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Environmental Focus / Continued
We continue to use lease events, common area works and EPC renewals to implement improvement works with the overall aim of continually improving our EPC score and ensuring compliance with MEES. Whilst there has been no change to MEES regulations following the UK Government consultation in 2021 on raising the minimum EPC level to a B by 2030, we are committed to improving our EPC ratings to a B or better wherever it is economic and appropriate to do so. Alignment with MEES regulations is integral to our net zero carbon pathway, occupier engagement strategy, and environmental focus. We will continue to proactively manage the portfolio on this basis.
Our green lease clauses continue to be successfully incorporated in new lettings and renewals. We are now fully aligned with the updated Better Buildings Partnership best practice. Jay Cable Head of Asset Management
Green lease clauses Green leasing continues to be an important tool to enable us and our occupiers to improve the performance of a building. A green lease will help enhance the environmental performance of a building, mitigate any environmental legislative and market risk and foster improvements in data collection. Over the year, 99% of our leases completed included green lease clauses. In January 2024, the Better Buildings Partnership released updated guidance on green leasing. As at April 2024, we have updated our standard form lease and heads of terms to align with the new best practice and moving forward all leases will align with the Better Buildings Partnership Green Lease Essentials. We will continue to use lease events and letting of vacant units to drive further take up. Minimum Energy Efficiency Standards (MEES) We continue to improve the EPC profile of the portfolio. Looking at the percentage of EPC ratings by estimated rental value (ERV) of our portfolio, 80% have an EPC rating of A–C, this is an improvement on the 76% A–C recorded for the year to March 2023. We continue to be fully compliant with MEES and have no F or G rated space in the portfolio. Over the year, we reassessed 43 EPCs. Using the same reporting basis as above, 88% have been reassessed to an A–C rating, 12% to a D or E rating, and none were F or G rated. The weighted average score of the EPCs completed in the year improved from a D to a B rating.
Percentage of portfolio EPC ratings A–C by ERV (%)
90 80 70 60 50 40 30 20 10 0
2024 2023 2022 2021 2020
EPC ratings as a percentage of portfolio by ERV (%)
50 45 40 35 30 25 20 15 10 5 0
80% EPC ratings A–C 57 Green leases completed
A B C D E F G
Picton Property Income Limited / Annual Report 2024 68
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