There’s a conversation happening in property management that most multifamily operators aren’t part of yet, but single-family rental companies figured it out years ago. 

Right now, in most multifamily organizations, maintenance is buried somewhere in your management fees. It’s treated as overhead: something to track, control, and ideally minimize. You assign a tech to a building, bill it through as a resource cost, and move on. Meanwhile, those management fees keep getting compressed, squeezing your margins tighter and tighter. 

But here’s what I’ve been hearing in conversations with property managers: What if maintenance could nearly double a property management company’s total revenue? 

In fact, it’s already happening, just not where most multifamily operators are looking. In single-family rentals and among smaller, more agile property management companies, maintenance isn’t a cost center anymore. It’s a revenue center. And that shift changes things significantly. 

This is a fundamental restructuring of how maintenance operates, how maintenance leaders are positioned in your organization, and what kind of careers you can offer your techs. It’s also uncomfortable, because it requires a level of accountability that many maintenance departments haven’t had to face. 

But if you’re struggling with maintenance’s role and profile in your organization (for example, if you can’t get budget for the investments you know you need, if your techs are leaving for marginal pay increases elsewhere, if preventative maintenance is always the last priority) this might be the paradigm shift you need. 

What Maintenance as a Revenue Center Actually Means 

When maintenance operates as a revenue center, it functions as its own business unit that bills for services. The revenue is still through to clients, but it’s tracked, measured, and optimized separately from your general management operations. 

This is different from the typical model, where maintenance costs are either included in management fees or billed back to owners as overhead. In that structure, maintenance is something that happens to you. You’re managing costs, putting out fires, and trying to keep expenses down. 

In a revenue model, maintenance is something you’re actively managing as a profit-generating operation. You’re tracking utilization rates, billable hours, and efficiency metrics. You’re investing in systems and people because you can see the return. You’re making strategic decisions about staffing, technology, and preventative programs based on revenue impact. 

Where is this happening? It’s very common practice in single-family rental management, in all sizes of organizations. And increasingly, smaller multifamily property management companies (the ones that can move quickly and adapt) are making this shift. It’s aninnovator’s dilemma situation: the smaller, more agile organizations are adopting a new model that the larger, established players are either ignoring or too slow to implement. 

Maintenance revenue can nearly double the overall revenue at the property management level. That’s what’s happening in organizations that have made this shift. 

The Math Behind Maintenance Revenue 

Peter Lohmann, who built a $1M/year in-house maintenance operation at RL Property Management, has a formula that breaks this down: 

Maintenance Revenue Target = 40h × 4.33 × Billing Rate × #Techs × Utilization × 1.2 

• 40h = Full-time hours per week 
• 4.33 = Average weeks per month 
• Billing Rate = What you charge owners per hour (not what you pay the tech) 
• #Techs = Number of billable, full-time technicians 
• Utilization = Percentage of paid hours that are actually billable (target: 88-92%) 
• 1.2 = Markup for materials and pass-through costs 

In this scenario, you need to charge at least 3x your tech’s hourly wage. If you’re paying a tech $28/hour and only charging $60/hour, you’re going to lose money. Between overhead, PTO, insurance, non-billable time at Home Depot, team meetings, and everything else, that margin disappears fast. 

Let’s run a real example. Say you have: 

• 3 full-time techs 
• $84/hour billing rate (3x a $28/hour wage) 
• 90% utilization rate 

Plug that into the formula: 

40 × 4.33 × 84 × 3 × 0.9 × 1.2 = ~$47,000 per month 

That’s your target. That’s what needs to show up in your maintenance revenue account every month to keep the operation profitable. If you’re not hitting that number, you’re subsidizing maintenance for your owners, which means you’re losing money even if it feels like everything’s running smoothly. 

Read Peter Lohmann’s full article on running profitable in-house maintenance: Running In-House Maintenance? You Need This Formula 

The Important Performance Metrics  

Once you shift to a revenue model, you’re managing to a completely different set of metrics. This is where the accountability piece comes in. You can’t just track whether work orders are getting done. You need to understand: 

Billable hours per tech. How many hours is each technician actually billing versus how many hours they’re being paid? This is the difference between utilization (what they’re working on) and realization (what you can bill for). In a consulting business, which is essentially what maintenance becomes, this is everything. 

Utilization rates. You should be targeting 88-92% utilization. That means if a tech works 40 hours in a week, 35-37 of those hours should be billable to actual work orders. The rest is overhead: team meetings, training, travel time between jobs, supply runs. 

Material cost recovery. Every dollar spent on materials should be captured and billed back to the owner. If your techs are swiping company cards for supplies and you’re not tracking those expenses against work orders, you’re losing money. This requires auditing credit card statements line by line against owner invoices. 

Work order completion rates. Every work order needs at least one billable hour attached to it, and it needs to get closed out. If you have work orders sitting open for months because a tech “just needs to go back and finish up,” that’s unbilled revenue sitting on your books. 

Most maintenance departments don’t track these metrics today. But if you’re running maintenance as a revenue center, they become non-negotiable. 

What Changes When Maintenance Becomes Revenue 

The shift from cost center to revenue center changes your P&L. It also changes everything about how maintenance operates and how maintenance professionals are positioned in your organization. 

For Maintenance Leaders 

When maintenance generates revenue, it stops being a manager-level function and becomes an executive-level position. You’re driving profit. That means you finally get a seat at the table in strategic planning conversations. 

Suddenly, the investments you’ve been asking for, such as centralization, automation, offshore support, better technology, become justifiable. When you can show the revenue impact, you can build the business case. Want to implement a preventative maintenance program? As a cost center, that’s a hard sell. As a revenue center, it’s a growth opportunity because finding issues creates billable work. 

Some people worry that creating revenue from found issues is a conflict of interest. But actually, it aligns incentives correctly. When maintenance is a revenue center, you’re incentivized to prioritize preventative maintenance because that’s what finds problems early, before they become emergencies. Owners benefit because they’re getting proactive care for their assets instead of reactive firefighting. 

The trade-off is accountability. As a revenue center, you’re responsible for forecasts. For hitting targets. For managing efficiency metrics you may not be tracking today. You’re moving from being a “receiver,” someone who manages what happens to them, to being a “maker”, someone who makes things happen. 

For Maintenance Techs 

For the people actually turning wrenches, the revenue model creates real career paths. When maintenance is a cost center, compensation is flat. Raises are hard to find. Career progression is muddy. Top performers leave for $2 more per hour somewhere else. 

When maintenance generates revenue, performance bonuses become possible. You can reward productivity and efficiency. You can invest in training and development because you can see the return on that investment. You can build compensation structures that actually retain top talent. 

This means maintenance techs can have real, long-term careers in property management instead of just jobs. That’s better for everyone: better for the techs, better for your organization, better for the residents who get consistent, high-quality service from experienced professionals. 

For Clientsand Asset Managers 

From the owner’s perspective, the revenue model drives better outcomes. When maintenance is a profit center, you are being supported with a profit motive. That means more proactive maintenance programs, better systems and processes, and increased transparency on costs and value delivered. 

Preventative or even prescriptive maintenance start being a revenue opportunity. That benefits owners because they’re getting issues identified and resolved before they become expensive emergencies. NOI improves because you’re maintaining assets properly instead of letting deferred maintenance pile up. 

And because everything is tracked and measured, owners get better visibility into exactly what maintenance work is being done and what it costs. There’s less mystery, less confusion, and more accountability. 

The Uncomfortable Parts of Maintenance as Revenue 

Let’s be honest about what this shift requires, because it’s significant. 

First, there’s the personal discomfort. If you’re a maintenance leader who’s been operating in a cost-center world, moving to a revenue model means learning a new set of skills. You need to master revenue forecasting, utilization management, billing structures, and efficiency metrics. You need to hit numbers. You need to be comfortable with a different accountability that you may not have faced before. 

Some maintenance professionals will struggle with this. The mindset shift from “I manage what happens to me” to “I make things happen” is real. It requires taking ownership in a way that cost centers never demanded. 

Second, there’s organizational change. You need to restructure property management agreements. You need to change contracts. You need to get buy-in from owners who are used to seeing maintenance as overhead. You need executive leadership to support a fundamentally different business model. 

