Three quarters of Belfast’s office stock could become obsolete by 2030, a leading figure in the north’s property sector has warned.
Brian Lavery, who heads the CBRE operation in the north, said it is only a matter of time before new minimum EPC (energy performance certificate) standards, already in place in England and Wales, take effect in Northern Ireland.
He told a crowd of 500 industry insiders that “a seismic shift is looming over Belfast’s commercial real estate sector”.
The CBRE NI managing director was addressing the consultancy firm’s annual commercial property outlook event at the ICC Belfast on Thursday morning.
In April 2023, the minimum EPC rating for commercial buildings was raised to ‘E’, for any commercial building being sold, leased or rented across England and Wales.
It is predicated that the next change in EPC legislation, due in 2025, will see the minimum rating increase to ‘B’ by 2030.
If Belfast is to keep up, it will require significant upgrading or repurposing of the city’s office stock, said Brian Lavery.
“With our research indicating only 25% of Belfast’s large office buildings are currently rated EPC ‘A’ or ‘B’, property owners and investors are faced with a stark choice: either make substantial investments to bring properties up to speed with EPC and ESG [environmental, social, and corporate governance] requirements or contemplate changing the use of these buildings altogether.
“With regulatory change inevitable, it is imperative that landlords of older commercial stock act now to implement ESG strategies or risk being left with properties that are unlettable or difficult to market successfully.”
The annual event, which brings together some of the most influential figures in the north’s commercial property sector, put sustainability firmly at the top of agenda for 2024.
The keynote speaker was Sir Timothy Smit, co-founder of the Eden Project near St Austell in Cornwall, and a globally recognised voice when it comes to environmental conservation and preservation.
“The looming crisis in the commercial property market requires bold action but presents unrivalled opportunity,” he said.
“Positively championing new technologies, materials and philosophies to make our buildings not only fit for purpose but also healthy for those that live and work in them, enables us to ultimately do the right thing.”
The Dutch-born British businessman, who last year received an honoury doctorate from Queen’s University Belfast, said by embracing change and acting fast on ESG, Northern Ireland could put itself at the forefront of ‘a new green energy enlightenment’.
“Cities and towns in Northern Ireland could become beacons of best practice,” he said.
“Encouraging innovators and investors to these shores and instilling confidence in all who live here.”
The event was also presented with CBRE NI’s new ESG partnership, developed with FPM Accountants.
The firm’s executive director, Gerard McCann, said CBRE NI is the first commercial property agents in the north to form a consortium of experts specifically tasked with assisting companies manage their properties and estates along ESG guidelines.
“A new, proactive five-stage process aims to support clients by ensuring they are legislatively compliant, in order to maximise and futureproof the value of their assets and ensure return on their investment,” he said.
“We have already seen how buildings like City Quays, The Ewart and Olympic House, all developed to the highest ESG credentials, have proven to be very attractive to potential tenants in Belfast.”
