Owning a rental cabin provides you with a tangible asset while the Management Company manages the day-to-day work involved in placing it with hirers, collecting rent, maintaining the cabin and administering the current regional pool.
The cabin purchase and the management arrangement are covered by separate agreements. Cabins To Go manufactures and sells the cabin, while the Management Company manages it within each pool.
Select and Purchase Your Cabin
Choose the cabin model and number of cabins you wish to purchase. Each cabin is individually identified and remains your property.
Your ownership is not transferred to the Management Company when the cabin enters the managed rental pool.
Enter the Cabin Management Agreement
You enter into a Cabin Management Agreement with the Management Company for each investment cabin.
The agreement begins when it is signed and continues for as long as you own at least one cabin within the managed pool.
Under the agreement, the Management Company receives exclusive possession of the cabin for management purposes, but not ownership. This allows the management team to place the cabin with hirers and carry out the services required to operate the rental pool.
Your Cabin Enters the Managed Pool
Your cabin becomes part of a larger pool of investor-owned rental cabins.
Rental revenue and many operating expenses are combined across the pool. Each owner then receives a proportionate share of the available monthly income according to the calculation set out in the Cabin Management Agreement.
Pooling helps reduce the effect of an individual cabin being temporarily between hires, although income can still vary from month to month.
We Manage the Rental Process
The Management Company provides the ongoing services required to manage and operate your cabin as a rental asset. These services include:
Cabin hire agreements are entered into by the Management Company in its own name while acting as the owner’s agent. The identity of the individual cabin owner is not normally disclosed to the hirer.
Hirer Bonds and Cabin Condition
The Management Company collects bonds from cabin hirers and holds them in a trust account.
When a cabin is returned, its condition is assessed and the bond may be used towards unpaid rent or hirer-related damage. Any remaining bond is returned to the hirer.
Reasonable steps are also taken to recover amounts that exceed the bond.
Revenue and Expenses Are Administered Through the Pool
Managed Pool Revenue can include:
Expenses deducted before Monthly Income is calculated can include:
Amounts recovered from hirers for damage are credited against relevant pool expenses.
Receive Monthly Income and Reporting
Your Monthly Income is calculated from your proportionate share of Managed Pool Revenue, less Managed Pool Expenses and expenses relating specifically to your cabins.
Monthly Income is normally transferred to your nominated bank account on the seventh business day of the following month.
You also receive a monthly statement showing items such as:
Monthly Income may be deferred if there are insufficient funds available in the Managed Pool Trust Account to make payments to all owners. In this situation, owners must be treated equitably and the deferred income paid as soon as reasonably possible.
Insurance and Risk Management
As the cabin owner, you retain the risks associated with your asset while it is in the possession of third-party hirers.
You are required to maintain cabin insurance through the approved insurer. This cover is linked with the public liability and cabin transport insurance maintained by the Management Company.
Full details of the applicable insurance cover can be provided before you enter the agreement.
Independent Annual Audit
Once every 12 months, the Management Company engages a suitably qualified and experienced external auditor to audit the managed pool’s annual financial statements.
A copy of the auditor’s report is made available to cabin owners.
Selling or Removing Your Cabin
The Cabin Management Agreement provides several options for selling or removing cabins from the managed pool.
An owner may request the removal of one cabin for personal or family use. The cabin removed must generally be the owner’s oldest cabin of that particular model.
Cabins may also be offered for sale to other managed pool owners, offered to the Management Company or sold to another buyer. A third-party buyer must enter into a Cabin Management Agreement if the cabin is to remain within the managed pool.
Because a cabin may be with a hirer when removal is requested, it will not necessarily be available immediately. Physical collection generally occurs only after the existing hire agreement has ended and the cabin has been returned.
The full process, notice periods and conditions are set out in the Cabin Management Agreement.
