📋 Tender Overview
1.4 billion sq ft of retail space across the UK - 83 of all stock - will need to be improved by 2030 to meet the minimum standards required for a Grade B Energy Performance Certificate EPC set by the Government in its 2021 Net Zero Strategy according to new research by Savills released at the COP26 climate change summit.185 million sq ft 17.2 million sq m of this space may become unlettable as soon as 2023 says Savills where ambitious targets to decrease carbon footprints through the Minimum Energy Efficiency Standards MEES will prohibit commercial buildings with an F or G rating from being let. Approximately 25 of retail property carbon emissions are generated by units within shopping centres retail parks and high street blocks which arguably are the easiest to eradicate according to Savills due to these assets tending to be larger more modern and principally owned by large institutional landlords which have access to the finance and expertise required to green them. 75 of retail property emissions however are generated by smaller premises in secondary and tertiary locations and owned by private landlords posing financial significant challenges particularly in the current environment when the retail industry is suffering significant financial hardship amid ongoing structural change.Tom Whittington director in Savills commercial research team comments When looking at the EPC ratings and size of UK retail properties its no surprise that the average A-rated shop is five times larger than a G-rated shop with the former far more likely to be modern and owned by a large landlord. There is also a strong correlation between the worst performing assets and high retail vacancy rates which begs the question whether improving some shops is actually worth the investment particularly in these straightened times. Landlords are either going to require more Government intervention policy and support to drive the change or this space may find a new life under a different use which could make the upfront investment in improving its energy performance more cost-effective.
