Who is responsible for HVAC maintenance – FMs or tenants?

23rd May 2023

If not managed correctly, the demarcation of responsibility for repairs and maintenance in commercial buildings is something of a ‘grey area’ – particularly where there are multiple business tenants.

Commercial landlords have a duty to ensure their property is safe for tenants and other users, but if FMs want the tenants to take responsibility it can result in an effective stalemate, with neither side willing to pay and essential maintenance is put on hold. If matters cannot be resolved, legal fees can be costly meanwhile critical HVAC systems may be operating inefficiently, at risk of breakdown and/or posing a danger to occupants.

In the matter of who is responsible, the law can only take us so far. However, FMs and landlords can take action to improve clarity, control and transparency.

What does the law say?

In residential property, rights and responsibilities are clearly defined for the most part, but business property is more ambiguous. This is because there are so many different types of commercial building and uses, it would be impractical to lump them all together for the purposes of the law.

The Health and Safety at Work etc. Act 1974 sets out several tenant responsibilities, including:

  • Compliance with Fire Safety Regulations
  • Temperature, lighting and ventilation control
  • Drinking water
  • Equipment safety
  • Toilet facilities.

Landlords are responsible for health and safety matters in communal areas.

Landlords and tenants are responsible for the maintenance and repair of all the ‘fixtures’ (items attached to the property, for example, HVAC systems) and ‘fittings’ (items that are not a permanent part of building itself, for example, shelves or cabinets) that they own. Structural repairs would usually lie with the landlord, whereas non-structural repairs, for example, air conditioning and plumbing would be the tenant’s responsibility.

It is possible that within this, there is significant potential for misunderstanding and conflict.

Therefore, it is essential that commercial landlords seek advice from a specialist commercial property lawyer who will ensure that all rights and responsibilities are set out clearly in the Lease Agreement.

Lease Agreement

FMs and landlords should consider which of the following options best suits their building and its use, which will form the starting point for the Lease Agreement:

  • Landlord takes full responsibility for HVAC system – this situation can be written so that the landlord can pass on any costs to the tenants through a regular service charge or maintenance fee.
  • Tenant takes full responsibility for HVAC system – this may be a suitable option if each rental unit has its own HVAC system. However, it could put landlords at a disadvantage at the end of a tenancy if proper maintenance has been neglected.
  • Shared responsibility for HVAC system – rights and responsibilities clearly defined in Lease Agreement.

HVAC closed systems monitoring for control and transparency

Alongside a watertight Lease Agreement, remote HVAC monitoring technology can pin-point accountability and help FMs to avoid costly litigation for issues they did not cause.

In one example, we worked on a building where unnecessary interventions and a lack of maintenance on behalf of the tenant resulted in remediation works to the cost of £300,000 – a bill which could easily have landed in the building operator’s lap.

However, Hevasure’s real-time corrosion monitoring system had been installed in the building; a technology that monitors corrosion indicators, water condition and system integrity, including dosing levels, unplanned events such as water loss, pressure and temperature every 15 minutes, 24/7.

Using data collected from the Hevasure unit, the tenant was found to be at fault and the cost of remediation work passed on. In this case, the cost of the Hevasure unit was £2,500 per year – resulting in significant savings for the building owner.

Knowledge is power

Essential building services are incredibly complex and their maintenance and repair involves many parties – from landlords and FMs, to contractors and tenants.

For landlords and FMs, control and transparency is critical. To achieve this, they need have as much data and information as possible about their HVAC systems, typically monitored by a BMS system, however, this platform is only helpful to interrogate the HVAC plant operation and not the loss of building comfort conditions should the closed systems water quality start to deteriorate.

Old-school methods, such as sampling and corrosion coupons, do not cut the mustard in modern buildings alone. Our comprehensive monitoring and maintenance package, BG50i, incorporates real-time corrosion monitoring technology – which identifies when things go wrong – combined with industry-leading water treatment to keep systems efficient and operational.

Are you interested in BG50i for your building? The package is available as a one-off ‘health check’ or for ongoing support.

Contact our team of experts today to discuss your specific requirements.