Request a callback

If you want to discuss a particular service or need help, call us on 02476 231000.

Will Your Commercial Property Be EPC Compliant?

Askews Website 2022 Commercial Property Compliance

As commercial property owners are aware, it is a necessity to be compliant with a specific Energy Performance Certificate (EPC) rating. Currently an EPC minimum rating of E is required for a landlord to successfully grant or renew a lease, subject to certain exemptions.

From 1st April 2023, this is set to change, and it shall be necessary for a landlord to have a minimum rating of E for existing tenancies as well as new tenancies, the emphasis being on “existing tenancies”. This means that a landlord cannot continue with an existing tenancy if the EPC rating is below an E, and if ignored, subject to certain exemptions, the landlord could be subject to punitive measures.

How can a landlord ensure compliance?

  1. The landlord actions sufficient energy efficiency improvements to the property, so that it fulfils the minimum current EPC rating of E;
  2. The landlord can claim a legitimate reason not to do so, and this has been validly registered on the PRS Exemptions Register.

Plan ahead:

  • Look at your property portfolio, and check whether your current EPC rating will be compliant. If you do not have this to hand, you can access this information online: https://www.gov.uk/find-energy-certificate;
  • If you are likely to be required to make changes, speak to a professional such as a surveyor about how you can be EPC ready as soon as possible;
  • Be aware the government are currently deliberating further reforms in relation to EPCs, further changes are likely to be phased in by 2027, and again in 2030 increasing the rating required for an EPC. We could even see a mandatory EPC rating of B for commercial properties by 2030;

With reform on the horizon, it is worth noting that securing a new mortgage for your commercial property could become harder, and more expensive, there is also the risk that Lender may view their current securities at risk and call in loans – this is yet to be seen! Lenders may implement, or already have a uniform policy stipulating a minimum EPC rating is required, and such policy would need to be satisfied before the refinance can be completed. This could of course also have an impact on the value of the commercial property in question. If you have any questions regarding anything covered in this article, please call us on 02476 231000 or email enquiries@askewslegal.co. Please note that this article is for information purposes only and does not constitute legal advice.