Chilled Water Rate Audits
A Chelepis audit determined that $100k+ in a tenant’s annual chilled water billings were erroneously based upon $4k in actual costs. After the audit, Landlord completely discontinued its practice of direct billing the tenant for chilled water.
In recent years, there’s been a rising trend among owners and landlords to bill tenants for chilled water outside of the normal operating expense recovery pool. The stated intent of this direct billing arrangement is to more accurately capture the costs of the chilled water service and reimburse landlord accordingly. However, we find this arrangement can often lead to overbilling as it creates an opportunity for a new profit center for landlords and owners.
A chilled water rate audit begins with a review of your landlord’s billings for chilled water. The billing records may reveal the pertinent equipment information, but usually, if not always, the audit should include a site tour. On the tour, we observe the building’s chilled water metering equipment and verify the actual equipment used to provide the building’s chilled water supply.
After reviewing the underlying invoices, billing, and site tour observations, we can prepare a cost analysis. The reporting can include the actual cost to provide chilled water, tenant’s usage of chilled water, billing or metering issues, and potential or expected recovery. The cost analysis report is distributed to both tenant and landlord, during which time, Chelepis manages the resolution process with the landlord. Our success at settling claims comes from the experience and expertise of our team. The Chelepis approach is a complete process managed from beginning to end by an experienced staff that has audited millions of square feet of leased space throughout the country.