Can’t make energy retrofits stack up? Try these six ideas.
Low RoI is one of the most common barriers to going ahead with energy-focused retrofits. We hear this from our clients, from the market, and see it confirmed in industry surveys time and again.
The good news is there are practical ways to improve the numbers. Here are six to consider.
1. Explore grant funding
Subject to qualifying criteria, there are national and local council-level grant funding programmes on offer. It’s worth doing the homework, the landscape changes regularly and there may be more available than you think.
2. Tax credits
For retrofits involving new M&E, these high-cost items can often qualify for tax credits. It’s a lever that’s sometimes overlooked, but it can make a meaningful dent in the upfront outlay.
3. Nil/low cost interventions
Not all energy-saving measures need significant investment. Look for the easy wins,it’s amazing how a saving of 1% here and 2% there quickly adds up.
4. Co-invest with tenants
Occupiers benefit financially from lower energy consumption, and for many it aligns with their company’s brand values. Open up the conversation and see if there’s a fit. Green leases help, but even without one, there’s still a worthwhile conversation to be had.
5. Sustainable financing
Lenders and funders with sustainability criteria can help reduce the initial financial outlay. Often their interest costs are tied to energy reduction results,which has a positive impact on cashflow and boosts retrofit RoI.
6. Business utility rates
Shop around to find the best rate for your asset, and encourage tenants to do the same. The savings can be more significant than expected.
These are just six ways to underwrite for better retrofit RoI,there are plenty of others.
What ideas have worked for you? We’d love to hear them, get in touch.
