Retail property owners and investors are ramping up asset management strategies to maintain shopping centres performance in a difficult economic environment across Europe, but costs continue to be a big concern for centre management and their tenants.

Retail property owners and investors are ramping up asset management strategies to maintain shopping centres performance in a difficult economic environment across Europe, but costs continue to be a big concern for centre management and their tenants.

Rent and service charges have always been an issue between landlords and tenants, but managing director of retailer Douglas, Hubert Stech, now says that in some cases the high cost of energy constitute 'a third rent'.

Speaking at the International Council of Shopping Centers' (ICSC) first Retail Asset Management Conference, held in conjunction with the Polish Council of Shopping Centres (PRCH) in Warsaw last week, he said: 'The cost of energy will dictate whether or not older, less sustainable centres, will continue to attract high calibre tenants. For us, paying for energy is like a third rent [with the service charge being the second]. We will not go into older centres where the landlord has failed to improve the centre’s sustainability and reduce energy costs - it just doesn’t make sense for us.'

Douglas now trades in 23 countries across Europe. In Germany, 37% of its shops are in shopping centres, in other countries 55% are in shopping centres.

Also speaking at the conference Hermann Cengiz, Head of Retail Real Estate Asset Management at Commerz Real, who is also on the ICSC Retail Asset Management Committee, announced that ICSC is about to undertake a service charge survey amongst European developers during the summer.

'Across Europe there is no consistency in what service charges cover,' he said. 'The survey analysing service charges across Europe is long overdue and I look forward to being able to report back in October this year.'