Transparent Fees & No Commissions
If an agent earns a percentage of what a building spends, it is better off when the building spends more. Declining that income is what makes our advice on whether a job is needed worth anything.
What This Covers
- A fixed management fee, agreed in advance
- No commissions or third-party incentives
- Client money ring-fenced per property, never pooled
- Additional services priced in a published list, inclusive of VAT
- The first arrears reminder issued without charge
One Fee, Agreed in Advance
The management fee is the amount payable to us for managing and administering the development. It is agreed with our client and is typically set as a fixed annual amount, which means it appears as an identifiable line in the service charge budget rather than as a moving figure.
It is one element of the service charge, not the whole of it. The service charge is the total collected to run the development, and it also covers maintenance, utilities, insurance, cleaning, landscaping and statutory compliance. Separating the two is the first thing a leaseholder needs in order to judge whether a budget is reasonable.
Why We Refuse Commissions
We do not accept commissions or third-party incentives, and we do not charge administration or commission fees on contractor selection or as a percentage of contractor invoices for general maintenance.
Commission arrangements are widespread in block management and the problem with them is structural rather than a matter of good intentions. If an agent earns a percentage of what a building spends, the agent is financially better off when the building spends more, which is precisely the opposite of the incentive a leaseholder is paying for. Declining that income is what makes our advice on whether work is necessary worth anything.
Where we are not authorised to act, we say so. Insurance broking is an FCA-regulated activity that we are not registered to advise on. We work with a number of brokers to obtain competitive cover and service, and our insurance disclaimer sets out that position in full.
Where Your Money Is Held
Client funds are held in named, designated client accounts provided by Lloyds Bank Plc. Each account is in the name of the management company, and we operate individual client accounts for each property we manage rather than pooling money across developments.
The accounts are interest-bearing and the client keeps all of the interest. Ring-fencing at this level is what allows a director to see the position of their own building's money without it being entangled with anybody else's.
- Named, designated client accounts with Lloyds Bank Plc
- An individual client account per managed property
- Accounts held in the name of the management company
- Interest-bearing, with all interest retained by the client
What Sits Outside the Management Fee
Some work falls outside day-to-day management and is charged separately, including conveyancing and sales packs, consents and licences, Right to Manage claim packs, Section 20 administration and company secretarial services. Those charges are published in our Additional Services price list rather than quoted case by case, and all fees in it are inclusive of VAT.
On arrears, the first payment reminder is issued without charge, and the cost of preparing and issuing invoices along with that first reminder is included within the agreed management fee. Where further reminders or correspondence are needed, the reasonable costs are applied to the individual account concerned rather than to the service charge, so residents who pay on time are not funding the administration caused by accounts that do not.
Common Questions
What Is a Management Fee, and How Does It Differ from the Service Charge?
The management fee is the fee payable to the managing agent for professional management and administration of the development, and it forms one part of the overall service charge. The service charge is the total collected to meet the cost of managing, maintaining, repairing and operating the development, alongside maintenance, utilities, insurance, cleaning, landscaping and statutory compliance.
Why Does PBM Apply Administration Charges for Payment Chasing?
The cost of preparing and issuing invoices along with a first reminder is included within the agreed management fee, and that first reminder is issued without charge. Where further reminders or correspondence are required, the reasonable costs are applied directly to the account concerned, because they relate to an individual account rather than to the management of the wider development.
Related Services
Financial Management & Reporting
The budget is prepared before the year starts and apportioned according to the lease, not by any rule of ours. At year…
Read moreAdditional Services
Sales packs, consents, licences and more, with a published price list.
Read moreHelp & Resources
Guides for residents and clients at every stage.
Read morePolicies & Procedures
Every governance document, available to download.
Read more