The Royal Institution of Chartered Surveyors is to take action on tackling potential conflicts of interest in the property industry when agents advise on both sides of a transaction.
It is in the process of reviewing its regulations on the issue. The regulatory body has been prompted into broaching the thorny subject by growing evidence of the scale of potential conflict as the agency world continues to consolidate.
The University of Leeds announced it had launched a research project earlier this summer on conflicts of interest in commercial property.
More than 1.2m sq ft of office lettings in central London last year involved agents which represented both the landlord and the prospective tenant, an analysis by the university and tenant representation specialist DeVono found.
The review of RICS policy is expected to include investment advisory work and tenant and landlord representation.
The RICS has recently updated guidance on its website about conflicts of interest, clarifying that they may occur when “advising both the seller and buyer of a single commercial property” as an example.
A RICS spokesman said: “RICS is reviewing its regulations around conflict of interest and we are expecting to make an announcement in the coming weeks.”
DeVono managing director Adam Landau said the review was “long overdue”.
He added: “It is about time that the RICS dealt with this issue. Occupiers have effectively been second-rate citizens and they are the ones that suffer as a result of this double-dipping. RICS has lost control of it.”
The Investment Property Forum last year published its own guidance on conflicts of interest which, while widely endorsed by agents, is non-binding. Should the RICS guidance be updated in the Red Book it would become compulsory for members.
