(a) |
Lease
Obligations.
Manager shall perform all duties of the landlord under all leases
insofar
as such duties relate to operation, maintenance, and day-to-day
management. Manager shall also provide or cause to be provided, at
Owner’s
expense, all services normally provided to tenants of like premises,
including, where applicable and without limitation, gas, electricity
or
other utilities required to be furnished to tenants under leases,
normal
repairs and maintenance, and cleaning, and janitorial service. Manager
shall arrange for and supervise the performance of all installations
and
improvements in space leased to any tenant which are either expressly
required under the terms of the lease of such space or which are
customarily provided to tenants.
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(b) |
Maintenance.
Manager shall cause the Properties to be maintained in the same manner
as
similar properties in the area. Manager’s duties and supervision in this
respect shall include, without limitation, cleaning of the interior
and
the exterior of the Improvements and the public common areas on the
Properties and the making and supervision of repair, alterations,
and
decoration of the Improvements, subject to and in strict compliance
with
this Management Agreement and any applicable leases. Construction
and
rehabilitation activities undertaken by the Manager, if any, will
be
limited to activities related to the management, operation, maintenance,
and leasing of the Property (e.g., repairs, renovations, and leasehold
improvements).
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(c) |
Leasing
Functions.
Manager shall coordinate the leasing of the Properties and shall
negotiate
and use its best efforts to secure executed leases from qualified
tenants,
and to execute same on behalf of Owner, if requested, for available
space
in the Properties, such leases to be in form and on terms approved
by
Owner and Manager, and to bring about complete leasing of the Properties.
Manager shall be responsible for the hiring of all leasing agents,
as
necessary for the leasing of the Properties, and to otherwise oversee
and
manage the leasing process on behalf of the
Owner.
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(d) |
Notice
of Violations.
Manager shall forward to Owner promptly upon receipt all notices
of
violation or other notices from any governmental authority, and board
of
fire underwriters or any insurance company, and shall make such
recommendations regarding compliance with such notice as shall be
appropriate.
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(e) |
Personnel.
Any personnel hired by Manager to maintain, operate and lease the
Property
shall be the employees or independent contractors of Manager and
not of
the Owner. Manager shall use due care in the selection and supervision of
such employees or independent contractors. Manager shall be responsible
for the preparation of and shall timely file all payroll tax reports
and
timely make payments of all withholding and other payroll taxes with
respect to each employee.
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(f) |
Utilities
and Supplies.
Manager shall enter into or renew contracts for electricity, gas,
steam,
landscaping, fuel, oil, maintenance and other services as are customarily
furnished or rendered in connection with the operation of similar
rental
property in the area.
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(g) |
Expenses.
Manager shall analyze all bills received for services, work and supplies
in connection with the maintaining and operating the Properties,
pay all
such bills, and, if requested by Owner, pay, when due, utility and
water
charges, sewer rent and assessments, any applicable taxes, including,
without limitation, any real estate taxes, and any other amount payable
in
respect to the Properties. All bills shall be paid by Manager within
the
time required to obtain discounts, if any. Owner may from time to
time
request that Manager forward certain bills to Owner promptly after
receipt, and Manager shall comply with any such request. It is understood
that the payment of real property taxes and assessment and insurance
premiums will be paid out of the Account (as hereinafter defined)
by
Manager. All expenses shall be billed at net cost (i.e., less all
rebates,
commissions, discounts and allowances, however
designed).
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(h) |
Monies
Collected.
Manager shall collect all rent and other monies from tenants and
any sums
otherwise due Owner with respect to the Properties in the ordinary
course
of business. In collecting such monies, Manager shall inform tenants
of
the Properties that all remittances are to be in the form of a check
or
money order. Owner authorizes Manager to request, demand, collect
and
receipt for all such rent and other monies and to institute legal
proceedings in the name of Owner for the collection thereof and for
the
dispossession of any tenant in default under its lease.
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(i) |
Banking
Accommodations.
Manager shall establish and maintain a separate checking account
(the
“Account”)
for funds relating to the Properties. All monies deposited from time
to
time in the Account shall be deemed to be trust funds and shall be
and
remain the property of Owner and shall be withdrawn and disbursed
by
Manager for the account of Owner only as expressly permitted by this
Management Agreement for the purposes of performing the obligations
of
Manager hereunder. No monies collected by Manager on Owner’s behalf shall
be commingled with funds of Manager. The Account shall be maintained,
and
monies shall be deposited therein and withdrawn therefrom, in accordance
with the following:
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(j) |
Tenant
Complaints.
Manager shall maintain business-like relations with the tenants of
the
Properties.
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(k) |
Ownership
Agreements.
Manager has received copies of the Agreement of Limited Partnership
of the
OP and the constitutive documents of the Company (collectively, the
“Ownership
Agreements”)
and is familiar with the terms thereof. Manager shall use reasonable
care
to avoid any act or omission which, in the performance of its duties
hereunder, shall in any way conflict with the terms of the Ownership
Agreements.
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(l) |
Signs.
Manager shall place and remove, or cause to be placed and removed,
such
signs upon the Properties as Manager deems appropriate, subject,
however,
to the terms and conditions of the leases and to any applicable ordinances
and regulations.
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(a) |
Records.
