The minds of Mick Jagger and Keith Richards were undoubtedly on things other than the property market when they wrote ‘(I Can’t Get No) Satisfaction’ in 1965. But their cry of frustration could just as well express the mindset of property occupiers half a century later. . That was my clear take-away from the launch of the 2011 Occupier Satisfaction Survey in London last week.
Five years on from its launch, the survey, conducted by GVA and sponsored by the Property Industry Alliance and CoreNet Global, points to only marginal improvements in occupier satisfaction. Asked to score out of 10 their satisfaction with the solutions and services offered by the supply side, occupiers responded with a mediocre 5.4. Admittedly, it is an improvement on the 4.9 of last year, but it is hardly a glowing reference for the relationship between landlords and tenants. . Furthermore, as the report illustrates, if you’re a small-scale occupier of industrial property the chances are that you’ll be even less satisfied!
So where’s the problem? Service charge processes are one real bone of contention. Occupiers clearly treat service charges with suspicion because landlords often do not provide transparent service charge budgets. Almost a quarter of respondents suggested that either a ‘minority’ or ‘none’ of their landlords had not done so. This is of course contrary to RICS guidelines on transparency and leaves many occupiers with a view that landlords are appropriating service charges as a source of additional income. It’s an issue that needs to be tackled across the market to improve not just satisfaction but trust.
Unsurprisingly, the rent review process also scored badly. Total satisfaction here is unlikely but some simple actions from the landlord – not least improved communication during the process – could serve to reduce the friction. For example, less formal letters explaining why it is necessary to send out formal legal notices could be sent in advance and rent negotiations should not be left to the last minute.
There is much work to do. Landlords need to understand and act on the increasing desire from occupiers for more environmentally sustainable premises – which, judging by the survey results seems to be something of a blind-spot.
Improvements can and have been made. The survey illustrated greater satisfaction in, for example, the application for consent process and the process of relinquishing a property back to a landlord – something which has been quite commonplace over the last couple of years.
As long as occupiers continue to ask landlords to ‘Gimme Shelter’, there is a need for the latter to be more pro-active in trying to build long-term relationships with their tenants and seek to address their key areas of concern. After all, ‘You can’t always get what you want’ is not a strong basis on which to formulate a strong and sustainable relationship with the occupier.