CONTROVERSIAL FEES THAT were added on to renters’ bills by charging them for use of the common areas of their buildings have been dropped in more than 50 apartments by the country’s largest private landlord.

The so-called common area charges ranged from an extra €150 to €200 every month for new tenants, and would have amounted to €1,800-2,500 extra each year for renters.

Ires Reit said it has “ceased” the charges and “repaid all new tenants” in 56 apartments affected on foot of new legal advice arising from a recent court ruling.

It comes after the landlord had faced pressure in recent months from the rental regulator. The Residential Tenancies Board (RTB) had written to the company over the practice following reporting on the charges by The Journal.

With up to 3,700 apartments in Dublin alone, Ires Reit is by far the biggest player in the capital’s private rental market as well as being the largest in the country. It reported revenue of €85 million for last year.

The attempts by Ires Reit to impose the fees had sparked concern across the sector, with some tenant advocates fearing that renters may feel they had no other option but to sign up for a deal that included the fees. 

The company’s decision was taken on foot of a High Court decision in January that found that only a management company has responsibility for a building’s common areas.

Therefore, Ires Reit said its legal advice specifically affects buildings where there is no management company overseeing the property and the company itself has responsibility for the common areas.

A management company maintains the property on behalf of the owner, carrying out general upkeep and other services. Their cost to the renter per year can range from hundreds to thousands of euro depending on the property. 

Common areas 

The issue first came to light earlier this year after Ires Reit agreed during mediation with the RTB to stop trying to charge a tenant €150 monthly for the common area of a Drumcondra apartment block.

When the charge was initially issued, it was appealed by the tenant who argued that it was an attempt to increase their rent outside of Rental Pressure Zone (RPZ) rules. RPZ regulations prohibit an increase of rent by more than 2% annually. In a statement issued this week, a spokesperson for Ires Reit said that the landlord takes its responsibilities over how rents are set “very seriously”, particularly in an RPZ.

In the wake of the decision over that single renter earlier this year, Ires Reit later sought to apply the charge to new tenants at the same block, prompting further criticism.

Based on the clarifications in the High Court case, Ires Reit said this week it had ceased the introduction of the common area charge and “repaid all new tenants to whom this charge had been levied” in developments where there was no management company operating. 

This affected a “total of 56 tenants across a small number of properties,” the spokesperson for the landlord told The Journal.

The company had previously taken legal advice to ensure the common area charges were “not at odds” with the RPZ rules and adhered to existing legislation.

It said the common area charges and a tenant’s rent were “broken down transparently” in lease agreements. 

“We had introduced the charge on new leases to recoup a portion of the maintenance costs associated with communal areas within the building,” the spokesperson added.

When contacted for comment on the outcome of its talks with Ires Reit, the Residential Tenancies Board said it does not comment on the outcome of “individual compliance interventions”. It said it treats all reports of potential non-compliance with rental law and RPZ rules with the utmost concern.

Political reaction

Labour Party housing spokesperson Conor Sheehan said that that it was “absolutely disgraceful” of Ires Reit to attempt to apply the charges to dozens of renters.

The TD argued that Ires Reit – which only last week scooped €6.6 for the sale of 16 properties – was doing well financially thanks to “eye-watering” rents, but was still “looking to make a terrible situation worse” for renters.

Sheehan added that there needs to be a “definition of rent” in legislation to prevent similar situations happening in future, describing Ireland’s protections for renters as “some of the weakest” in Europe.

“They were looking for this additional charge and you had absolutely no choice, effectively, but to pay them, because there’s so little supply there,” Sheehan said.