As much as 85% of UK office buildings are at high risk of being unlettable due to EPC regulations proposed to be implemented in 2027 according to new data from PwC UK.
Based on geo-spatial analytics, the data shows this risk is spread right across the UK, with hotspots occurring in the South East, the North West and Central England for buildings rated ‘C’ or below.
Mark Addley, real assets deals leader at PwC, said: “Our analysis illustrates the stark challenge facing UK landlords and developers now. With a potential update to the EPC regulation for commercial real estate targeted for 2027, the clock is ticking to ensure office stock meets the refreshed rules. Even if the legislation timing slips, tenant expectations around ESG credentials will remain.
“For some, the best course of action will be to make tweaks which ensure they are compliant; however, by not facing this issue they may end up with a significant challenge down the track. Others may look to completely rebuild or repurpose and depending on the age of the building, demolition may be the best option, however the significant embodied carbon impact of this will need to be taken into account.”