When long-established landlord Derwent Lodge Estates Ltd wanted to know the energy performance of some of the buildings in its diverse range of properties it looked for a company with first-rate expertise in the field.
Murton & Co came recommended by one of its management agency companies.
“We own and lease a range of residential and commercial properties, mainly in the North West of England,” explained Andy Heath, from Derwent Lodge Estates. “The portfolio includes industrial and retail units, bars and shops, many of them in the Manchester and Liverpool area.”
He said the company wanted to establish the Energy Performance Certificate (EPC) ratings of a number of its buildings. For the past 10 years, an EPC has been required when a commercial property is let or sold and since April 2018 a new piece of legislation was introduced prohibiting any building being let with an EPC in bands F or G – the two lowest and inefficient bands.
The current minimum EPC rating is band E, making it illegal to rent a building with an F or G rating, unless a valid exemption can be claimed. The government intends to raise this threshold to band B in 2030 and might also introduce an interim rating of band D in 2025. This is under consultation but the writing is on the wall – the minimum threshold will be raised.
“We wanted to protect and enhance the portfolio by putting together a long-term maintenance plan to improve the buildings if necessary,” said Andy. “It was important to understand what we needed to do for a particular property to future-proof it as an investment.”
Murton & Co was commissioned to help achieve these goals. Managing Director Jonny Murton surveyed a selection of properties of different uses, ages and structure to calculate their energy efficient rating and produce the EPC.
“Jonny also produced a Minimum Energy Efficiency Regulations report, which gave recommendations about what we needed to do to make energy improvements and achieve a higher EPC rating – and the cost of doing that work,” said Andy. “For example, common suggestions were to install an air source heat pump or LED lighting or increase the building’s insulation.”
Jonny included details of the pay-back period for each improvement measure. This is a key part of the decision-making process for a landlord/investor. It is also a measure for assessing whether an exemption can be applied. If the improvement does not pay back within seven years it is deemed uneconomical and so a landlord can claim an exemption to allow them to grant a new lease or lease-renewal without having to undertake the works.
What was it like working with Murton & Co? “Jonny was enthusiastic and easy to communicate with,” said Andy. “He responded to queries on time and he was flexible when arranging times for the surveys.
“I think the company understood our goals very well.”
He said Derwent Lodge Estates interviewed a number of energy assessors and it was clear from the outset that Jonny had a lot of knowledge and a good understanding of the energy efficiency regulations as well as landlord and tenant law. “Murton & Co provided a professional and adaptable service to meet our requirements. I would recommend them to other landlords if they needed an energy audit doing on their buildings.”
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