English
FrançaisDoes anyone know whether there is an easy way to work out how much rent should be increased in a leaseback arrangement. I believe the percentage is taken from the 'INSEE' website but how do I calculate what the uplift should be?
The Domaine de Figuiere leaseback is nearly 3 years old and we are due an uplift in January and whilst I'm sure Eurogroup will calculate it fairly (?) it would be good to check it myself!
Thanks,
Chris
Comments
chrisr
Indexation of rent
11 October 2008Thanks Noel. Where did you get this information from? I can see the 'rent reference index' of 116.07, with an 'annual variation' of +2.38% for Q2 2008 but not the figures you mention.
Chris
chrisr
Indexation of rent
11 October 2008I think I have worked it out. The index was 102.6 in the 2nd trimestre 2005 and was 116.07 in 2nd trimestre 2008 giving an increase of 13.1%, due on the third anniversary of the start of the rent payments (January in our case).
chrisr
Indexation of rent
14 October 2008Noel, Seamus
Thanks for feedback. I'm still not sure about this calculation and will probably have to wait until January to see what transpires. As far as I can see the increase is not capped and the calculation I have performed is as follows:
Construction index 2nd trimestre 2005 = 102.62
Construction index 2nd trimestre 2008 = 116.07
116.07-102.6 = 13.47
(13.47/102.6) * 100 = 13.1% increase
I'll post a reply when we definitely find out.
Chris
chrisr
Indexation of rent
16 October 2008Noel,
Yes you're right it is the 'l'indice du cout de la construction' that is used. So from the INSEE web site this calculation is....
T2 2005 = 1276
T2 2008 = 1562
1562-1366 = 286
(286/1276) * 100 = 22.4%
I would be amazed but delighted if out rent went up by this amount. This is different to the figure you previously mentione Noel. Also, Seamus you mentioned a figure much smaller - are you using a different calculation?
Thanks,
Chris
chrisr
Indexation of rent
17 October 2008Yes - apologies. I'll let you know if they pay it!
Lomi
Indexation of rent
17 October 2008Seamus, all,
Thanks for generating this thread - as one whose first rent increase is due in April 09 you have suddenly made me take more of an interest in my likely rent increase. I have a leaseback with Maeva/P&V and a lease that reads 'rent will be revised annually in accordance with the national building costs index'. Potentially this could be great but come 1 April but I am slightly concerned it is a little vague.
Do any of you have any experience of this company paying rental increases?
Seamus - I note you always say that you cannot go far wrong with P&V. Do you have any experience of their past record for rental uplifts?
Mel
chrisr
Indexation of rent
23 December 2008I have just received notification from Eurogroup that instead of the 20%+ increase in rent they were due to pay us on our development in St. Maxime they are now proposing a 3% rise every 3 years, i.e. 1% a year.
Has any one had any experience of management companies trying to re-negotiate the contract mid-term? What are our options?
Chris
jaward
Indexation of rent
23 December 2008Hi Chris,
I am dissapointed but not suprised by Eurogroups attemt to renegotiate the insee increase.I havent received my notification yet!.
I will be definatley be resisting this and suggest we take legal advise.
As far as i am concerned this goes to offset the ridiculously high co-op fees which we have had to pay this year(fom the 1/7/08-31/12/08 over 1300 Euros).So much for the "small co-op fees which F.P.sales (now ASSETZ) said that we would have to pay when we bought.
Going forward,with the insee,i think there may have to be some renegotiation,i cant see Eurogroup leaving it open ended!
I also read recently the insee is due a sharp drop!
Regards
John
Brian L
Indexation of rent
31 December 2008Iam glad to hear someone talking of a rent increase. Residhotel asked us to take a cut of 40% at Golf Garden in Levernois and currently revised this to 30% with a threat that if we dont accept they will withdraw from the contract.
So enjoy your discussions about rent increases but be warned you will be lucky to get anything substantial if at all.
jaward
Indexation of rent
31 December 2008Brian L,
We are warned!.But that won't stop us chasing the legally due rent increase that i signed up to 3 years ago.
If you don't fight they will walk all over you!
John
chrisr
Indexation of rent
1 January 2009Given the sky-high rents that Eurogroup charge for renting our apartment I'm sure the Domaine de Figuiere is the 'jewel in the crown' of properties they manage. This makes me even more determined to get them to honour the contract as they must be making a fortune from the development.
Seamus, do you know what happens if the management company tries to unilaterally re-write the contract and we refuse to accept the changes? Given this is a case of 'won't pay' rather than 'can't pay', what re our options?
Chris