Management Agreement

Management agreement is the asset-lightest possible coliving operator structure. The operator provides branding, ops, sales, and community management; the owner retains the property and bears operating risk. The operator earns a management fee, typically 4-8% of revenue plus an incentive fee on NOI above a threshold.

This structure suits operators that want pure platform exposure (no property risk) and owners that want professional operations without giving up the asset. It's lower-margin per property than master lease (the operator captures less upside) but allows much faster portfolio expansion.

The fee structure has three common variants. **Pure revenue fee** (4-8% of gross revenue), simple, predictable, but creates moral hazard: the operator gets paid even when they're not running NOI well. **Base + incentive** (3-5% base + 15-25% of NOI above a hurdle, typically 25-35% NOI margin), aligns incentives but requires careful hurdle calibration; too low and the operator captures uneconomic upside, too high and they stop trying. **Pure NOI share** (no base, 20-30% of NOI), strongest alignment but operators rarely accept this for new markets because lease-up months kill their cash flow.

For owners, the critical contract terms are: minimum performance standards (occupancy floor, NPS floor, rent comparables), termination rights (typically 12-month notice or for-cause), capex contribution rules (who funds replacement furniture, FF&E refresh, capex repairs), and IP ownership at exit (does the operator brand stay with the property if the contract terminates, or does it walk?). Standard institutional deals have these in writing; smaller operator partnerships often hand-wave them, and that's where post-launch disputes start.