Warning that energy inefficient offices risk becoming obsolete 

Society of Chartered Surveyors Ireland says owners could be left with 'stranded assets' if they do nothing in terms of retrofitting

Society of Chartered Surveyors Ireland report says the Sustainable Energy Authority of Ireland (SEAI) should review grant allocations and thresholds for commercial buildings. Picture: iStock 

Office buildings that are less energy efficient are facing an increasing risk of “obsolescence” with owners potentially being left with “stranded assets” if they decide to do nothing in terms of retrofitting, a new report by the Society of Chartered Surveyors Ireland (SCSI) has found.

However, the report found that retrofitting may not be financially viable in all instances and has recommended that the Sustainable Energy Authority of Ireland (SEAI) conduct a review of grant allocations and thresholds for commercial buildings.

The report focused on “hard costs” which are expenses related to the physical work of the retrofit including demolitions, structural repairs, and upgrades to the building’s exterior walls and roofs among other work. It excluded soft costs such as professional and finance fees.

SCSI president Kevin Hollingsworth said a 'do-nothing' stance on the part of office building owners 'presents a significant risk' as the market 'increasingly prioritises high-performing, sustainable properties'.

The report assessed seven properties with varying degrees of age and conditions to determine whether the value added from the retrofit would offset the costs of the retrofit.

CLIMATE & SUSTAINABILITY HUB

Only three of the seven were deemed financially viable. All the buildings assessed had a C2 Building Energy Rating (BER) or below.

The commercial sector lags behind in responding to energy upgrade targets with almost 60% of offices having a BER of D1 or lower.

In office buildings where retrofitting was deemed viable, the report found retrofitting could have a positive impact on rental income with potential increases ranging from 40% to 66%.

Kevin Hollingsworth, president of the SCSI, said a “do-nothing” stance on the part of office building owners “presents a significant risk” as the market “increasingly prioritises high-performing, sustainable properties”.

“Owners who fail to adapt risk being left behind with stranded assets.” Mr Hollingsworth said the SCSI is recommending the SEAI start a review of grant allocations and thresholds for retrofitting costs to encourage a greater focus on “fabric” upgrades."

Fabric upgrades referrers to the materials that make up a building's exterior and buildings of a certain age can reduce heat loss by upgrading their fabric.