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Thu 30 Dec 2010 01:00 AM

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Service charges? Enough said

This month, I discovered that the debate surrounding service charges rages on and FMs want to see penalties against landlords who do not pay their fees.

Service charges? Enough said

This month, I discovered that the debate surrounding service
charges rages on and FMs want to see penalties against landlords who do not pay
their fees.

The service charge fee is important because it covers all expenses
relating to the operation and maintenance of the common areas of a residential/commercial
building.

According to RERA (The Real Estate Regulatory Authority) the
master developer or sub developer has to pay the service charge on all unsold units.
Failure to do so is violation of the law and may result in civil penalties.

It is only the Owners Association (OA) who has the right to take
action against unit owners and this remains even if an owner tries to transfer ownership
of a unit to another person.

The problem is, there is a fresh supply of developments entering
the market each month and hardly any interested buyers. Ultimately, it is the service
providers who suffer as a result of non payment of fees as they struggle to make
ends meet and services decline.

On the plus side, MEFMA (The Middle East Facilities Management
Association) is trying to do something to reflect industry point of view and has
set up a focus group to put forward recommended Owner Association manager FM related
strategy, which will be disclosed next year.

We have also spoken to a number of people in the FM industry
to get their comments about service charges. You too can register your thoughts
online on our website
www.constructionweekonline.com.

Jennifer Eagle is the deputy editor of Facilities Management Middle East.

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