Dubai property regulator launches annual service charges list

Rera said that the new index included 300 individual buildings located in 22 major developments including Dubai Marina and Jumeirah Beach Residence, pictured. Razan Alzayani / The National

The Dubai property regulator has compiled a list of annual service charges on hundreds of freehold properties across the emirate.

The Real Estate Regulatory Agency, part of Dubai Land Department (DLD), on Wednesday unveiled its online index at the technology show Gitex.

Rera said that the dirhams per square foot charges provided in the index accessed through the DLD website, was based on information verified by real estate developers and owners’ associations and audited by Rera staff.

The regulatory body, which has been planning to introduce the service charge index since 2012, said that the new index included 300 individual buildings located in 22 major developments including Dubai Marina, Jumeirah Beach Residence, Jumeirah Lakes Towers, International City, Motor City and Silicon Oasis.

“The launch of the Service Charge and Maintenance Index enables landlords and property investors in Dubai to know the service charges and fees that are paid for each project,” said the Rera senior director Mohammed Khalifa bin Hammad.

“In the near future we aim for the index to cover all of the emirate’s urban areas and provide this service to all our customers.”

The index reveals big differences in the service charges applied on developments throughout the emirate – from Dh8.12 per sq ft at Royal Residences at International City to Dh20.88 per sq ft for Grandeur Residences on Palm Jumeirah.

Conflicts between landlords and developers over service charge fees frequently erupt in Dubai with tenants often unwittingly caught in the middle as their landlords refuse to pay for what they say are excessive amounts and developers hold their ground withholding services.

In February, residents of Burj Khalifa, the world’s tallest building, were warned by the developer Emaar that they could be locked out of elevators and car parks and their air conditioning switched off if their landlords did not stump up owing service charge fees.

And two years ago Nakheel drained swimming pools and closed gymnasiums at the Marina Residence on Palm Jumeirah in what tenants said was a dispute over unpaid service charge fees.

“This sort of index could be very useful for anyone looking to purchase a new apartment to help with their due diligence,” said Simon Townsend, the business development manager at DTZ. “Just as you wouldn’t buy a new car without checking out how much it would cost you in running costs and servicing, we would always advise anyone looking to buy to get a clear idea of how much they will be paying in service charges.”

“At the moment, for anyone who has already bought a property there isn’t much they can do about the charges,” Mr Townsend added. “However, it would be interesting to see whether Rera intends to use this as a first step to regulating service charges as it does rents.

“In my opinion to police these rates would be dangerous because it could lead to service charges being forced lower than the cost of maintaining the building which would only lead to poor maintenance and damage to the fabric of the building.”

Follow The National's Business section on Twitter