International Total Occupancy Cost Code - IPD

2.7 Plant and machinery
Costs for plant or machinery should be
excluded, where these are part of
production and logistics processes (or
servicing such plant & machinery). To
include production plant, in certain
circumstances, would inflate the cost
base considerably. For example, specialist
production plant such as assembly lines
should be excluded whereas a boiler
plant that provides heating to the building
should be included.
2.8 Unitary charge
Consolidated unitary charges are
increasingly made for accommodation
and accommodation services. These
charges will often be applied to a ‘total’
real estate or facilities services package.
The following are examples:
• Serviced offices where a package of
core services is included within the
core price paid (normally per
workstation).
• Major property outsourcing where,
under a long term contract, buildings
are provided to the occupying
organisation. In addition, services may
be bundled (like serviced offices) into
the contract amount. In this case it
becomes impossible to disaggregate
the costs.
• Buildings where gross rents are
payable including some services such
as any listed under heading C or D. For
instance, in Sweden water, heating,
electricity, structural repairs and
maintenance are often included in the
rent payable.
Please see Section 6.5 for a further
discussion of property outsourcing.
2.9 Occasional space
The costs of hiring occasional space
procured by the real estate/FM function,
which is not considered to be part of the
estate, should be entered under Category
A7. This will include the hiring of meeting
space and rooms and corporate
“touchdown” deals where staff pay as
they go. Occasional space costs may
either be collected for the estate or
country as a whole or be entered against
a particular building where this is more
appropriate, for example where overflow
space is regularly taken.
Where space is not procured centrally but
is independently procured by the relevant
business unit or department, these costs
should be ignored and treated as a
general business expense.
2.10 Health & Safety
Health and safety is not shown as a
separate category because it is
commonly found as part of many different
expenditure heads. Generally, physical
works should be entered under categories
C3 to C6, with staff costs, for example, a
health and safety manager, being entered
under category E2, Facilities
Management.
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2 Approach
2.11 Expenditure tax
All irrecoverable expenditure or sales tax
(for example, VAT in European Union
countries) should be included as a cost.
All recoverable expenditure tax should be
excluded.
However, for benchmarking purposes it is
desirable to review the cost base
excluding such expenditure or sales tax. It
is therefore best practice to be able to
distinguish the amount attributable to tax
from the direct cost invoiced by the
supplier.
2.12 Improvement and repair
There may be some confusion between
improvement on the one hand and repair
on the other. A common sense approach
is required when deciding whether large
items of expenditure should be repair
(putting something back into good or
acceptable condition) or improvement
(the provision of something new).
2.13 Service charges
ITOCC recommends breaking down
service charge costs where possible so
that the full costs of the building under
each heading can be properly identified.
See Section 7.3 for a mapping of ITOCC
to the RICS Service Charge Code.
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