Which entity should employ on-site staff (owning LLC vs management LLC)

Topic Author
DF
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7 years 2 months ago - 7 years 2 months ago #18319 by DF
I am curious about an ongoing issue that we have to address as owners and managers of several apartment communities. We are continually debating whether it is most prudent for us to have our owning SPE (ie the LLC that owns the property) employ our on-site staff (PM, Leasing agent, and maintenance), or whether we should place all of our on-site staff, including the on-site managers and maintenance (etc) on our corporate level payroll through our operating entity. At the end of the day, all property related labor expenses are charged at the property level, as the various properties are set up with different partnership structures.
Clearly this is targeted more to owner/operators, and less to solely third party management companies, although I'm sure that those working for third party management companies may also have an opinion. We have found that there are pros and cons to both scenarios, but I'm curious what model owners/operators of larger multifamily communities have found most beneficial and practical?
Thanks in advance,
DF
7 years 2 months ago - 7 years 2 months ago #18319 by DF