incurred. | Vendors and/or landlord. |
| Deposits | $0 | $2,500 | As incurred | Utilities and/or landlord. |
Pillar Certification (TrainingProgram, Workshop,PMiLAUNCH andPMiSPRINT) | $0 | $3,800 | As incurred. | Vendors and Us. |
| Equipment and Business Supplies | $500 | $3,000 | As incurred, before opening for business. | Vendors. |
| Computer hardware and software (including PMiSOFT PMiWARE, PMiPrograms, PMiSTR, PMiWorkFlow, Accounting Software (as required) | $675 | $5,950 | As incurred; Once assessed, our software fees are payable monthly, due on the 1st of each calendar month. | Vendors. |
| ResidentialBOOKS (for Doors and Suites) | $0 | $18,000 | Payable on the 1st of each calendar month; mandatory until transition training is completed | Us. |
| AssociationBOOKS (for Units) | $0 | $26,200 | Payable on the 1st of each calendar month; mandatory until transition training is completed | Us. |
| VacationBOOKS (for Keys) | $0 | $12,100 | Payable on the 1st of each calendar month; mandatory until transition training is completed | Us. |
| Local Advertising expenses for period of 3 months. | $4,500 | $13,500 | As incurred, but a minimum of $1,500/month for the Primary Pillar and $1,000/month for each additional Pillar, with any amounts owed to us being due on the 1st of each calendar month. | Us, vendors and advertising companies. |
| Insurance | $750 | $3,000 | Annually (or divided into monthly premium payments), as incurred. | Insurance carrier. |
| Professional services | $0 | $1,500 | As incurred. | Attorneys, accountants and other professionals. |
| EPMC Conversion | $1000 | $10,000 | When Doors, Units, Suites, and Keys are converted to Franchisor Software. | Vendor. |
| Initial Trust Account deposit for Short-Term Rental operations. | $500 | $1,000 | When bank account is established. | Vendor. |
| VOIP Telephone Equipment (3 months not including FCC fees and taxes) | $300 | $500 | As incurred. | Vendor. |
| Additional Funds for period of 3 months | $0 | $20,000 | As needed. | Various. |
Total | $48,225 | $190,050 | ||
| Royalty | Ad-Fund |
| 5.0% | 2.0% |
Historical Revenue for Real Property Management
As of December 31, 2017, PMBS had 203 franchise owners who operated 280 Real Property Management franchises. Monthly reports from these franchise owners provide PMBS’ only visibility into the financial results of the individual franchise owners’ operations. Most franchise owners respond regularly, while some respond less frequently, or not at all. PMBS has not independently verified the data submitted by franchisees.
In PMBS’ effort to provide financial performance data for a representative sample of the Real Property Management franchise network, we took the following steps to provide the averages below:
- Eliminated data from owners in their start-up period. There were 42 franchises whose data was not included because they were within their first 12 months of operation.
- Eliminated data from non-reporting owners. Data for 5 franchises was insufficient and therefore not included.
The following charts represent the average number of units and average revenue per unit being managed by Real Property Management franchisees. The data is broken down according to the age of the franchise, based upon the year the franchise was opened. The average annual revenue per unit data was drawn from the franchisee reports described above.
| 42 |
|---|---|
| Average Units Managed per Franchise | 133 |
| Median Units Managed per Franchise | 89 |
| Average Annual Revenue per Unit | $3,440 |
| Median Annual Revenue per Unit | $2,983 |
| Total Reporting Franchises Over 3 Years Old | 191 |
| Average Units Manged per Franchise | 262 |
| Median Units Managed per Franchise | 194 |
| Average Annual Revenue per Unit | $2,826 |
| Median Annual Revenue per Unit | $2,659 |
| Total Reporting Franchises Overall | 233 |
| Average Units Manged per Franchise | 236 |
| Median Units Managed per Franchise | 149 |
| Average Annual Revenue per Unit | $2,952 |
| Median Annual Revenue per Unit | $2,835 |
| Total Reporting Franchises Overall | 224 |
| Average Rent | $1,143 |
| Median Rent | $1,065 |
-The above figures are based on the Item 19 of Real Property Management 2021 FDD
–Some franchises have had the results described above. There is no assurance that you will do as well.
