Minimum Energy Efficiency Standards (MEES)

How it will affect both your commercial and residential property?

From 1st April 2018, it will be unlawful for Landlords of commercial and residential properties with an EPC rating of less than ‘E’ to grant new leases or renew  leases except for some exemptions as follows:-

•    Listed Buildings do not need comply with MEES
•    Properties with a short lease (6 months or less) or with a long lease (greater than 99 years)
•    Cost effective improvement works that cannot have a payback period of 7 years
•    The Landlord cannot obtain Third Party consent from; Local Authority, Lender, Superior Landlords, Sitting Tenant etc.
•    If a Surveyor determines that the energy efficiency improvements would devalue the property by more than 5%.

Exemptions are valid for 5 years and to qualify, the Owner/Landlord must register the property on the Private Rented Sector (PRS) Exemptions Register. www.prsaccreditation.com/contact-us/
•    Penalties for non-compliance range from £2,000 to £150,000 depending on the rateable value of the property.
•    Penalties apply where the Landlord has supplied incorrect or false information on the PRS Register
•    Names of Landlords will be published on the PRS Register
•    If a substandard property is sold, the new owner has 6 months to comply with MEES.

What do you need to do next?
1.    Assess the possibility
a.    Identify properties with E or lower EPC ratings
b.    Ensure EPCs are valid
c.    Determine if any properties are exempt and are on the PRS Register

2.    Plan improvement works
a.    Develop a plan of work needed.
b.    Obtain any necessary consents
c.    Investigate funding available

3.    Consult with your Tenants
a.    Leases do not usually state works to include energy efficiency.
b.    Discuss proposals with them early
c.    Add Memorandum of Understanding to any new Lease for future works
d.    Ensure Tenants fit out proposals will not affect the EPC rating

Edward Fifield, Director of Fifield Glyn comments ‘We believe that it is beneficial for Landlords to act prudently and plan ahead. We at Fifield Glyn are happy to advise our Clients with their property portfolios and see which property’s fall below the ‘E’ grade and help take the necessary works to improve the EPC rating or whether exemption will apply’.

If you would like to know how this new regulation can affect your property, please contact Edward.fifield@fifieldglyn.com or your Property Manager.