Changes to the Minimum Energy Efficient Standards (MEES) for commercial property

The countdown to the next set of changes to the Minimum Energy Efficient Standards (MEES) for commercial property is now less than six months away – and the changes are significant.

From 1 April 2023, any letting of a commercial property, whether a new lease or an existing one, will require a minimum energy performance certificate (EPC) rating of E, subject only to a few exemptions. Coupled with this penalties for non-compliance, which will fall on Landlords, are also toughening and can be up to £150,000.

To avoid a MEES breach Landlords need to consider now what steps they can take to ensure their commercial properties are compliant. The starting point is to review the existing EPC and its accompanying Recommendation Report which may point out a few easy and straightforward wins that may turn an F Rating to an E.  This could include changes to lighting and draught proofing which, coupled with increased energy costs should prove a win win for both Landlords and Tenants who will be under pressure to pay rents.

In addition to checking an existing EPC Recommendation Report, Landlords should also check their leases to ensure the lease provides the Landlord with the required rights to carry out upgrading works.  Importantly the lease should also confirm who will foot the bill for these works, from a Landlords perspective it should be hoped that some, if not all, of the cost can be passed on to the Tenant, with the Tenant, as noted above, benefiting from a more energy efficient premises.

Time is now critical on this and Landlords need to be aware that the direction of travel is towards increased energy efficiency requirements as the MEES tighten further with a minimum of a D Rating required by April 2025.

Whilst in the short term the cost implications for any required improvements will not be welcome increasing energy efficiency will in the longer term add value to property and protect a Landlords interest. A property which is easier to heat will result in reduced energy bills, which will therefore aid its marketability and be a plus point for tenants. 

Thursfields team of commercial real estate solicitors will ensure you achieve your desired outcome. Delivering commercially focused, proactive advice to ensure your investment is protected.

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