The impact of COVID 19 on service charges in commercial properties

This article considers the effect of COVID-19, and the resultant regulations and protective measures that have come into place, on the operation of service charge in commercial properties. The article is in three parts. In the first section, issues in relation to work to common parts and the provision of services are analysed. These issues arise in relation to service charge generally but become especially pertinent in times when commercial tenants are likely to be experiencing cashflow difficulties, with the result that tenants may question and dispute entries in the service charge statement more readily. The second section considers legislative measures that have come into place in response to the pandemic, and examines the effect on the landlord – tenant relationship from a Scots law perspective,i with specific emphasis on the landlord’s ability to recover arrears of service charge. The final section considers non-legislative measures that have a bearing on service charges and their collection in commercial leases.