Trading guaranteed volume on 8 turns for a rate concession. Bad trade?

Your $4,900 of lost rent number is the whole deal and it's smaller than I expected. Eight turns at the $8,600 rate versus the $10,100 midpoint is $12,000 of savings, and the schedule reliability is worth another five. So you're chasing seventeen grand and the risk is holding commitments on turns that don't happen.

What's your actual renewal rate? If it's 60 percent then "8 turns over 14 months" isn't 8, it's more like 4 or 5, and you're about to commit to double what you'll need.

What the crew wants is a floor under their week, not a contract. Three man outfit means payroll every Friday whether a flipper's closing moved or not. That's why they bump you. The flipper is the one with a date and a penalty.

Seven day pay is worth real money to them and it may be worth more than the volume commitment. I'd go back and unbundle it. Offer the 7 day terms at $9,200 with a written 30 day scheduling window and a clause that if they bump you, the next turn drops to $8,400. That gives them the cash flow benefit immediately and gives them a reason to hold your date without you committing to units that might not vacate.

@windlass is right to ask about renewals. Also worth knowing whether these three guys are the whole crew or whether they sub the flooring, because if they sub it you're negotiating with someone who doesn't control the thing that slips.

The structure @solder describes is closer to how this usually gets resolved, and the reason is that you and the crew are pricing two different scarcities.

You're treating your volume as the scarce good. In a market where the construction labor shortfall runs somewhere around 349,000 to 456,000 workers by ABC's estimate, a competent three man crew doing turn work is not short on demand. Volume isn't scarce for them. Predictable cash and low-friction work is. That's why the fast payment lever is likely to be worth more per dollar of concession than the eight unit commitment, and why they countered by asking you to take on the vacancy risk. They're happy to trade a rate cut for certainty they don't have to bid.

On the numbers as you've written them: the $410 per week per unit of lost rent implies roughly $1,780 a month rent, so a three week bump costs you about $1,230 per unit, right around seven tenths of a month's rent. Across 12 weeks over 14 months that's your $4,900. The rate spread is larger, $12,000 at the midpoint, so most of what you're buying is price, not schedule. If that's true, the schedule priority clause matters less than you think and you should be less willing to pay for it with a commitment you might not use.

One thing to confirm before you sign anything: a standing arrangement with a specific crew across multiple units can raise questions about worker classification depending on your state and how the relationship is structured. Have an employment attorney in your state look at whatever you write.

This all depends on your renewal rate being high enough that 8 turns is optimistic.

I'd add one diligence item. Ask them what their largest single client is as a share of revenue. If one flipper is 60 percent of their year, you will always be the one who gets bumped and no clause fixes that. If you'd be their second real anchor, the fast pay offer will actually land.

Also @cairn, 7 day payment terms only work if your own reserves can absorb an $8,600 hit before a unit is leased. Check that before you promise it.