Understanding additional costs for commercial leases: Find out which costs can be passed on, how they are calculated and how you can protect your rights as a tenant.
When renting commercial space in Switzerland, additional costs are a key factor alongside the net rent. They include additional expenses that often make up a significant portion of the total rental costs. A clear understanding and accurate budgeting of these costs are essential for financial planning in order to avoid unexpected expenses. The gross rent, i.e. the actual amount payable, consists of the net rent and the additional costs.
This guide provides an overview of additional costs for commercial properties in Switzerland. It explains the legal basis, which costs may be passed on, how additional costs for commercial properties are calculated and distributed, which factors influence the amount and what rights tenants have.
The Swiss Code of Obligations (CO), in particular Articles 257a and 257b, and the Ordinance on the Rental and Lease of Residential and Commercial Premises (VMWG) form the legal basis.
The decisive factor is that additional costs must only be paid by the tenant if this has been specifically and detailed agreed in the rental agreement. General formulations are not sufficient. If costs are not explicitly listed, they are considered to be included in the net rent.
According to the law, additional costs are the actual expenses incurred by the landlord for services related to the use of the property. These include typical operating costs such as heating, hot water and public charges incurred through use. It is important to distinguish between pure operating costs and costs incurred by the owner as a result of ownership (maintenance, repairs, general administration). The latter are covered by the net rent and may not be charged as additional costs.
Only costs that are directly related to the use of the property and are explicitly agreed in the contract may be charged as additional costs.
Typical permissible additional costs, if agreed in the contract, include heating and hot water costs. This includes fuel, operating electricity for systems, chimney cleaning, service work, tank inspection, consumption measurement and billing costs. Directly attributable administrative expenses are also apportionable. Periodic costs such as boiler servicing can be charged on a pro rata basis annually. Water and sewage costs for actual consumption are also apportionable, but not consumption-independent basic fees or rainwater fees. Operating costs for common areas such as general electricity, building maintenance (for cleaning and simple maintenance work), stairwell cleaning, ongoing garden maintenance and snow clearance can be charged. In the case of lift costs, operating electricity, emergency call charges and maintenance subscriptions are often apportionable, but repairs are not. Basic TV charges are apportionable, but installation costs are not. In the case of administrative costs, only the costs of preparing the service charge statement (usually 2-3% of the net additional costs or according to expenditure) may be charged.
On the other hand, typically non-permissible costs must be borne by the landlord. These include repairs and maintenance, replacement purchases and investments, the amortisation of equipment (with exceptions), general building insurance premiums, non-usage-based public charges (e.g. property tax), development fees, mortgage interest and general administrative fees. In the case of service subscriptions, it must be checked whether they include pure maintenance (apportionable) or also repair costs (non-apportionable).
The following table provides an overview (not exhaustive):
| Expense category | Permissible additional costs | Unacceptable additional costs (typically) |
|---|---|---|
| Heating/hot water | Fuel/energy, operating electricity, chimney sweep, burner service, tank inspection, boiler service (proportionate), consumption measurement, heating insurance, administrative costs for heating/hot water | Repairs, replacements, amortisation (except contracting/ZEV), general building insurance |
| Water/wastewater | Cold water consumption, consumption-based wastewater charges, water treatment chemicals | No consumption-based basic charges, rainwater charges, connection charges |
| Facility Manager/cleaning/grounds | Pay for cleaning/minor maintenance/garden maintenance, cleaning materials, general electricity, lift electricity, lift maintenance (service subscription), rubbish collection, snow clearance, garden maintenance (ongoing) | Pay for repairs/administrative tasks, purchase of equipment/tools, new plantings, tree felling, lift repairs, disposal of bulky waste |
| TV/Communication | Cable network basic fees | Connection fees, installation costs |
| Administration | Costs for preparing the utility bill (approx. 2-3% of the utility costs or according to expenditure) | General administrative fees, costs for handing over the property, rental expenses |
| Miscellaneous | Value added tax on third-party services and NK billing | Property taxes, building insurance, mortgage interest, repairs, investments, amortisation |
If additional costs cannot be allocated directly, they are distributed using a distribution key. Common keys are based on square metres (per sqm), consumption (if meters are available, often the fairest method), rental property (equal shares) or cubic metres. The key specified in the contract must be appropriate. Any changes require a formal amendment to the contract. In mixed-use properties, care must be taken to ensure a fair allocation key that takes into account different consumption patterns (e.g. office vs. restaurant). In the event of vacancy, the landlord bears the proportionate additional costs; there are specific regulations for heating costs.
Types of billing: on account vs. flat rate
Payment on account: Monthly advance payments, annual detailed statement of actual costs with additional payment or refund. This is the most common method, but carries the risk of additional payments.
Flat rate: Fixed monthly amount, no annual statement. Offers budget security, based on the average of the last three years. Tenants can also request information and access to receipts to check the flat rate.
Reliable average values for commercial additional costs per square metre are difficult to find as they vary greatly. Rough guide values from the residential sector (approx. £30-40/m²/year) are only of limited use for commercial properties.
Factors influencing commercial properties:
Type of business: Different energy, water and waste requirements (office vs. production/restaurant).
Building standard and age: Energy efficiency (MINERGIE vs. old building).
Location: Regional price differences.
Service level: Scope of building maintenance, cleaning, etc.
Rental agreement: Definition of apportionable costs.
Recommendation: Focus on calculating the additional costs for the specific property. Ask for old bills or the basis for calculating the flat rate and find out about the condition of the building.
Tenancy law gives you important control options:
Right to a detailed annual statement (for payments on account): Clear, comprehensible, with total costs, distribution key, your share and settlement of advance payments. If anything is unclear, request a more detailed breakdown.
Right to inspect documents: Inspection of original invoices at the landlord's/property management company's premises. You may take notes/photos or make copies (at your own expense). This also applies to flat rates for checking the basis of calculation.
Deadlines: There is no statutory period for objecting to the statement, but a prompt response is recommended. Limitation period for additional claims by the landlord: 5 years. Limitation period for claims by the tenant: 1 year from knowledge, max. 10 years. Usual settlement period for landlords: approx. 6 months after the end of the period.
Procedure in the event of discrepancies: First, submit a written complaint (registered letter) to the landlord. If this does not lead to a solution, the free arbitration board can be called upon.
Careful contract drafting is particularly important in commercial tenancy law:
Precision: Each additional cost item must be listed explicitly and clearly in the contract.
Distribution key: Check whether it is clearly defined and fair (especially in the case of mixed use).
Billing method: Clarify (advance payment/flat rate) whether the advance payment amount is realistic.
Inadmissible costs: Make sure that no maintenance, repair or investment costs are included.
Negotiation: Discuss the scope of the costs, possible upper limits and service levels.
Checklist for tenants:
Before signing the contract: Check the contract carefully and ask the landlord (expected amount, energy efficiency, old bills).
Budgeting: Plan additional costs realistically and allow for a buffer for additional payments (advance payments).
Ongoing monitoring: Check the annual statement (compare with the previous year, plausibility, allocation, advance payments) and request to see receipts if anything is unclear.
Additional costs are a significant cost factor for commercial properties. A clear understanding of the rules and rights is essential. The key lies in a precise rental agreement. Check the additional cost regulations carefully, negotiate if necessary and exercise your rights to transparency and access to receipts. A forward-looking approach to additional costs enables solid budgeting and promotes a fair tenancy.
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