Do Your Due Diligence

Please remember that the service charge budget is a fallible document. If you inherit a service charge budget from a colleague or another company you should conduct your own due diligence on it. First and foremost this should always be – is it in line with the lease? Do not expect any other property manager to have got it right, it is your responsibility to check.

You should always bear in mind that the service charge budget is an estimate. Yes, you should use your knowledge to make that estimate both reasonable and realistic, but no property manager can predict the future and therefore, at any moment, even the most detailed and prepared service charge budgets can fail. Your duty, as a property manager, is to ensure that the building is maintained and kept compliant in line with the terms of the lease. This will, from time to time, mean you will need to exceed the budget. There is nothing wrong with this, however, how you communicate this to your customers is key.