Service Charge

Service Charge

A service charge is a means by which a landlord can recover from tenants the cost of maintaining and repairing a building and providing certain services.

Why it is levied on tenant of multi-tenanted commercial properties are

1. Repairs extending to major structural repairs.
2. General maintenance service including cleaning, refuse collection, lightening, healing, air- conditioning and security commercial service charges forms part of the lease of multi-let commercial buildings such as office blocks, retail developments such as shopping complexes, business, parts and industrial estates.
3. Items which are covered by service change service charges are made up of a number of different items. The main items are listed below not all items will be charged to every home, for example some block do not have left. There is a separate charge for each individual service which can change from year to year, for example your contribution lift repairs.
4. You may be charged for the following services where they apply to your block, it is not intended as an exhaustive list but a general guide.

1. Repair/Replacement and Maintenance to the Block: this covers the cost of labour and materials for carrying out general repairs to the block in which your flat is located.

2. Repairs and maintenance to the Grounds:- this covers the cost of labour and materials for carrying out general repairs to the grounds in which your flats is located, which includes tree and shrub maintenance and fly tipping.

3. Cleaning:- this covers the cleaning of commercial areas windows and refuse contracts where applicable.

4. Energy:- this covers all the electricity used for lightening communal areas and for things such as lifts.

5. Commercial Aerial:- (where applicable) repairs and maintenance of aerials.

6. Lift Maintenance/Repairs:- (where applicable) repair and maintenance of lifts.

7. Door Entry:- (where applicable) repair and maintenance of door entry control systems.

8. Concierge:- this covers the cost of providing the concierge service.

9. Communal heating:- (where applicable) this covers the fuel, repair and maintenance of all parts of the heating systems owned.

11. Management and Administration:- this is cost for managing its leasehold properties it covers the staffing and office cost of our home ownership team and the estate management service that is provide to leaseholder by staff from the housing offices.

12. Ground Rent:- this rent charged to every lease holder. The amount you pay will be in your lease.

13. Major repair and investment work;- this recovers the cost of carrying out major items of repair, replacement and improvement.

14. Fire Extinguishers/Equipment:- maintenance and replacement of safety equipment.

5. How is service charge administered:
Service charges and taxes are time-dependent both have a start date and an end date. Service charge and tax date applicability is based on when the function with which the line item is associated occurred. Because multiple functions can be associated with each order basis, service charge and taxes may be different for different functions on one order.

A service charge specific to a product or service, an administrative is a type of service charge specific to a property.

There are two levels of visibility for service charges as follows:

1. All service charges:- this view is used to manage all service charges for a particular property this would be used by a property revenue manager at a specific property to manage the service charges for the property with which the user is associated.
2. All service charges across properties:- this view is used to manage all service charges for all properties in your organization chain of properties. This view would be used by a corporate property revenue manager to manage service charges for all properties.

 

Recommendations

1. There should be provision for improved and adequate facilities by the property owner and property managers.

2. The management under the direction of its member should investigate any persistent problems with services.

3. The occupants should pay their services charge as at when due to avoid the management company from not running short of money and to facilitate in the up keep of the service in the property.

4. Landlords should be made to repair grounded facilities to avoid breakdown, occupants should be fully enlightened as to what constitute the service charge paid and the benefits of the charge paid.

5. The property managers and occupants should be aware of the different role to play in the service charge administration

6. The landlord should be approached on how to upgraded existing facilities in the property.

CONCLUSION

In conclusion, service charge administration in managing multi-tenanted commercial properties is one aspect of property. Management that should not be overloaded, but should be taken into critical consideration.

References

1. Stapleton, Tim (1906): Estate management practice estate Gazette ltd London.

2. Ratcliff John (1978): an introduction to Urban Land Administration London, the Estate Gazette ltd.

3. Mercy John (1982): Housing management London Estate Gazette Ltd.