Step-By-Step Guide to
Building Maintenance Contracts

Preventative Building maintenance contracts are legal agreements between a company and the contractors they hire for building maintenance. These contracts outline the responsibilities, costs, and scheduling required to keep a building in good working order.

Rather than fixing existing problems — although your provider can do this as well — these contracts cover preventative maintenance. This is a strategy that reduces overall risk while saving you money in the long run.

Think of preventative building maintenance like car maintenance. Cars perform best when they’re regularly serviced. By frequently servicing your car, you preserve part integrity, helping you avoid unexpected and financially devastating events. Similarly, consistent building maintenance is a way of fixing small issues before they become massive problems. Maintenance can include:

• Painting to protect interior and exterior surfaces
• Removing rust
• Fixing flooring and ceiling damage
• Reconditioning or replacing structural timber or concrete
• Plumbing and electrical repairs

Getting a building maintenance contract

Once you’ve settled on a building maintenance provider, the first step is usually an on-site inspection. Your provider will then create a quote that details what maintenance work they’ll do. Once details are finalized and the contract is signed, scheduled work can commence.

Building maintenance contracts are essential for keeping your building clean, safe and pleasant to be in. ​​For example, these contracts are essential for medical facilities to maintain HVAC systems and safeguard electrical systems — both of which have an impact on health outcomes.

Here are 5 reasons you should get a building maintenance contract:

1. Improving tenant relationships

Having a preventative maintenance plan helps existing tenants feel that their building is being looked after. This is key in protecting your cash flow, as retaining happy tenants makes more business sense than having to find new ones.

2. Avoid financially devastating repairs

When small issues aren’t dealt with, they can grow into catastrophic problems. For example, moisture buildup in a wall can damage paint and lead to the spread of hazardous mould. The solution would require fixing the moisture issues, removing the mould and repainting large sections of your building. With regular maintenance, your provider could recognise and then fix your moisture issue before it leads to additional damage and costs.

3. Casting your business in a positive light

Your building’s appearance impacts how clients see your business. What would a client think, for example, if they visit your building only to find the elevator is broken and they’re forced to climb the poorly-lit staircase? Ongoing maintenance plans and consistent minor property refurbishment ensure your building is always in top shape and reflects your business or tenants in the best possible light.

4. Maintaining and increasing market value

Although architectural styles change often, properly maintained buildings have a better chance of competing with the ‘new buildings on the block.’ Maintenance contracts preserve your building’s market value, especially if it’s in a high-growth area where value is likely to increase.

5. Injury risk and liability

Neglected properties are likely to have structural hazards such as damaged walkways or ageing wiring that leads to electrical faults. These hazards increase the chance of someone being injured on your property, which can lead to punitive liability costs. Building preventive maintenance plans are a safeguard against the financial and reputational consequences of injury occurring on your property.

In this section, we compare how maintenance contracts and plans compare with once-off building projects. By exploring the pros and cons of each option, you should know what’s best for your building.

Once-off projects

Many building or facility managers are happy to hire once-off contractors. When managing a new facility or building, for example, paying for a lengthy maintenance contract may seem unnecessary.

The Pros

• Contracting different maintenance companies is a good way to test out potential long-term partnerships. You’ll get a sense of what it’s like to work with them and can continue your relationship based on the results of their work.
• Once-off work can be a lifesaver when emergency repairs are needed — getting fast repairs without worrying about long-term contracts.

The Cons

• While once-off projects may seem to keep costs down, they can cause you to overlook preventative maintenance, leading to more expensive fixes and emergency repairs. You may also lose out on discounts available on retainers.
• Unknown and once-off contractors always pose a fly-by-night risk, where they leave before work is complete or they produce substandard work.
• Sourcing and then dealing with once-off contracts can be difficult to manage as you need to look after and coordinate a group of independent specialists. This also increases manager responsibility, as you become responsible for knowing what needs to be fixed and maintained, along with understanding the costs involved.

Maintenance contracts

While once-off projects offer freedom, preventive maintenance contracts provide security and peace of mind. Here’s how a long-term service partnership can help or hinder you.

The Pros

• Preventative maintenance keeps your budget in check by preventing unplanned or emergency repairs — this can save you thousands of dollars while ensuring your building functions as intended. And, with maintenance contracts, if something goes wrong, then your providers will fix it at their expense.
• The right maintenance provider can guarantee emergency support when you need it, saving you the time and effort of sourcing another company. By forming close partnerships, you can also benefit from access to your provider’s trusted referral network.
• Companies with long-term building maintenance contracts in place enjoy reduced legal and financial risk. Generally, quality work is guaranteed as providers will be working with you for a long time. As licensed tradesmen, your contractor will carry the legal risk for each job they complete.

