Are you a Landlord of a commercial property?

If the answer is yes to the question above, then you need to check the Energy Performance Certificate rating of your commercial property.

For some time now, when letting most commercial property, a valid Energy Performance Certificate ('EPC') has been required with a rating between A and E. However, the rules from the 1 April 2023 are changing and any property with an EPC rating of F or G will be classed as sub-standard and it may become illegal to continue letting it. This means that, unless you can rely on one of the limited exceptions, you (or the tenant depending on the wording of the lease) may need to carry out improvement works to the building to bring the rating of the building up to the required standard.

It may be that any buildings falling below the minimum standards do not require major works to be carried out and a few minor adjustments may be enough, but Landlords should be looking at this now and checking any property in their portfolios.

What are the changes from April 2023?

From 1 April 2023, the rules will be extended to include all rented commercial properties where the leases are mid-term.

It is also worth noting that the government is proposing to increase the minimum EPC rating to 'C' or higher by 1 April 2027, rising to a 'B' or higher rating by 2030.

What should I do now?

• As a landlord, you should check that your property/properties has/have a valid EPC rating of band 'E' or better.
• If not, to be able to continue to lease the building after 1 April 2023, you will need to take urgent action to bring your commercial property up to the minimum rating of 'E' or above (unless you are exempt).
• You should check when any current leases are due to expire. If this date falls after 1 April 2023, check whether you have the right to access the property to undertake any remedial work under the terms of the lease.
• You should also check the terms of current leases as to whether you can recover any costs to meet the EPC rating from the tenant.

Further guidance has been provided on the Government website.

You can also speak to our team of experts for more information.

Although every effort has been made to ensure that the information provided in this article is accurate and correct, the information provided does not constitute any form of advice.