Commercial property lease cost savings
There may be potential cost savings in commercial property leases. Photo by Oleg Magni, Pexels.

For commercially leased properties, there could be some savings on the outgoings to consider, starting with the costs associated with the backflow device testing.

Businesses that occupy warehouses or commercial buildings could be required to test the backflow devices on the property that they occupy to ensure the water remains clean and safe for all West Australians.

The annual backflow test is part of the operating expenses within the management of the building and tenancy. By doing the test and submitting it to the Water Corporation, we ensure that our drinking water does not contaminate. When a property has a registered backflow device, the occupant or property owner must submit an online report to the water corporation using a licensed plumber to carry out and prepare the report.

Sometimes, however, businesses might be in a position to apply for an exemption for the requirement to submit these annual reports by requesting a reduced risk level. To find out if this applies to your business, you should contact the Water Corporation or your plumber and see what your options are.

Another way is to source your own maintenance contractors. Some owners or managing agents like to control the facility management, others are open to negotiating, and some leave this entirely up to you. Owning the process might allow the occupant to control the costs.

Finally, there are statutory outgoings. Some businesses have the option to apply for a discount to the council rates. For example, a not for profit organisation might pay less as they are exempt from paying the full amount.

I encourage lessees to challenge the status quo once they commence occupying a building as in commercial real estate each lease, construction, business, situation, terms and conditions are different. What might have applied to the previous occupier might not apply to you.

In my next article, I will share my experience of an SAT mediation session, where I recently assisted my clients.

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