St John's Business Estate

Question 1

What does the service charge cover?

Answer 1

1. Planned maintenance such as grounds maintenance, gutter clearance, clean of cladding and roller shutter doors and refuse costs.
2. Reactive maintenance such as external repairs.
   as well as external.
3. There is also a provision for quarterly lift maintenance, however this is allocated specifically to unit 1 as they solely benefit from the service.

Question 2

How are costs apportioned under the service charge?

Answer 2

Based on a floor area matrix

Question 3

What was the cost associated with the installation of the security barrier?

Answer 3

£1,500

Question 4

Was the cost recovered under the service charge?

Answer 4

Yes because it enhanced the security of the estate and therefore provided a benefit to the tenants.

Question 5

Why did you advise your client to remove the trade waste contract?

Answer 5

1. Bins were not being managed properly by the tenants, which was a contravention of core principle 17.
2. There were also complaints because there were some tenants who complained they did not receive a benefit from the service because they did not make use of the bins.
3. So to ensure tenants received a benefit for a service they paid for, I advised my client to provide them with autonomy over trade waste.

Question 6

Did you consult with the tenants prior to withdrawing the trade waste?

Answer 6

Yes - it is a direct requirement under the 6th core principle.

Letters were sent to tenants explaining the benefits and gave them the opportunity to provide any objections / comments they may have.

Question 7

What was their reaction to being made responsible for the trade waste?

Answer 7

Positive reaction - they were in favour, particularly the ones that did not generate much trade waste.

Question 8

How did you advise the tenants the security barrier would be included under the service charge?

Answer 8

Explained the benefits of it to them, and agreed the costs would be split over 4 service charge years.

Question 9

How do you comply with the RICS Service Charge statement in the management of service charges at Bartons Court?

Answer 9

1. Ensure expenditure recovered is in accordance with the lease terms and that no more than 100% of the service costs are being recovered.
2. Ensure service charge budgets and apportionment matrixes are provided annually and at least 1 month in advance of the service charge year.
3. Provide a detailed service charge statement and explanatory commentary annually and within 4 months of the service charge year end.
4. Quarterly letters to tenants on the estate to maintain regular communication on issues and report any variances in the budget.
5. Advise my client to regularly benchmark the costs of services to ensure they are receiving value for money.

Question 10

How do you benchmark costs?

Answer 10

Obtain different quotes

Question 11

Why did you advise your client to outsource the grounds maintenance contract?

Answer 11

1. The quality of the service was not appropriate considering the estate was newly built and it was putting off potential occupiers.
2. My client also had mandatory obligations under the RICS Professional Statement on Service Charges, and the current contract provided a poor service and poor value for money, which frustrated the 2nd and 23rd core principle.

Question 12

Did the new grounds maintenance result in an increased service charge cost to the tenants?

Answer 12

For grounds maintenance as a categorised item yes, however the overall service charge budget reduced because the trade waste contract was withdrawn.

Question 13

What was included in your reports?

Answer 13

1. Description of the estate
2. Details of items in need of repair / maintenance
3. Recommendations