x Abu Dhabi, UAEFriday 28 July 2017

Survey lets residents compare Dubai property service charges

Property owners will soon be able to compare the service charges they pay with an emirate-wide average, following the publication of a survey into benchmark fees that is set to boost transparency in the market.

DUBAI // Property owners will soon be able to compare the service charges they pay with an emirate-wide average, following the publication of a survey into benchmark fees that is set to boost transparency in the market.

In its initial study - which is based on a small sample size - the Middle East Facility Management Association (Mefma) found the average charge for residential towers in Dubai came to Dh13.42 per square foot. About 40 per cent of that covered utilities, including district cooling.

Property owners have long complained that service charges and district cooling are too expensive.

"It's very new that the developers are pushed to be transparent," said Ali al Suwaidi, a Mefma board member. "Mefma is here to try to say, 'Guys, let us open these books and see how to benchmark'."

While the first report was based on a small sample size, subsequent studies would take in a larger research pool. "It will take time before we have the facts," said Mr al Suwaidi.

The average service charge for residential towers was based on 34 respondents. The overall survey, which included commercial, mixed-use, villa and master communities, had 48 respondents. It was conducted by a group of experts over five months and was first presented in January.

The findings will be posted on the Mefma website in coming weeks. Access will be free to members and available at a small fee for non-members, said Sinead Bridgett, Mefma's director of events and membership.

Gathering data was difficult because many developers resisted sharing sensitive information like service fee breakdowns or did not keep close records.

Mefma was set up by Dubai's Real Estate Regulatory Authority (Rera) last August. To boost its sample size, Mefma will ask Rera to make it mandatory for developers to complete the survey.

The focus group also looked at minimum service levels that facility managers must provide, for example, on security guards or waste management.

It also plans to set benchmarks for "reserve funds" collected for long-term costs such as replacing lifts.

"It will help standardisation of service charge calculation, assist in maintaining quality of buildings through minimum service levels and give a broad idea of service charge costing in various markets," Dilip Khatwani, a Mefma board member who led the focus group wrote in an e-mail.

"These issues have long been of concern in the market."

Mefma's other focus groups are looking into areas including energy costs and owners association management.

chuang@thenational.ae