Despite the title this jotting isn’t anything about recipes or cooking but hopefully may make you think about the opportunity to make savings. On being instructed to manage a property all too often I’ve been assured by the client everything is fine, straightforward, and there’s nothing to worry about. But, on commencement of management this has proven to be far from the case. So, whenever instructed, whatever the property I insist upon undertaking due diligence. In some instances this can take just a couple of days, in others collation of all relevant data and working out how it all fits together can take months.
Due diligence can take many forms. These include tenure, facilities, service charges and financial. It’s the financial aspect I touch upon here. I’m currently undertaking financial due diligence on commercial premises. This has highlighted the landlord hasn’t been reimbursed the insurance premium by the tenant for a number of years. In similar vein the process has identified incorrect billing for water going back many years. How or why this arose is lost due to the passage of time. The outcome is a £750 year on year saving. When reimbursed the landlord should be around £10,000 better-off.
Circumstances such as the above aren’t freak one-offs. Just the other day I was asked about securing reimbursement of a long outstanding insurance premium from a tenant. In this instance it’s only around £200. Just think what you could do with in effect a £200 windfall. And, it’s not just about rent and insurance. There are many opportunities to make savings. For instance, what standing charge do you pay for gas and electricity if you have vacant property? An example from inspecting a property just this morning where I noted maize growing in a gutter. Whilst it may cost to have it removed now how much is the property owner going to save in the long term by reducing the risk of water over-flowing the gutter possibly leading to deterioration of decoration, bargeboards and possibility brickwork?
I could go on to mention a £3,000 annual rates saving. I’m not going to as hopefully the above has left you with the appetite to take the opportunity of seeing and making savings for yourself. If you’re not sure and believe we may be able to assist whether you’re a Landlord or a Tenant by all means contact me for free no-obligation advice. You never know what you might save!
Jeremy’s jottings do not constitute advice on any specific matter. Lawson Commercial recommends you seek professional advice before taking action. No liability can be accepted by us for any action taken or not taken as a result of the jottings.