Independent Expert Determination on Rent Review
24 June 2025Jun 2025 – On referral, win most, lose a few; fair enough when the third party is someone who knows what he/she is talking about. But it irks when someone doesn’t.
One such today. For no apparent reason, the RICS appointment of an IE was, according to the surveyor’s website, an arbitrator and mediator. As if to make a point, after accepting the appointment, when the parties had no choice and couldn’t object, the person sent the parties a CV which would be impressive for an arbitrator. Why the person accepted the appointment is beyond me.
Not only did the person suggest costs could be decided when the lease clearly states each party is to pay 50%, but also the valuation has been based on the RICS valuation standards definition of market rent even though anyone experienced of rent review for a commercial property knows that the definition of market rent depends upon the lease in question. And as for the costs, it wouldn’t surprise me, inflated through lack of involvement in the market. That and including irrelevant paragraphs in the determination as if to pad and, albeit not obliged to give reasons, the reasons given did not include the most important why the determination. Charging £360 an hour to merely repeat what the parties have said is a rip-off.
In 2010 and again in 2015, the RICS DRS panel service agreement for commercial rent Independent Experts required regular assessment ordinarily at 5 yearly intervals unless triggered, among other things, by adverse feedback or lack of regular market involvement in stated areas of expertise. IEs had to update the DRS on their market involvement every 2.5 years with details of experience. For skills, the expert had to be recognised in the marketplace as actively involved.
In 2024, the criteria for a RICS DRS panel appointment as an IE is seemingly more flexible, allowing presumably for the shortage of IEs with particular skills, experience, and/or geographical areas. The property in question is in London, where I would think no shortage of IEs with experience of shop lettings, but while I’d never heard of this person, which in itself doesn’t matter because at least when checking up, the credentials do not give me cause for concern.
In an era of transparency and accountability, I consider the RICS, with its virtual monopoly of third-party appointment for rent disputes, should re-think. An IE should be required to give reasons for a determination by default, unless both parties object. Costs should be limited to a percentage of the passing rent on a sliding scale commensurate with the. rent. An IE should only be appointed if actively involved with leasing transactions in the same market as the type of property in question.
I am going to do something I’ve never done before, and that is to make a formal complaint to the President of the RICS and the RICS DRS that this person should never be appointed as an IE again. In my opinion, the RICS DRS has made a terrible mistake in allowing this person to be an IE. The sooner nipped in the bud, the better.
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