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Glossary / Property

Chiller free

Chiller free means the cost of district cooling is included in the rent or the service charge rather than billed separately to the occupier, which materially changes what a headline rent is worth.

Cooling is a large running cost in the Gulf. Where it is paid separately, the tenant carries it and the achievable rent is lower. Where it is included, the rent is higher and the owner carries the cost.

Two units advertising the same rent are not offering the same income if one is chiller free and the other is not.

Where people get it wrong

Comparing rents across chiller free and chiller paid units without adjusting. The gap can be several thousand dirhams a year.

The framework behind it Net rental yield sets out the rule, the arithmetic and where it breaks.

Read the framework

Related terms

Service charge A service charge is the annual fee an apartment owner pays the owners association for maintaining shared parts of the building, quoted in Dubai as dirhams per square foot per year and levied whether or not the unit is occupied. Gross rental yield Gross rental yield is annual rent divided by the purchase price, expressed as a percentage, before any running cost or acquisition cost is deducted.

Investments Playbook publishes educational research and general information. Nothing on this site is personal investment advice, a solicitation, or a recommendation to buy or sell any asset. Property and securities can fall in value. Past performance does not predict future returns. Figures shown are indicative and may be delayed. Always take regulated professional advice before acting.