{"id":23327,"date":"2025-11-27T14:42:58","date_gmt":"2025-11-27T14:42:58","guid":{"rendered":"https:\/\/www.riaabarkergillette.com\/uk\/?p=23327"},"modified":"2026-01-30T12:03:57","modified_gmt":"2026-01-30T12:03:57","slug":"mind-the-energy-gap-commercial-landlords-face-a-closing-window-on-epc-compliance","status":"publish","type":"post","link":"https:\/\/www.riaabarkergillette.com\/uk\/mind-the-energy-gap-commercial-landlords-face-a-closing-window-on-epc-compliance\/","title":{"rendered":"Mind the energy gap: Commercial landlords face a closing window on EPC compliance"},"content":{"rendered":"\n<div style=\"height:20px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<p>A chilly draught is blowing through the commercial property market, as tightening EPC rules mean landlords must seal the gaps in energy performance before key deadlines shut them out of future lettings.<\/p>\n\n\n\n<p>Under current proposals, the minimum EPC (Energy Performance Certificate) rating for commercial properties is set to increase from E to B, with legal prohibitions on letting non-compliant buildings.<\/p>\n\n\n\n<p>For many landlords, this will demand significant investment and forward planning to avoid regulatory penalties or stranded assets.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-what-s-changing-and-what-s-at-stake\">What\u2019s changing and what\u2019s at stake<\/h3>\n\n\n\n<p>The Minimum Energy Efficiency Standards (MEES) set performance requirements for properties to be legally let in England and Wales. The aim is to improve the energy efficiency of the nation\u2019s building stock and help the UK reach its net zero targets.\u00a0<\/p>\n\n\n\n<p>Since April 2023, landlords of non-domestic let property must ensure their building has at least an EPC of E, even when there has been no renewal or assignment of the lease.\u00a0Without an exemption, buildings rated F or G may already be categorised as substandard.\u00a0<\/p>\n\n\n\n<p>And those standards are expected to tighten. While the original timetable to increase from EPC rating E to C in 2027, then to B in 2030, has been pushed back, the Department for Energy Security and Net Zero (DESNZ) is expected to confirm new deadlines by the end of 2025.\u00a0<\/p>\n\n\n\n<p>Brinda Granthrai, Partner and Head of Commercial Real Estate, explained: <\/p>\n\n\n\n<p>\u201cWhile we\u2019re waiting to hear from DESNZ, it is unclear whether the interim milestone of EPC C will remain part of the framework, but EPC B does remain projected as the future benchmark and will most likely be required between 2030 and 2035.\u00a0It may seem a long way away, but these changes carry real financial and operational implications, as a large proportion of commercial stock could fail to meet the new standards without urgent upgrading.\u00a0Reports suggest up to 70% of commercial floor space in England and Wales is currently rated C or below, putting an estimated \u00a3700 billion of assets at risk of becoming underused or unlettable.\u201d\u00a0\u00a0<\/p>\n\n\n\n<p>A range of MEES exemptions may be available, but each has tight conditions. These include situations where upgrades are not economically viable within a seven-year \u201cpayback\u201d period; where all reasonable improvements have already been carried out; where required works would damage the building; or where third-party consent, such as from a tenant or lender, is refused.&nbsp;<\/p>\n\n\n\n<p>Landlords should also be aware that exemptions under MEES are not permanent or transferable.\u00a0Any exemption registered on the PRS Exemptions Register lapses automatically when the building changes<em> <\/em>ownership. This means that a buyer cannot rely on the previous landlord\u2019s exemption, but new landlords can apply for a six-month temporary exemption while they make improvements or register a further valid exemption.\u00a0<\/p>\n\n\n\n<p>\u201cThese deadlines aren\u2019t far off,\u201d added Brinda. \u201cLandlords need to treat these EPC changes as a core risk to their assets. Delay equals expense &#8211; and potential loss of rental income. The time to act is now.\u201d<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-what-landlords-should-do-now\">What landlords should do now<\/h3>\n\n\n\n<ol class=\"wp-block-list\">\n<li><strong>Audit your portfolio<\/strong><\/li>\n<\/ol>\n\n\n\n<p>Identify which assets are at risk (D, E, F, G rated) and prioritise those requiring upgrades.<\/p>\n\n\n\n<ol start=\"2\" class=\"wp-block-list\">\n<li><strong>Plan improvements early<\/strong><\/li>\n<\/ol>\n\n\n\n<p>Heating systems, insulation, glazing, lighting, building controls, and renewable energy will all be key levers.<\/p>\n\n\n\n<ol start=\"3\" class=\"wp-block-list\">\n<li><strong>Check and register exemptions<\/strong><\/li>\n<\/ol>\n\n\n\n<p>Some properties may qualify for valid exemptions (e.g. due to cost or structural constraints). These must be registered to be relied upon.\u00a0<\/p>\n\n\n\n<ol start=\"4\" class=\"wp-block-list\">\n<li><strong>Document decision-making<\/strong><\/li>\n<\/ol>\n\n\n\n<p>Keep clear records of assessments, cost-benefit analyses, and upgrade plans. These may prove crucial in defending against enforcement action or negotiating leases.<\/p>\n\n\n\n<ol start=\"5\" class=\"wp-block-list\">\n<li><strong>Revisit lease drafting &amp; landlord rights<\/strong><\/li>\n<\/ol>\n\n\n\n<p>Ensure leases give landlords the power to carry out upgrades or require tenant cooperation where needed.<\/p>\n\n\n\n<ol start=\"6\" class=\"wp-block-list\">\n<li><strong>Monitor policy developments<\/strong><\/li>\n<\/ol>\n\n\n\n<p>The Government is consulting on further reforms to the Energy Performance of Buildings (EPB) regime.&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-about-the-author\">About the author<\/h3>\n\n\n\n<p><a href=\"https:\/\/www.riaabarkergillette.com\/uk\/our-team\/brinda-granthrai\/\">Brinda Granthrai<\/a> joined RIAA Barker Gillette (UK)\u2019s\u00a0<a href=\"https:\/\/www.riaabarkergillette.com\/uk\/our-expertise\/for-business\/commercial-real-estate\/\">commercial real estate<\/a>\u00a0team in May 2025. She brings over 15 years of experience advising high-net-worth individuals, private companies and international investors on complex real estate transactions. She works closely with the team to deliver commercially focused, pragmatic solutions across the full property lifecycle.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Upcoming changes to commercial Energy Performance Certificate (EPC) requirements mean landlords face tightening rules on energy efficiency, with the Government expected to confirm the next phase of Minimum Energy Efficiency Standards (MEES) by the end of 2025.<\/p>\n","protected":false},"author":12,"featured_media":23328,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_coblocks_attr":"","_coblocks_dimensions":"","_coblocks_responsive_height":"","_coblocks_accordion_ie_support":"","footnotes":""},"categories":[9],"tags":[15],"class_list":["post-23327","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news-story","tag-commercial-property"],"acf":[],"yoast_head":"<!-- This site is optimized with the 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