Audit of Service Charges

There are many service charges that come with leasing a property, many of which are not explicitly explained to the tenant. Sometimes these charges are hidden, or wrongly included within other items in the tenant’s invoice. That’s where a tenant advisor comes in, they help tenants complete an audit of service charges and verify that the tenant is paying the right amount.

Below we offer some examples of what tenants need to look out for and explain the importance of auditing service charges on the lease.

Service Charges

Landlords or property managers will very often promote low charges when advertising the property, but tenants often find themselves surprised by the high charges on their invoice – it’s important before signing the lease to know all the charges to avoid unexpectedly high invoices.

A tenant representative will come in to audit these charges analyzing the property’s current building charges in relation to those of comparable properties – those of similar size, location and services. They will then compare the building charges and carry out a detailed analysis of the most important charges. They will look for any unjustified building charges, which should be covered by the owner or another tenant of the property, helping tenants negotiate lower service charges.

Type of charges

There are three types of charges: the common charges between the tenant and landlord; private charges of the tenant; private charges of the landlord. During the control it’s vital to make it clear what charges are paid by the tenant and get a clear distinction between the private and the common charges.

An example of a service charge that the tenant representative will help to analyze is the cost of exiting a lease. The lease document often states that the tenant is obliged to reinstate the premises in the same state before they moved in. If not restored, they will be charged a compensation fee, and these can rise immensely. A tenant representative will negotiate these charges, so that the tenant can be prepared for the cost of moving out and is not surprised by the final bill.

There are a number of similar clauses and charges that the tenant needs to review before signing the lease. Contact our team for more examples of standard charges and tips for tenants specific to you.

At the beginning of October we held our first in-person Global Summit in over two years. The Summit exemplified the global nature of our partnership, as we welcomed representatives of partner firms from around the world, including Australia, Canada, Sweden, UK and the US.

External Speakers

We had the opportunity to hear from an incredible line-up of speakers throughout the three-day summit. Industry leaders, such as Colin Connolly, President and CEO at Cousins and Kent Mason, SVP and Market Officer for Prologis who talked about the international outlook on logistics real estate from a supply and demand perspective.

Director of Talent Acquisition at OneDigital, Robin Malmanger talked about the dramatic shifts in the labour market and what employers can do to ensure they retain people and plan appropriately. While Brad Stevens, Founder & CEO at Outsource Access, presented on ‘Efficiencies in Business Operations and Leveraging to Scale‘.

Round Tables and Panels

Our Exis Global Summit is all about making connections and exchanging knowledge. We heard each of our representatives give a market update on their location and held a round-table on latest developments in the industry and marketing.

Street Jones – Vice President and Principal at Rich Commercial Realty and Exis representative for Raleigh, North Carolina – gave us an overview of how to leverage client reviews to promote the success of your company.

Our Young Professionals Panel welcomed young professionals (YPs) from America, Australia and Europe who led a panel discussion about being a young professional in the industry. They offered their unique perspective from different regions and discussed how to help YPs succeed and how to succeed as a YP in their role and market.

Real Estate Tour

Our Atlanta hosts, Wildmor Advisors, took us on a tour of the Battery – home to Atlanta Braves and a successful two-million-square-foot mixed-use development in Atlanta. The development – in addition to featuring some of the city’s most diverse brands, exciting restaurants and a 4,000 seat music venue – is home to headquarters of TKE and Papa John’s Pizza and regional headquarters for Comcast.

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Overall we had a busy and successful summit, where our partners were able to reconnect in person, share best practices and share ideas on how to leverage the Exis platform to offer an even better service to their clients.

We look forward to welcoming our Exis partner firms at the Global Summit 2023 in Toronto!