News

Archive for March, 2011

At your service

Whilst the present uncertainties in the commercial property letting market are reflected in the continuing grant of short term leases, many of which are on an all inclusive rental basis particularly in the office sector, a new draft code for commercial property service charges was published towards the end of 2010 for consultation within the industry.  Consultation is now closed and we await results to be published by the drafting committee in May of this year with a new Code to be published in the autumn.

Service charges continue to be a thorn in the side of many tenants in the commercial property market and the Occupier Satisfaction Survey for 2010, published by a consortium of bodies, including the British Property Federation, records a dismal 4.2 points out of a possible 10 in respect of service charge arrangements.  19% of occupiers recorded that service charge arrangements had worsened over the 12 months since the last survey with only 4.6% recording an improvement.

The draft Code aims to

  • improve standards and promote best practice, uniformity, fairness and transparency in management and administration of service charges’;
  • ensure timely forecast budgets and year end certificates;
  • reduce the causes of disputes and give guidance re resolving disputes; and
  • provide guidance in the negotiation, drafting, interpretation and operation of leases in accordance with best practice.

Laudable certainly but until the Code’s core principles are adopted as standard by the whole industry, service charges - the spending of tenants’ money by landlords and their agents - will continue to lead to disputes and discontentment.  Hear more by contacting Hatherleigh Training.