Maintenance. We know it makes sense. It's like insurance - a no-brainer. Yet, when it comes to property maintenance, there is a fundamental conflict between the needs of the tenant and the objectives of the landlord.

This is hardly surprising. From the landlord's perspective, the building is an investment to be nurtured and protected, but for the tenant, the property lease represents a liability to be used and exploited.

Certainly, the landlord should ensure that the lease provides appropriate protection for his investment, but in reality it's just a contract. The recession has created a difficult business landscape. Very few have escaped the effects of the downturn. Companies need to make tough decisions and property maintenance is unlikely to come out as a high priority when funds are tight - and push comes to shove.

So it makes sense for landlords to be looking at strategies to help redress the balance. The rise in tenant power and the effect of supply and demand has had a downward pressure on rental income, but it is in no-one's interest to see an accompanying slippage in maintenance standards. 

So what should investors be doing to encourage good maintenance and reduce their exposure to unwelcome repair bills?

In the case of FRI leases, every property should have a Programme of Preventative Maintenance with clearly defined accountability and tenant obligations. For each programme to be effective there must be an accompanying governance model with full monitoring procedures and clearly articulated remedial activities.

It's a different model in respect of multi-let environments; where the landlord will be responsible for the maintenance programme. In this case the landlord will pick up the costs for maintenance - and hopefully repair - and apportion them out to the tenants on a pro rata basis. However, the recession has kicked up a challenge where properties are subject to partial occupancy. In this situation, the landlord will become liable for the cost of maintaining the empty parts of the building.

The smart landlord will plan to avoid this situation, by optimising the maintenance schedule - and ad hoc repairs - to coincide with periods of full occupancy. This may not always be possible but it is a desirable planning objective.

When things do go wrong, the objective is to minimise loss by being on the case and in charge of the situation. The overall mantra is "no surprises". There are ways to mitigate losses when tenants default, especially where buildings require significant reinstatement works, but you need to plan for such eventualities and remain in control.

At NB Real Estate we have a great deal of experience and expertise in these matters. We can help you with the preparation of Preventative Maintenance Programmes. We can advise you on procedures to enforce remedial works and help you to implement best practice and avoid unforeseen expensive repairs and reinstatement costs.

So if you want to reduce your exposure to unforeseen costs and ensure that your tenants maintain your investment, why not give me a call. I'm Bob Cooke and you can contact me on 020 7544 2021, or email me at bcooke@nbrealestate.co.uk