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Tap Into Maintenance for a New Profit Center


In a recent survey of rental property owners, 61% named their single greatest source of stress as maintenance. For construction firms of all sizes, this represents a huge potential for new business. Not only can the maintenance work by itself help to fill in the typical highs and lows in business cycles, but it is also a source of new projects like upgrades, remodeling, or completely new construction.

Here are some tips for breaking in:

Decide Where You Fit

This is easier for some trade contractors to do because their services are often already highly maintenance oriented, like plumbers and electricians. In these cases, it’s comes down to figuring out where you can compete in the existing marketplace. You might customize your service business for commercial and residential rental property owners by providing response guarantees, and stocking parts that specifically fit their properties. Think of all the ways a contract with the property owner will allow you to offer customized services, and then include those in your proposal.

One big challenge rental property owners complain about is damage done by tenants. This damage happens at all hours of the day and night, and it runs the gamut from unintentional accidents to intentional vandalism and theft. More than half of the rental property survey respondents said they’d rather have someone else deal with maintenance and emergencies. Whatever you can offer that will relieve some of the headaches from the owner or property manager, will provide a competitive advantage against entrenched services companies.

The main areas owners report as headaches for upkeep are roofing, painting, foundational and landscaping. Forty-one percent of owners reported having these costs in any given year, and sadly in most cases these costs shouldn’t be surprises. Offering low or no cost assessments at regular intervals would help owners anticipate upcoming expenses, reduce emergency repairs, and serve your own needs for additional work. The key is trust.

If you go over the property with the owner and explain the areas you see as concerns and why, they can see that your approach is reasonable, thorough and prudent. Another option is to involve a third party property inspector initially so you aren’t recommending the work that you will ultimately do.

General contractors have a unique role to fill in rental property maintenance because of their own expertise and their contacts with the trades and suppliers. A GC can gain advantages by offering maintenance services under contract because it allows them to have recurring work to even out the ups and downs of the construction market cycles. If you can involve your most valued subcontractors, then you can not only offer a turnkey range of services, but you also help those subs weather the leaner times.

Maintenance contracts are often set up to pay the contractor a fixed portion of the annual contract each month, so that provides a steady stream of cash.

Create Your Contract Offerings

Since rental properties get a lot of hard use, a good starting point is to offer a preventive maintenance contract. Some clients’ properties will get used more than others, so you carefully need to structure your offerings with a great deal of customization.

For all types of rental properties, repairs, upgrades, and painting must get done between tenants. On the commercial side, there is the option to do the “build-to-suits” between tenants. It’s also not unusual for owners to schedule upgrades at times when the property is empty. If you are providing the maintenance, then you have a foot-in-the-door for repairs and upgrades. You also know the property’s structure and layout, putting you in a good position to advise on upcoming repairs and upgrades.

As you build your service structure, be thinking of ways you can solve your customers’ problems and cater to their unique needs. Consider the following:

  • Flexible scheduling where clients can choose round the clock (24X7) or weekday (5X8) service
  • Sourcing parts and supplies that complement the building’s features, and maintaining them in a ready inventory
  • Regular assessments of conditions to detect excessive wear and pending problems
  • Inspections to determine causes of damages or breakdowns
  • Dedicated contact person
  • End of contract-term assessments to verify effectiveness and efficiency, and to help fairly price the upcoming contract

Assess Your Costs Carefully

If you’re going to run a maintenance operation, you need to develop the back office systems to support it. These aren’t the same as the systems you use for construction projects––although many of your technology tools can do double duty. The biggest challenge is getting set up to deal with incoming calls for maintenance and repairs at all hours. This will cost you most in personnel, training, and additional resources like tools, supplies, and equipment.

Your personnel costs will include credentialing. That means thorough background checks and an ID or badge system so clients and tenants are reasonably assured of their safety. You will also need to assure clients that your people are trained and certified as necessary for the roles they perform, including OSHA certifications.  

Even if the people who do the work are well skilled in what they do, they will still need to train in customer service. Most people who work on construction sites are not used to dealing directly with customers. And, in this case, they will also be dealing with tenants. They need to know how to react to the multiple scenarios they’ll encounter when not working on a controlled jobsite. There are various safety issues they must beware of, and they must understand how to keep the work area safe for themselves as well as for the general public.

If you will maintain inventory related to the property, there’s more to consider than just the space. You also need a way to catalog and manage it. Tool kits dedicated to specific tasks will streamline the movement of crews to the work, but it also means those items won’t be available for unrelated tasks. You might also have investments in equipment and vehicles or increased vehicle allowances.

You will definitely need a good review of your insurance coverage with an eye for picking up additional insurance to cover new risks. And, you’ll need to very carefully evaluate each new contract based on the existing condition of the property relative to the maintenance expected throughout the contract.

In many ways, your construction company is already in the service business. When you move into the rental property maintenance market you expand your customer base, and add ongoing work along with ongoing income.


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