A fifth all Birmingham’s commercial buildings could become virtually unlettable within six years if landlords don’t take urgent action because of new legislation, it is claimed.
The bleak outlook for a fifth of the city’s commercial property stock is revealed in a new report from property consultants Cushman & Wakefield.
The Energy Act of 2011 proposes to make it unlawful to let properties rated as F or G on their Energy Performance Certificate (EPC) after April 2018.
And with many High Sreet shops and historic office buildings falling far short of the energy efficiency standards required to achieve an E rating (with A being the highest award) landlords could be facing a “green timebomb.”
Phillip Taylor, head of asset management at Cushman & Wakefield in Birmingham, said: “A building with a poor energy efficiency rating will effectively become obsolete until improvement works are undertaken.
“Landlords will not be able to let the building and tenants won’t want to lease it. However the good news is that landlords have six years to get their buildings in order but they need to start planning now so they are not caught unawares and are left with empty shops and offices in their portfolio.
“One of the biggest issues is reducing the consumption of energy – for example it is amazing how much of a difference good insulation and lights on timer switches can make. “Shopping centres in particular are very bad for leaving the lights on, one shopping centre we looked at in England left 80 per cent of its lights on at night, generating huge electricity bills.”
He warned there were no simple fixes to the problem, with the cost of improving some buildings such as small retail units potentially exceeding any increased value. “While the vast majority of buildings will be able to be brought up to standard it will not be cost effective for landlords of older stock and they may decide to leave their building empty or demolish it and rebuild.”