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The water bill for a large large mixed-use estate isn’t a small line item. It’s the third biggest utility cost after gas and electricity, and it’s the one most property managers haven’t looked at in years.
You can switch suppliers. Landlords and commercial landlords have had that right in England since 2017. Most haven’t used it.
This page covers where landlord water costs actually come from, how commercial landlords and property portfolios move to a new supplier, and the places water quietly disappears without anyone noticing.
- England’s non-household water market opened to competition on 1 April 2017 under the Water Act 2014.
- Around 20 retailers are licensed by Ofwat to supply landlords, commercial landlords and property portfolios.
- Wholesale supply still comes from regional water companies (Thames Water, Severn Trent, Yorkshire Water, and others).
- Commercial landlords contract directly, property portfolios can contract centrally for volume pricing, and independent landlords procure via the landlord.
- Typical secondary-landlord water spend runs £3,000-£10,000 a year; primaries typically £600-£2,000.
- The three biggest savings levers: surface water drainage rebates, meter validation, and tariff reviews.
Why landlords pay more for water than they should
A commercial landlord owning a multi-unit estate or single-let property has water charges that flow in two directions: the landlord pays the retailer, then recharges the tenant via service charge or rent. Both ends of that chain are commonly wrong. Surface water drainage on car parks is the single biggest line item — it’s billed on rateable area, not actual drainage path, and many estates drain partially to soakaways. That alone can be a five-figure historic refund.
Sub-meter readings on multi-tenant buildings rarely match the master meter once you reconcile a year of data. The reconciliation difference, called apportionment loss, is the landlord’s cost — not the tenants’. Worth knowing before signing the next set of FRI leases.
The five places landlords overpay
| Where landlords overpay | Why it matters |
|---|---|
| Surface water drainage on car parks and roofs | Charged on building footprint regardless of actual drainage path. If parts of the estate drain to soakaways, balancing ponds or grass, you’re owed a rebate. |
| Vacant unit billing not stopped on void notification | Standing charges keep accruing on empty units until you formally notify the retailer. Most don’t. |
| Sub-meter accuracy assumed, never validated | Sub-meters drift over 5–7 years. The reconciliation loss between master and sub is invisible until you compare them, and it’s the landlord’s cost. |
| Service charge water recharges on outdated tariffs | If your service charge formula uses the rate from when the lease was signed, it’s probably below market — you’re subsidising tenants without realising. |
| Common parts billed under wrong category | Cleaners’ cupboards, plant rooms and entrance halls can end up on a commercial supply tariff when they should be common-parts. |
Can commercial landlords and property investors switch water supplier?
Yes, and the mechanism is different depending on who’s signing the contract.
An commercial landlord is its own legal entity, so it can enter a water contract directly — no council approval needed. Property portfolios (property portfolios) can contract centrally for every landlord in the trust, which usually unlocks better volume pricing. Maintained landlords sit inside the group procurement, so switching is done through the landlord rather than the individual landlord.
The 12 retailers below are all licensed by Ofwat to supply non-household water in England. Pricing, service, and landlord-sector experience vary — most trusts shortlist three and go to a simple comparison exercise.
Routes to procurement
Three ways operators in this sector typically bring a new water contract in. Each comes with its own trade-off between control, effort and how sharp the price lands.
Landlords water FAQs
Can a landlord switch water supplier if tenants pay the bill via service charge?
Yes. The contract sits with whoever signs it — usually the landlord. Recharging tenants via service charge doesn’t affect the landlord’s right to choose the retailer. In fact a sharper rate flows straight to lower service charge increases, which tenants notice.
How does surface water drainage actually get refunded?
You commission a drainage survey showing where rainwater goes — soakaways, ponds, grass, or public sewer. The retailer recalculates the surface drainage charge based on what actually drains to sewer, and refunds the difference up to six years back.
What happens to water billing when a unit goes vacant?
You should notify the retailer the day a tenant vacates. Standing charges continue otherwise. We see vacant units billed for 8–14 months on average before notification gets logged.
Should I install sub-meters on every unit, or stay on apportionment?
Sub-meters cost £400–£800 per unit installed and are usually worth it on units consuming over 100m³ a year. Below that, apportionment is cheaper to administer.
How do I deal with the master-vs-sub reconciliation gap?
It’s the landlord’s cost line, not the tenants’. Some landlords build a 5–10% apportionment buffer into the service charge formula; others absorb it. Best practice is to validate sub-meters every 5 years.
How much does a typical commercial landlord save by switching?
A single-unit commercial landlord typically saves £400–£900 a year. A multi-tenant building saves £900–£1,500. A property portfolio saves £2,000–£5,000 a year — and that’s before any historic drainage refunds.
How do I get the audit started?
Send the most recent 12 months of water invoices for one representative property. We run the audit at our cost and only invoice on contingent recovered savings.
