Industrial unit management fees

It is generally accepted that tenants in industrial units which are part of a body corporate will pay management fees. Dependent  on the organisation running the body corporate, and how much or how little of a service they provide, those fees will range between very little (very seldom) and around $500 + per unit per annum (mostly).

Yet very often tenants occupying stand alone buildings, irrespective of size, pay no management fees. In general terms  the tenant in the stand alone building  will benefit from lower opex per square metre when compared to a similar sized tenancy in a body corporate, as most often many of the budgeted figures legally imposed on bodies corporate don’t have to apply to a stand alone – so they don’t.

In fact it is the landlord (when the property is landlord managed – rather than managed by a property manager) who absorbs the cost of management.

At Expedio we have recently analysed the costs in self managing properties. The conclusion was that very often we are subsidising tenants, as not only are we able to negotiate better rates than many property managers, but we also don’t charge for the management process.

Accordingly, with new leases we will in future be charging tenants a management fee to cover the time and expense put into managing tenant’s needs. Could agents please ensure they DO NOT cross out the applicable clause in any agreement to lease, and explain to potential tenants that a management fee will be charged?