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Press release: New partnership Ploum, AREA and Facilicom: ‘Obligatory energy label C is in danger’

07 May 2020
Construction and Real Estate

The obligation for every office to have energy label C as per 2023 will become a millstone around the necks of lessors and lessees, according to Ploum | Rotterdam Law Firm, AREA Occupier Solutions and Facilicom Energy Management. Because of the corona crisis, in the following two years a shrinkage of 15% is expected for the construction sector. And entrepreneurs who are hit have other priorities than upgrading their building. In order to help market parties towards label C, the three parties entered into a partnership.

Part of the energy transition in the Netherlands is that every office larger than 100 m2 needs to have at least energy label C in about two years. According to research in September 2019, 60% of the offices does not yet comply with this sustainability requirement, which is approx. 41 million m2. The majority of this (83%) does not have an energy label at all. When making a conservative estimation of the missing energy labels, in total 29.7 million m2 has to be enhanced for sustainability which is equal to approx.  8.5 million m2 per year. That is an enormous task. If large steps are not being taken in the upcoming period, that could cost lessors their lessees and lessees their building.

‘There is a lot of uncertainty about this in the market. Awareness is also missing about how urgent this actually is and what the legal consequences are once it is 1 January 2023’, says real estate lawyer Anton van den Heuvel of Ploum. With ‘Checkjelabel.nl’, Ploum, AREA Occupier Solutions and Facilicom Energy Management are going to counsel lessees and lessors on all areas.

Multi-year maintenance plans

Facilicom Energy Management has already been focusing quite a while on making buildings more sustainable. This part of Facilicom Solutions provides energy advice on an operational, tactical and strategical level. Monica Gaastra, energy transition consultant: ‘Right now you notice that companies have a lot on their mind already. Obtaining label C has become a bit of a side-issue. But the longer you wait, the more costs will become higher, then it can suddenly hurt. For example, you could check in time whether the multi-year maintenance plan contains fitting moments on which sustainable solutions can be integrated.’ The companies within Facilicom Solutions can also take care of the implementation, says director Management and Advice Ludwig Holzapfel: ‘As a total provider we can advise, operate and guarantee, but we are also independent. With our partnership we especially want to mobilize and boost the market, before it is faced with a fait accompli in 2023.’

‘Readjust future plans’

Especially because of the corona crisis, companies will have to readjust their future plans’, says Sven-Olaf de Vries, business executive at AREA. As a consultancy firm for office accommodation, AREA has all the required expertise to assist end users of commercial real estate from A to Z. ‘Entering into a lease agreement or extending an existing lease agreement usually offers the possibility to realize savings or to implement a new, custom made workplace concept, for example. In addition, it is currently the ideal moment to raise sustainability issues and to make good arrangements with the lessor about this particular aspect. Our expectation is that companies may look differently at technology and working at home than before. This will have an impact on the desired use, the need for space, etc. Because of this, you should already make an analysis of your future needs long before the lease agreement expires. Time is needed for this, also to negotiate about existing and new lease agreements.’

Legal challenges

Possible legal challenges when making the obligatory label step(s) are tackled by Ploum. