By Simon Parsons
Berrys
WHILE the topic of Minimum Energy Efficiency Standards (MEES) have been well reported in professional service newsletters and property press, I feel that the response is somewhat lacklustre in view of the effective date. By way of a reminder:
* From 1 April 2018 new leases or lease renewals cannot be granted on buildings with an F or G energy rating.
* From 1 April 2023 F or G rated buildings cannot continued to be let on existing leases.
There are buildings that are exempt from MEES regulations, however, the target audience are those landlords of around 18 per cent of all British buildings, according to the UK Green Building Council (UKGBC).
As a landlord of a non-exempt commercial property, you will start experiencing issues in your everyday asset management, where the building is subject to an EPC with an F or G rating. Now is the time to dig out your EPC, or ask your surveyor to do so.
Do consider the following;
1. Tenant engagement – it’s always good practice to engage with your tenant, but more so now.
2. Rent reviews – if you have a rent review this year, you will also need to consider MEES.
3. Lease renewal – less haste in any lease renewal. Consider your dilapidations position to cover interim or terminal voids.
4. Tenant’s fit-out – implications as to how these may affect the energy performance of the building.
5. Valuation – if you are seeking to finance or refinance, the energy performance of the property will have an effect on the ability to refinance.
This is not an exhaustive list and indeed there are various guidelines you should consider when complying with MEES. However, whether you have a trigger date this year in your lease or not, now is the time to be ahead of the regulations.
Where tenants are long-standing and loyal, they will not thank their landlord for urgent works at specific busy times of their year. While existing leases do have the comfort of 1 April 2023, solicitors acting for tenants will be looking carefully at EPC and landlords’ actions to deal with non-conforming buildings.
We are able to advise and assist landlords and provide a range of services from building consultancy to professional services and letting agency.
If you are an owner or an occupier of commercial property, we would be delighted to discuss any opportunities with you. Contact Simon Parsons, BSc (Hons) MRICS on 01536 213169.