What we do

Occupiers pay service charges to cover costs of occupying their property that are not included in the rent. In retail buildings like shopping centres, service charges often include things like the costs of lighting and heating the mall, security, waste collection and marketing the shopping centre. In office blocks, the service charges cover things like the costs of lifts, lighting the lobbies and staffing the building's reception desk.

Landlords incur the costs for these services and levy the service charge to recover them, and their own administration costs.

Service charges can represent significant costs for commercial occupiers, so they are normally an obvious target for cost reduction. However, they are part of a contractual agreement, so the occupiers are liable to pay them.

Occupiers have voiced concern that their service charges, and the contribution made by the individual service elements, are not as transparent as they would wish them to be.

In terms of the transparency of service charges, we actively support the Royal Institution of Chartered Surveyors' Service Charge Code.

The code provides the property industry with a clear set of recommendations, which if implemented will reduce the opportunity for disagreement between landlords and occupiers. It provides guidance on best practice for landlords to follow when negotiating new leases with occupiers.

We also agreed a ten point plan with the British Retail Consortium for landlords' dealings with their occupiers.