Challenges Facing Landlords Today
16 May 2023, by Verity Editor
16 May 2023, by Verity Editor
Being interviewed this month by Verity Director Simon Dresdner, is Israel Weltscher of Carlton Park Management. This interview looks at some of the common challenges facing Landlords today, and how to resolve them.
SD: Landlords are facing a big struggle today, whether it’s blue-chip tenants going in to Administration or the general decline on the High Street. Can you share 3 tips to help Landlords avoid these struggles as much as possible?
1. Struggling with slow paying tenants or chasing large rent arrears? Aggressive actions or knee jerked reactions such as forfeiting the lease, or changing locks, can in some cases backfire and become a bigger financial liability on the Landlords. Get advice before you do anything drastic.
2. With many large national retailers going into administration and becoming insolvent, don’t overestimate your tenants financial standing. Always act right away upon discovering a tenant’s disrepair. Don’t leave dilapidations claims until the end of the lease. Once they become insolvent there is no going back, and all you end up with is a vacant building with hundreds of thousands of pounds in unclaimable cost.
3. Commercial Auctions – though fascinating to watch, and exciting to sell, are not suitable for every investment. Think what happens when your investment does not sell! To the punters who have been watching, an unsold property is like an old fish lying at the fishmonger’s – if it can’t sell, it starts to smell, and buyers can’t help but be suspicious about why it hasn’t already been snapped up yet. Questions start arising, such as are there underlying issues, or is something wrong with the investment? consider whether it’s the right place to sell your property.
SD: Commercial Property Management is a big word. Tell us what you do to help Landlords and which problems you solve for them?
IW: We are very persistent when it comes to collecting commercial rent or service charges and have successfully collected very old debts when others had long given up. We will challenge breach of tenant’s covenant, including dilapidation thereby minimising any loss to the Landlord. As part of our role we always ensure the property is fully Health and Safety compliant so that there is no risk to the Landlord.
SD: Everyone likes a success story; can you share one with us?
IW: We were recently approached to manage a large office park. On the face of it, it all seemed fine, until we received the handover files from the previous managing agents. There were tens of thousands of pounds of service charge arrears from both tenants in occupation as well as from tenants who have long vacated. The results: for years, the landlords kept plugging up the black hole to allow for the services and maintenance plans to continue. Basic H&S and fire regulations had not been taken care of for years leaving the Landlords exposed to various potentials claims. We took on the management and within 6 month we pursued every outstanding debt, not only did we manage to return most of what our client had laid out over the years, but they no longer have to fill any holes and the property is now generating a return on their investment.
SD: What do you do different that makes you stand out?
IW: Our philosophy in management is being proactive not reactive. Having a close relationship with our clients and a constant open channel with their tenants gives us the upper hand in dealing with small issues before they turn into a crisis. This leaves us with a happy client and a healthy investment. Communication is the key to a successful relationship and we communicate very well!
Israel Weltscher is the Founding Director of Carlton Park Management and manages commercial property across the UK.
Carlton Park Management is a multidisciplinary company dealing with every day to day aspect of commercial property management from rent collections to resolving tenant-landlord disputes. With over 20 years’ experience in property Management and a good understanding of commercial law, we advise and deal with challenges before they become serious issues. We specialise in the management of multi-let office parks and industrials estates, where contentious service charge cost and maintenance plans can be a challenge. With our in-house proactive team, we are able advise on an action plan and solve any likely disputes that can arise.
Verity (especially Jozef) have been extremely helpful from the start and will chase you (only if you ask) until it’s all in place! Couldn’t have asked for a better service.