MEES – why landlords need to grasp the opportunity for a greener tomorrow

The 1 April 2023 was a seminal date in the push towards greener credentials for commercial property.

The implementation of Minimum Energy Efficiency Standards (MEES) for UK commercial properties brought about a significant transformation in the real estate landscape.

As discussed in recent blogs, the milestone marked the prohibition on letting sub-standard properties with ‘F’ or ‘G’ Energy Performance Certificate (EPC) ratings.

This sent out a clear message about the importance of energy efficiency in the built environment. But what has the impact of MEES been to date and what are the cost implications and potential long-term benefits of embracing energy efficiency?

Carl Grint, Head of Property Asset Management at Vail Williams, explores.

Financial burden or opportunity?

It goes without saying that improving the energy efficiency of commercial properties requires a financial investment.

Whilst property owners and landlords might initially perceive this as a burden, fearing the impact on asset value, their requirements under MEES Regulations is actually an opportunity.

It is crucial to recognise that the transition towards more energy efficient buildings can reap many benefits – from increased property value to tenant appeal, as more and more businesses embrace and implement their Environmental, Social and Governance (ESG) policies.

By enhancing energy performance, buildings become more desirable to tenants seeking sustainable and cost-effective spaces.

Energy-efficient properties are also more likely to benefit from reduced operational costs, including lower energy bills and maintenance expenses, which in turn, improves the overall profitability of the asset.

Delivering competitive advantage

While the financial implications of MEES are important, so too are the needs and expectations of commercial tenants.

Today, businesses in the UK are increasingly focused on sustainability and environmental responsibility.

Energy-efficient buildings not only align with these values but also offer a more comfortable and productive working environment.

By investing in improvements, property owners can attract and retain quality tenants, foster positive tenant-landlord relationships, and create a competitive edge in the UK market.

Importance of accurate EPCs

Accurate Energy Performance Certificates (EPCs) play a vital role in the implementation of MEES in the UK.

These certificates provide valuable insights into a property’s energy efficiency rating, highlighting areas for improvement.

If they haven’t already done so, it is essential for owners of commercial property in the UK to obtain up to date EPCs to assess their compliance with MEES and identify opportunities for building enhancement.

Collaborating with certified assessors can ensure the accuracy of EPCs, allowing for informed decision-making when it comes to energy efficiency upgrades.

Play the energy efficiency long game

While the initial financial implications of MEES can appear challenging for commercial property owners, it is important to consider the long-term benefits.

Upgrading your property’s energy efficiency can yield substantial savings in energy consumption, reducing carbon footprint and contributing to a sustainable future.

Energy-efficient properties also tend to attract environmentally conscious investors, potentially opening doors to new funding opportunities.

So, by taking action now, you can stay ahead of future regulatory changes, avoiding potential penalties and disruptions in the rental market.

The 1 April 2023 was a pivotal moment for the UK real estate industry, as Minimum Energy Efficiency Standards (MEES) drive a necessary shift towards energy-efficient buildings, compelling owners of commercial property to prioritise sustainability and their tenants’ needs.

While the cost implications of compliance may raise concerns, the long-term benefits, such as increased asset value, tenant satisfaction, and reduced operational costs, make the investment worthwhile.

By embracing MEES and improving energy efficiency, property owners in the UK can make a positive impact on the environment and position themselves for a prosperous and sustainable future in the commercial property market.

However, accurate Energy Performance Certificates (EPCs) are a crucial tool in this transition, providing valuable insights and guidance.

Vail Williams can support you in seizing this opportunity and paving the way for a greener tomorrow. For more information about the energy and sustainability services we provide, get in touch.