Internal rents and corporate property management: A study into the use of internal rents in UK corporate organisations
| Type | Report |
|---|---|
| Author(s) | Cock,R. H. |
| Publication year | 1998 |
| Notes | ID: COCK1998; Reviewed March 2001, post publication of the main report. Space Charging, or Internal Rent, remains little studied, The most recent research so far located is this survey (conducted in 1996). 55 members of the Property Managemnt Association responded. 29 charge Internal Rent, 26 do not. Of those who do somewhat surprisingly 7 (26%) believe the system to have little influence on organisational management. Why they hold that view was not investigated. Encouraging release of space was not the primary reason for the use of Internal Rents in any organisation (though was seen as an important secondary benefit and the research instrument only allowed one primary reason to be selected). Precedence was given to calculation of true profits (17), accurate information for occupiers (2) and evaluating return on property assets (2). Rents charged for freehold properties are always an estimate of open market rentsal value. A significant number use the same measure for leasehold, especially if it is higher than a current lease. Of the non users 4 had abandoned internal rents as to bureaucratic or costly for the payback to justify it but the reasoning behind the other 20 not using rents was not probed. The topic remains under researched (c.f. main report). Clearly some organisations do not find the effort worthwhile and perhaps find other means to encourage effective management of space and or property as an asset. Otjhers find charging helps while some who use it do not find it influences managerial actions. Unlike Cock this does not suprise this reviewer, matching as it does our obersvations in other sectors. The hypothesis of a link between culture and the effectiveness or otherwise of space charging / internal rents remains tenable. |
| Relevance to practice | High |
| Ease of application | Relevant to anyone considering Internal Rents |
| Stage of application | Occupancy |
| Evidence base | Moderate |
| Readability | High |
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