Managers shall maintain all office records and books of account and
shall
record therein, and keep copies of, each invoice received from services,
work and supplies ordered in connection with the maintenance and
operation
of the Properties. Such records shall be maintained on a double entry
basis. Owner and persons designated by Owner shall at all reasonable
time
have access to and the right to audit and make independent examinations
of
such records, books and accounts and all vouchers, files and all
other
material pertaining to the Properties and this Management Agreement,
all
of which Manager agrees to keep safe, available and separate from
any
records not pertaining to the Properties, at a place recommended
by
Manager and approved by Owner.
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(b) |
Quarterly
Reports.
On or before the 30th day of the first month following each calendar
quarter for which such report or statement is prepared and during
the term
of this Management Agreement, Manager shall prepare and submit to
Owner
the following reports and
statements:
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(i) |
Rental
collection record;
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(ii) |
Quarterly
operating statement;
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(iii) |
Copy
of cash disbursements ledger entries for such period, if
requested;
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(iv) |
Copy
of cash receipts ledger entries for such period, if
requested;
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(v) |
The
original copies of all contracts entered into by Manager on behalf
of
Owner during such period, if requested;
and
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(vi) |
Copy
of ledger entries for such period relating to security deposits maintained
by Manager, if requested.
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(c) |
Budgets
and Leasing Plans.
Not later than November 15 of each calendar year, Manager shall prepare
and submit to Owner for its approval an operating budget and a marketing
and leasing plan on the Properties for the calendar year immediately
following such submission. The budget and leasing plan shall be in
the
form of the budget and plan approved by Owner prior to the date thereof.
As often as reasonably necessary during the period covered by any
such
budget, Manager may submit to Owner for its approval an updated budget
or
plan incorporating such changes as shall be necessary to reflect
cost
over-runs and the like during such period. If Owner does not disapprove
any such budget within 30 days after receipt thereof by Owner, such
budget
shall be deemed approved. If Owner shall disapprove any such budget
or
plan, it shall so notify Manager within said 30-day period and explain
the
reasons therefor. Manager will not incur any costs other than those
estimated in any budget except for:
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(i) |
maintenance
or repair costs under $5,000;
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(ii) |
costs
incurred in emergency situations in which action is immediately necessary
for the preservation or safety of the Property, or for the safety
of
occupant or other person (or to avoid the suspension of any necessary
service of the Property);
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(iii) |
expenditures
for real estate taxes and assessment;
and
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(iv) |
maintenance
supplies calling for an aggregate purchase price less than
$25,000.
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(d) |
Returns
Required by Law.
Manager shall execute and file when due all forms, reports, and returns
required by law relating to the employment of its
personnel.
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(e) |
Notices.
Promptly after receipt, Manager shall deliver to Owner all notices,
from
any tenant, or any governmental authority, that are not a routine
nature.
Managers shall also report expeditiously to Owner notice of any extensive
damage to any part of the
Properties.
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(a) |
Manager
shall obtain and keep in full force and effect insurance on the Properties
against such hazards as Owner and Manager shall deem appropriate,
but in
any event insurance sufficient to comply with the leases and the
Ownership
Agreements shall be maintained. All liability policies shall provide
sufficient insurance satisfactory to both Owner and Manager and shall
contain waivers of subrogation for the benefit of
Manager.
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(b) |
Manager
shall obtain and keep in full force and effect, in accordance with
the
laws of the state in which each Property is located, employer’s liability
insurance applicable to and covering all employees of Manager at
the
Properties and all persons engaged in the performance of any work
required
hereunder, and Manager shall furnish Owner certificates of insurers
naming
Owner as a co-insured and evidencing that such insurance is in effect.
If
any work under this Management Agreement is subcontracted as permitted
herein, Manager shall include in each subcontract a provision that
the
subcontractor shall also furnish Owner with such a
certificate.
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(a) |
One
year from the date of the commencement of the term hereof. However,
this
Management Agreement will be automatically extended for an additional
one
year period at the end of each year unless any party gives sixty
(60) days
written notice to the others of its intention to terminate this Management
Agreement; or
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(b) |
Immediately
upon the occurrence of any of the
following:
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(c)
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Upon
written notice from the Owner in the event that the Manager commits
an act
of gross negligence or willful misconduct in the performance of its
duties
hereunder.
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(a) |
Manager
shall deliver to Owner, or its designee, all books and records with
respect to the Properties.
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(b) |
Manager
shall transfer and assign to Owner, or its designee, all service
contracts
and personal property relating to or used in the operation and maintenance
of the Properties, except personal property paid for and owned by
Manager.
Manager shall also, for a period of sixty (60) days immediately following
the date of such termination, make itself available to consult with
and
advise Owner, or its designee, regarding the operation, maintenance
and
leasing of the Properties.
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(c) |
Manager
shall render to Owner an accounting of all funds of Owner in its
possession and shall deliver to Owner a statement of Management Fees
claimed to be due Manager and shall cause funds of Owner held by
Manager
relating to the Properties to be paid to Owner or its
designee.
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Owner:
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LIGHTSTONE
VALUE PLUS REAL ESTATE INVESTMENT TRUST II, INC.
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By: | ||
Name:
Title:
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LIGHTSTONE
VALUE PLUS REIT II LP
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By: |
Lightstone Value Plus Real Estate
Investment Trust II, Inc.,
its
General Partner
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By:
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Name:
Title:
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BEACON
PROPERTY MANAGEMENT, LLC
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By: | ||
Name:
Title:
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