- Published: 28 January 2009 13:15
- Author: Jennifer Creevy
Landlords are reducing service charge at Meadowhall shopping centre in Sheffield
Landlords British Land and Land Securities are trialling a reduction in service charge at two of their shopping centres in the north of England.
The landlords are reducing service charge at Meadowhall shopping centre in Sheffield and White Rose shopping centre in Leeds.
The move comes after discussions between a group of landlords and retailers formed the Landlords and Retailers Working Group, to help each other cope with the deteriorating economic downturn.
Next group property director Andrew Varley said: "We are delighted with the savings that British Land and Land Securities have identified. The Landlord and Retailers Working Group has been very productive in looking at ways to reduce service charges without impacting on customer service levels."
At Meadowhall, cost savings of more than 18 per cent will be made in the first year, rising to 20 per cent in year two, reducing the service charge operational costs by more than £2m per annum, to around £7.75 per sq ft.
At White Rose, a 13 per cent reduction in annual service charge will be implemented, reducing the cost to around £7.25 per sq ft.
Speaking on behalf of the Working Group, British Land director Andrew Jones said: "It is equally beneficial to Landlords and Retailers to keep service charges at realistic and appropriate cost levels regardless of the trading environment. While there is no "one size fits all" solution to reducing shopping centre service charges, by mutually
identifying changes to service requirements and realigning resources to those that add value, we will achieve these savings without impairment to customer service levels."
The British Property Federation welcomed the move. BPF chief executive Liz Peace said: "Our members are deeply aware of the difficulties that many of their tenants are facing, and they are keen to help those in genuine financial difficulty to weather the current economic conditions. This initiative by Land Securities and British Land is a great demonstration of the practical measures they are prepared to take."
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