EPC Improvement Finance

The government has proposed that all commercially let properties in England and Wales must achieve a minimum EPC rating of C by 2028. Currently, the minimum is E (enforced from April 2023). Properties that don't meet the minimum standard cannot legally be let unless a valid exemption is registered. 

The direction of travel is clear - ratings requirements will continue to tighten.

Costs vary enormously depending on the building type, current rating, and what improvements are needed. Moving from an E to a C might cost anywhere from £30,000 to £300,000+ depending on building size and the measures required. 

Your energy assessor or contractor's specification will give you the specific figure for your property.

This depends on the building, but common high-impact measures include insulation (roof, walls, floor), HVAC system upgrades, LED lighting with controls, and renewable energy installations. 

Your energy assessor will have identified which measures deliver the most improvement for your specific building.

Potentially, yes. Some EPC improvement projects qualify for unsecured commercial finance depending on the business profile and project scope. The projected improvement in building value, compliance with regulations, and reduced void risk all form part of the commercial case. 

We'll be straightforward about what's realistic.

Currently, you cannot legally let a commercial property with an EPC rating below E unless you've registered a valid exemption. Penalties for non-compliance are significant - up to £150,000 for properties with a rateable value above £100,000. 

As the minimum rating rises to C, more properties will be affected.

In most cases, yes - though it depends on the specific works. LED lighting upgrades and some insulation works can typically be completed with minimal disruption. Major HVAC replacements may require phased installation. 

Your contractor will advise on the programme and any disruption to occupiers.

It helps but isn't essential. If you have contractor quotes or a building survey specifying the improvement works and their expected impact on the EPC rating, that's usually enough to start the conversation. If you don't have this yet, getting an EPC assessment is a sensible first step.

Yes. Portfolio landlords and multi-site operators may be able to structure improvement programmes across several properties within one finance facility. This can simplify the process and may present a stronger overall case to lenders than funding each property individually.

We work with specialist lenders who understand property improvement projects and can assess them on their commercial merits - including the impact on building value, lettability, and compliance. 

This often means more appropriate terms than a generic business loan that doesn't account for the property improvement context.

It depends on the lease. In some cases, tenants undertake improvement works - particularly where they benefit from reduced energy costs during their lease term. The lease terms, remaining length, and landlord consent are all factors. 

We're happy to discuss your specific situation.

Generally, yes. Properties with better EPC ratings command higher rents, attract better tenants, and have lower void periods. As MEES requirements tighten, the gap between compliant and non-compliant property values is likely to widen. 

The improvement in asset value forms part of the commercial case for lenders.