ICSC calls for more transparency on service charges

The International Council of Shopping Centers (ICSC) has called for more transparency in relation to service charges at European shopping centres.

Authors of a landmark guide on shopping centre service charges across Europe, the first of its kind, have said there is a need for clearer dialogue between landlords, tenants and property managers. In addition there is a need for certification of management companies to drastically improve transparency in resource management, they say.

The guide, written by the ICSC retail asset management committee was launched during the fourth ICSC Romanian retail real estate conference on 28 September at the Radisson Blu Hotel, Bucharest.

Martyn Chase, chairman of the ICSC retail asset management committee and a director of DTZ, said: 'Transparency in the management of services charges is essential, especially as the majority of developers and shopping centre management companies, as well as increasing numbers of retailers, operate cross border'.

'Larger operators have clear service charge guidelines understood and respected by their management and tenants,' he said. 'However the service charge schedule of some, often smaller, operators across Europe may not be so clear and our research showed that there is a great disparity in process and management models across Europe. This guide, written by the shopping centre industry for the industry, will help clarify an issue which has always caused debate between landlords and tenants.'

Research for the guide was drawn from shopping centres in 27 countries across Europe. Shopping centre management companies that participated contributed information on every aspect of their service charge policies including waste, insurance, energy, accounting, marketing and sustainability.

One of the main authors of the report, António Matias Lopes of Multi Mall Management said: 'Clear and objective dialogue between all those involved in the business - tenants, landlords and property managers - is essential for clarifying transparency in resource management for services charges, leaving no doubt amongst any of the parties where responsibility and financial commitment lies.'

The service charges report can be read by clicking on the link below or going to http://www.icsc.org/web/EuropeanServiceChargeGuide.pdf