Nyree Applegarth, Partner in the Higgs LLP Dispute Resolution and Litigation team, challenges commercial landlords to get ready for rule changes

Changes are imminent for meeting energy efficiency targets in commercial properties – but are you ready for them?

From April 1, 2023, a commercial property must have an E rating if it is to be lawfully let.

Although building owners have had since 2018 to make these changes, it is believed 10% of leased commercial properties will fall short of the new standard.

It means any landlord of a let building that does not meet the E rating that could face significant fines – up to an equivalent of 10% of the property’s rateable value, subject to a minimum penalty of £5,000 and a maximum of £50,000. 

After three months, this increases and the penalty rises to 20% of the rateable value with a minimum penalty of £10,000 and a maximum of £150,000.

The government has not yet released its foot from the pedal when it comes to energy efficient buildings: it is also proposing to increase the standard further by ensuring a minimum rating of B by 2030, with a potential interim milestone of C by 2027.

The gulf between an E and a B rating can be significant, which would potentially require a building owner to undertake expensive works to comply.

For all commercial property advice, contact either Nyree Applegarth or Cherry Elliott on nyree.applegarth@higgsllp.co.uk or cherry.elliott@higgsllp.co.uk