Buildings that fail to meet new energy performance levels are in danger of becoming obsolete unless landlords and investors act now to improve the energy efficiency of their properties, a Birmingham property expert has warned.
From April 2018, as part of the government’s Energy Act commercial property with an Environmental Performance Certificate (EPC) rating of ‘F’ or below will not be allowed to be marketed for sale or to let.
It is estimated that around 20 per cent of commercial property in the UK have an EPC rating of ‘F’ or below. An estimated 30 per cent of property investors are planning to dispose of or refurbish properties that don’t meet the required energy performance level ahead of the 2018 deadline.
From April 2016, tenants of commercial and residential properties with and ‘F’ or ‘G’ rating will be able to request that their landlord carries out energy performance improvements.
According to Gurdip Chamba, head of Building Consultancy at Bruton Knowles in Birmingham, the move to improve the energy performance of the UK’s property stock poses challenges and opportunities for landlords and tenants alike.
He said: “For landlords, the challenge is to ensure their properties meet the new standard before the new rules kick in and in doing so protect their future income source. Five years may seem like a long time but it is important to start the planning early. Identifying those properties that need attention is the first step.
“There are lots of opportunities to improve the efficiency of a property and generate income. For example, upgrading the glass in the windows and the insulation in the roof and walls to installing energy efficient lighting. For landlords, making these essential improvements will not only have a potential positive impact on values, they will make the property more attractive to occupiers and investors. For tenants, there’s also the added benefit of a reduction in energy costs.
“However, it’s important not to get carried away when making energy efficiency improvements. Any investment made in the property needs to achieve a suitable return.”