The Cons

• Settling on a building preventative maintenance plan and solutions provider can take a lot of upfront effort. After all this work, many stratas and building managers feel locked into their contract. But this might not be the case — your contract should have a cancellation or renewal clause that can help you get out of an unsatisfactory partnership.
• By signing a maintenance contract, you naturally develop a long-term relationship with your contractor. While this can be an advantage, you may prefer to keep relationships more transactional.

Of course, the above benefits of getting a building maintenance contract are only valid if your provider delivers on their promised value. The trick to unlocking this value is to ensure your maintenance contract is fair and favorable.

From protecting your building maintenance budget to filtering out poor providers, these are our tips and tricks for securing partnerships that provide you with exceptional value:

Avoiding hidden costs — few things are more frustrating than being billed for a larger amount than you expected. With preventative maintenance plans, this can come in the form of hidden indexation in your contract. Essentially, indexation is a calculation that increases your bill depending on the rise in the cost of wages and maintenance products, independent of CPI. This can cause you to blow your maintenance budget without realising it. 

To this end, ensure your provider either doesn’t use indexation fees or that these fees are transparent in your contract. For help working out how much indexation you have to pay, download a free copy of our indexation calculator.

Getting the right maintenance schedule — to properly maintain your building or facility, you need to make sure that your schedule is aligned with what your property requires. To guarantee this alignment, pay close attention to the plan that your provider proposes and ask them to clearly explain how they arrived at that schedule. You may find that your building needs more or even less attention than is proposed.  

Never sign inflexible contracts — how easy is it to leave your contract? As long as you’ve paid your provider, you shouldn’t be forced to stay in a contract that you’re unhappy with. This could be due to performance issues on the side of the provider or changes to your financial circumstances. 

Filtering out poor providers— you can avoid bad providers by performing a small amount of due diligence. If you’re based in Queensland, for example, you can examine their credentials online to see if they’re accredited by the Queensland Building and Construction Commission. You should also look at the state of the buildings they maintain. To gauge professionalism, ask questions like, “Who do I speak to when I have a problem? How can I tell where I stand with compliance and legal issues? Is your company insured? How do you prioritise maintenance requests?”  

Clearly defining project scope — the more specific your contract, the more maintenance work your provider is accountable for. Ideally, your provider can lead this process after assessing your building — as the experts, they should know what maintenance needs to be performed. But you should still define as many tasks as you can. For example, you should include a clause that includes emergency repairs.

Building maintenance contracts afford you peace of mind. They give you an idea of what needs to be fixed and maintained years ahead of time, and on a fixed budget. 

Good maintenance providers extend this peace of mind to their customers. This can range from sending timely reminders about upcoming maintenance to employing the same maintenance teams who can then develop a deep understanding of your procedures. Importantly, good providers continue to communicate long after they win your contract. 

Along with frictionless customer service, the best providers focus on transparency. When renewing your contract, for example, transparent providers generally don’t increase their price by huge amounts. Why? Because their company should have kept your building in good condition, making their job easier and cheaper to do.

We’ve unpacked what to look for in your provider, contract and preventative maintenance plan. Now that you’re armed with this knowledge, here are the five steps to securing the ideal building maintenance contract.

1. Research maintenance providers — after finding a provider, perform due diligence by speaking to their current customers, inspecting their buildings and confirming their accreditation and licensing.  

2. Get an onsite building assessment — your potential provider should visit your building or facility and extensively evaluate its maintenance requirements. This is key in defining the scope of the maintenance project.

3. Negotiate your contract — using our tips above, negotiate for a transparent and flexible contract that includes a favourable exit clause.

4. Assess provider value — after a few months, assess your provider experience. How good is their workmanship and how frictionless is their customer experience? Ask them questions about the quality of the maintenance products they use and how long they last.

5. Include an exit clause in case your provider fails to perform — if your provider fails to meet your expectations, discuss it with them. If they continue to provide subpar value, take advantage of your exit clause and move to a new provider.

While it may take a lot of upfront work, finding a reliable maintenance solutions partner is crucial to keeping your building or facility in good repair — all without blowing your budget. 

At First Response, we provide all-in-one preventative maintenance plans. Having built long-term relationships with schools, retail buildings, hotels and stratas, we have experience maintaining a range of facilities and building types. 

If you’re curious about our services, we offer free and no-obligation quotes for maintenance contracts. For a free quote, click the button below.