Third, there’s the infrastructure investment. Organizations that successfully run maintenance as a revenue center have made real investments: 

• Offshore resources supporting operations 
• Centralized systems and processes 
• Clear billing structures and invoicing systems 
• Strong performance tracking and analytics 
• Technology and automation that drives efficiency 

This means restructuring how maintenance operates from the ground up. It requires executive-level strategic thinking, not just operational management. 

What It Takes to Make the Shift 

So what does it actually take to move from maintenance as a cost center to maintenance as a revenue center? 

First, you need the right systems. Companies doing this successfully have invested in centralization and automation. They’re using offshore resources to handle scheduling, work order management, and invoicing. They’re leveraging technology to track utilization, manage billing, and optimize routes and assignments. 

Second, you need clear processes. Every work order needs to be tracked from creation to completion to invoicing. Material costs need to be captured and billed back. Utilization needs to be monitored weekly. Someone needs to own these numbers and watch them like a hawk. 

Third, you need the right people. Running maintenance as a revenue center requires leaders who can think strategically about business operations, not just operationally about fixing things. It requires techs who understand that their productivity directly impacts their compensation. It requires buy-in at every level. 

Fourth, you need transparency with owners. The revenue model only works if owners understand what they’re paying for and why. That means clear invoicing, regular communication, and demonstrating the value of proactive maintenance versus reactive repairs. 

And finally, you need to be ready for the accountability. Revenue centers live and die by their numbers. If you’re not hitting your targets, everyone knows. If your utilization is slipping, it shows up immediately. If work orders are sitting unbilled, it impacts your revenue. 

That accountability is uncomfortable. But it’s also what gets you a seat at the table. 

The Self-Assessment: Are You Ready? 

If you’re reading this and thinking about whether this shift makes sense for your organization, here’s what I’d recommend: take 30 minutes and write out answers to three questions. 

1. How would this change my life as a maintenance leader? 

Think about the positives: bonuses tied to performance, a seat at strategic planning tables, budget for the investments you’ve been wanting to make, the ability to finally prioritize preventative maintenance. Also think about the challenges: accountability for hitting numbers, learning new skills around forecasting and utilization management, shifting from reactive to proactive mindset. 

2. How would it change my team’s lives? 

Consider what it would mean for your techs: real career paths, performance bonuses, investment in training and development, compensation that rewards productivity. Also consider what it would require from them: higher expectations, more accountability, better tracking of hours and materials. 

3. How would it benefit my owners? 

Think about the value proposition: more proactive maintenance, better NOI through preventative programs, increased transparency on costs and value, higher quality service delivery. Also think about the change management: new billing structures, different contract language, a shift in how they think about maintenance costs. 

Then create a T-account. On one side, list the problems you’re facing today as a cost center. On the other side, write out how those problems might be solved as a revenue center. 

Finally, ask yourself: What discomforts would I personally need to overcome to make this shift? What skills would I need to develop? What support would I need from leadership? 

If you’re ready for the accountability that comes with being a revenue center, you also get the seat at the table. Are you ready for that change? 

The Bottom Line 

This shift is already happening. It’s standard in single-family rentals. It’s emerging in smaller multifamily property management companies. Maintenance as a revenue center is clearly viable. The question is whether you’ll be early or late to adopt it. 

Cost centers drift toward status quo. They’re about maintaining the current state, minimizing costs, and staying within budget. Revenue centers drift toward innovation. They’re about growth, optimization, and finding new ways to create value. 

If you’re struggling with maintenance’s role and profile in your organization, if you can’t get budget for technology investments, if your best techs keep leaving, if preventative maintenance never gets prioritized, the problem might not be your people or your processes. It might be that you’re trying to operate a revenue-generating function within a cost-center structure. 

The paradigm shift from cost to revenue is significant. It’s uncomfortable. It requires real change at every level. But for organizations willing to make that shift, the benefits are clear: better careers for maintenance professionals, more proactive maintenance for owners, and real profit for property management companies. 

The tools and models exist. Peter Lohmann has documented the formula. Single-family rental companies have proven the model works. Smaller property management companies are already implementing it successfully. 

Now the question: is this the shift you need to make? And how will you prepare?