Portfolio Services
Consultancy Services
Poorly managed services
Poor management meant that our clients owed the landlord £630K in arrears. Property Solutions' in-house experts assessed these costs and significantly reduced our clients' liability.
Description
Our clients held 100% of the area in a modern 11 storey office block in the West End of London.
Issues
The landlord set the service budget at £771k in 2002 for the building and continued to raise invoices at this level until 2004, when these suddenly doubled to around £1.4m. A significant proportion of the figure came from high security costs of £557k and despite this there were security incidents. Cleaning accounted for circa £136k and air conditioning and energy both contributed significantly.
Process
Property Solutions was invited to a tenants' meeting regarding the service charge dispute. The landlord had not certified or audited the accounts since 2002, and when Property Solutions carried out audits we discovered that costs should have been £1.4m since 2002, not £771k. The tenants were advised that they actually owed £630k in arrears.
We compiled a security report and discovered that there were 8 times as many proximity cards issued as the number of people in the building. These cards worked on the doors to tenants’ suites and we recommended a single “fast-track” card reader at the entrance of the building. All cards were terminated and reissued.
We assessed the energy supplier’s bills and discovered that the air conditioning was not being turned off overnight.
In addition our service charge consultant inspected the building’s cleaning records and found that cleaning staff would sign in but not actually be present in the building.
Results
Property Solutions’ expert reports were presented to the landlord.
Security costs were reduced by 48% to £271k and the landlord paid £94k to install fast lanes in the entrance foyer of the building.
In addition the landlord refunded £140k in electricity costs to the tenants, due to the issue of plant running uncontrolled outside of normal working hours.
