Just as Spring is (hopefully) beginning to provide lighter and warmer days in April, commercial landlords need to be aware of the arrival of another feature the season will bring in 2023 – the tightening of the MEES restrictions for commercial property.
Landlords will be familiar with the Minimum Energy Efficiency Standards, and the requirement for properties (unless an exemption applies) to have achieved at least an E rating before the property can be let. Those rules have applied to any new lease of a non-domestic letting since 1 April 2018 (with similar rules also applying to rented residential properties).
However, landlords may have overlooked the longstop date contained in the MEES Regulations, which stated that there will be a prohibition on the letting of ‘substandard’ properties (i.e those with an F or G rating) from 1 April 2023. Longer term non-domestic lettings (of which there will be many) which commenced before 1 April 2018 will therefore now be caught by the MEES provisions.
There will be properties where all relevant improvements that can be done have been done, and yet those improvements are still not enough to achieve an E rating or above. The exemptions regime will continue to apply, with landlords needing to ensure exemptions are registered. The April date is not, therefore, going to result in every non-domestic property becoming energy efficient overnight.
Landlords should however be aware of the changes and urgently consider what, if any, steps they need to take. The devil is very much in the detail in the regulations and so careful consideration is needed to avoid falling foul of the regulations. As has always been the case, enforcement of the regulations is by local authorities, usually through their Trading Standards teams, with breaches being pursued through the civil courts.
A final word. Even those landlords who do have property meeting the minimum E standard should not rest on heir laurels. The Government have signalled that changes will be made to the MEES regime and, unsurprisingly, that those changes will be aimed at ensuring energy efficiency in buildings is substantially increased, quite possibly over a relatively short timeframe. The message to landlords is to keep matters under careful review.