Almost a fifth of Bristol’s commercial buildings could be deemed unlettable from April 2018, unless they comply with Minimum Energy Efficiency Standards (MEES) which passed through Parliament in March this year, announced recently by The Department of Energy and Climate Change (DECC).
The UK Green Building Council, together with sponsors Bilfinger GVA and Sweett Group, hosted an event at ARUP’s Bristol offices, to warn property landlords and occupiers of the value and cost implications of the recently announced regulations.
From April 2018, it will be unlawful to let buildings with an F or G EPC rating, impacting on 18 per cent of the 598,512 EPC registered commercial properties in the UK, and 17 per cent of Bristol’s buildings. From 2023, this will extend to include all leases in existence.
Coupled with the UK government’s withdrawal of funding for the ‘Green Deal’, the vehicle to assist financing of energy efficiency improvements to commercial buildings in the UK, there are a number of value and cost factors to consider in complying with the MEES guidelines, such as a potential reduction of rental income, extended void or marketing periods and associated capital costs with installing measures to comply with the regulations.
Jonathan Gibson, Associate, Bilfinger GVA, said: “The MEES regulations are likely to cause problems for at least a fifth of the commercial property market with winners and losers in both landlord and occupier businesses.
“This impact will be particularly prevalent from now in the run up to the implementation date of April 2018 whilst the industry wakes up to the MEES regulations.
“Bilfinger GVA is advising our landlord and occupier clients to begin planning now to address the issues in their portfolio, and to take a collaborative approach to what is in essence a significant opportunity to improve the energy efficiency of the worst performing buildings in England and Wales.”
Whilst there are some concerns over the quality and accuracy of EPCs, particularly those undertaken between 2008 and 2010, there is a common view amongst professionals that it is often straightforward to improve buildings for minimal cost and therefore with negligible impact on value. The risk though is that for some poorly rated buildings, MEES threatens to accelerate obsolescence and impact property values and rent negotiations.
Richard Griffiths, Senior Policy and Business Development Advisor, UK-GBC, summed up the bigger picture. He said: “A few short years ago, no-one would have imagined that the least efficient buildings would soon be made illegal to let. MEES could be a game-changing piece of legislation, and one that other countries around the world will be watching with interest.”
In addition, yesterday, 22 September, 24 hours into World Green Building Week 2015, Bilfinger GVA hosted ‘Sustainable fit-out: The taste test’. The seminar saw a panel of project managers and sustainability assessors explore the different rating schemes within the build environment, SKA and BREEAM, and evaluate their different methods, costs and benefits.
Bilfinger GVA’s HQ at 65 Gresham Street in London hosted the seminar, an apt venue, having recently been awarded a Gold SKA Rating – the highest possible accolade, and one that the company will use to convey the importance of leveraging these schemes within corporate CSR programmes.
Bilfinger GVA’s national Sustainability team is actively involved in finding solutions and implementing services to improve sustainability performance for their clients’ organisations, investments and operations within the real estate industry throughout the UK. The team is also involved with a number of industry bodies, including the UK Green Building Council, Better Buildings Partnership and RICS.
