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Planned Preventative Maintenance models to keep buildings fit-for-purpose

wantspacegotspace.co.uk - Planned Preventative Maintenance models to keep buildings fit-for-purposeNational commercial property consultancy Lambert Smith Hampton has called for landlords and occupiers to work together and adopt planned preventative maintenance (PPM) models to ensure commercial properties stay fit-for-purpose.
 
Research by LSH showed that some 27% of office stock in England is physically or functionally obsolete, while the British Council for Offices found that some 40% of office stock has suffered from little or no capital expenditure in the past 15 years.
 
Ben Hooker, director of property management at LSH, said: “Many of the UK’s commercial buildings are heading prematurely towards end-of-life. This is in part due to legislation but also the effects of longer-term leases expiring.
 
“This can be avoided by adopting a well thought through PPM backed up, and financed through, a sinking fund mechanism in the service charge. This would benefit the needs of landlord and occupier, ensuring the building remains fit for purpose to an occupier and upholding the capital value for the investor.”
 
Important and necessary capital expenditure was traditionally financed through sinking charges but fell out of favour. LSH believes that there is now a clear place for them when they are in support of a defined PPM rather than a mechanism to accumulate funds for unspecified works.
 
Ben added: “An agreed and funded PPM offers transparency, better cash flow management and better service outcomes for occupiers, while providing an element of insurance to the landlord against occupier risk. It is a better model for a long-term and harmonious relationship between landlord and occupier.”

Posted by The Editor (wantspacegotspace) on 30th September 2013

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