The paper investigates the initial impacts on asset management and valuation practice of the Minimum Energy Efficiency Standard (MEES) introduced in England and Wales from April 2018 for new lettings.
The paper reports findings from a small-scale pilot study of valuers, asset managers, lawyers and building consultants. Interviews were conducted over the summer of 2019 and explored the impact on practice and market values and perceived links to the carbon reduction agenda. Data were analysed thematically manually and using NVivo software.
Participants welcomed MEES but many had doubts about the use of energy performance certificates (EPCs) as the appropriate baseline measure. Compliance was perceived as too easy; further, enforcement is not occurring. Vanguard investors have aligned portfolios for carbon reduction; others have not. Lease practices are changing with landlords seeking greater control over tenant behaviours. Valuers reported that whilst MEES consideration is embedded in due diligence processes, there is limited value impact.
The study is limited by its small-scale and that the MEES regulations are not yet fully implemented. However, the research provides early findings and lays out recommendations for future research by identifying areas in which the regulations are/are not proving effective to date.
The findings will inform investors, consultants and policy makers.
Achieving energy efficiency in buildings is critical to driving down carbon emission; it also has economic and social benefits through cost savings and reducing fuel poverty.
Believed to be the first post-implementation qualitative study of MEES.
