The Cost of Getting Facilities Management Wrong

Facilities management is a critical but often overlooked aspect of property management. When mismanaged, it leads to spiralling costs, legal liabilities, safety hazards, and dissatisfied tenants. Many property owners underestimate the true costs of reactive, rather than proactive, maintenance – resulting in substantial financial and reputational damage.

Escalating Maintenance and Repair Costs

Neglecting planned preventative maintenance (PPM) leads to higher long-term costs. Properties that operate on a reactive maintenance model – only addressing issues when they become urgent – end up paying significantly more for repairs.

A small leak, for example, left unattended, can escalate into serious structural damage requiring extensive refurbishment. The cost of proactively servicing HVAC systems, for example, is often five times lower than replacing them after failure.

Legal and Compliance Risks

With stricter building safety and environmental regulations, failing to maintain properties in line with legislation can lead to legal penalties and reputational damage. Key compliance risks include:

• Fire Safety Violations – Properties that do not meet the latest Fire Safety (England) Regulations 2022 may face fines of up to £150,000 per breach.
• Building Safety Act Non-Compliance – For higher-risk buildings (over 18m or seven storeys), the Building Safety Regulator (BSR) now has the power to prosecute landlords and property managers who fail to comply with structural and fire safety regulations.
• Health & Safety Failures – Landlords are legally responsible for ensuring properties are habitable. Neglected gas and electrical systems have led to high-profile cases of carbon monoxide poisoning and tenant injuries, resulting in lawsuits and substantial fines.

Tenant Dissatisfaction and Increased Void Periods

Poor facilities management directly affects tenant retention, rental yields, and long-term occupancy rates. Slow response times for maintenance issues, poorly maintained communal spaces, and security failures all contribute to tenant dissatisfaction.

For build-to-rent developments and high-end residential buildings, tenant experience is now a key differentiator in the market. Buildings that suffer from frequent maintenance issues experience higher tenant turnover and lower renewal rates, leading to revenue losses.

Inefficient Supplier and Contract Management

Many property managers overpay for contracted services due to poor procurement processes, lack of benchmarking, and long-term supplier agreements that do not reflect market value.

• Lack of performance-based contracts can lead to substandard work at premium prices.
• Inadequate service level agreements (SLAs) mean response times for critical maintenance tasks are slow, leading to higher tenant complaints.
• Failure to benchmark costs results in overspending on routine services like cleaning, security, and landscaping.

How to Implement a Proactive Facilities Management Strategy

Move from Reactive to Planned Preventative Maintenance (PPM)

• Establish a regular maintenance schedule for heating, ventilation, air conditioning (HVAC), lifts, and plumbing.
• Conduct quarterly property inspections to identify and address small issues before they escalate.
• Ensure Compliance with Fire and Building Safety Regulations
• Conduct annual fire risk assessments and maintain an up-to-date Golden Thread of safety information.
• Implement digital compliance tracking to ensure all records are properly maintained.
• Optimise Supplier and Service Contracts
• Regularly review service contracts to ensure value for money.
• Establish performance-based agreements with clear KPIs for response times and quality of work.
• Leverage Technology for Smarter Facilities Management.
• Implement a centralised digital maintenance log to track requests and service responses efficiently.

Tideway provides comprehensive, cost-efficient facilities management solutions that:

• Reduce unexpected costs through proactive maintenance planning.
• Ensure full compliance with UK property laws and safety regulations.
• Improve tenant satisfaction, retention, and long-term rental yields.
• Optimise supplier contracts to reduce overspending and improve service quality.