The landlords’ trade body the British Property Federation has called on its members to keep service charges down for retail tenants.
In a letter to members, BPF president Francis Salway – who is also chief executive of Land Securities – said landlords and their agents should manage service charge costs as carefully as they manage their own cost base when preparing their budgets for next year.
The letter suggests that landlords should price-test contracts, defer non-essential maintenance, review marketing budgets and be more transparent when it comes to insurance premiums.

“There is a feeling that because landlords generally pass service charges straight down to their tenants, they are less assiduous in managing these costs than they would be in managing their own internal cost base,” Salway said in his letter.

The BRC welcomed the move, which is the latest sign that major landlords are attempting to respond to the pressures their retail tenants are under in the increasingly challenging climate.