Planning to move your business?

If you are a business tenant you will need to be aware of changing legislation, which could mean that you are at risk of having to pay to improve your building’s energy rating.

Minimum energy performance standards (MEPS) are due to be introduced by April 2018. From that date, landlords of commercial properties that fall below the minimum rating – likely to be an ‘E’ rating under the EPC – will need to carry out improvement works before letting the property.

If you are planning to move your business to new premises, it is now very important that you get expert advice to ensure that the terms of your lease do not make you vulnerable to expensive works and disruption when MEPS are introduced.

Depending on the terms of the lease, you – as the business tenant of a property with a poor energy rating – could be obliged to pay for and carry out potentially expensive works, such as installing a more modern boiler, double glazing or loft and wall insulation.

You will also need to think about how to minimise the disruption if any improvement works are needed. If your landlord is carrying out the works, you may prefer this to happen after the lease has ended and you have moved out of the property, for example.

If you plan to sublet part, or all, of the property, to other businesses you will need to consider how to make alterations or improvements to it to bring it up to MEPS minimum standard. Meeting the standard will make the property more attractive and will help you sublet the spaces more quickly.

Even if your business property has an EPC rating of E or higher, you should be aware that changes to the way EPCs are prepared means that properties initially rated E may get a lower rating if they were re-inspected now.

If you are looking to move your business or have any concerns about your current lease arrangements, your solicitor should be able to advise you on how the Energy Act 2011 might impact on you – now or in the future. Coodes has a dedicated Commercial Property team to guide you through the process of finding premises on the right terms for your business.

For more information on this or any commercial property related enquiries contact Helen Willett Head of Commercial Property at Coodes on 01736 352246 or email helen.willett@coodes.co.uk.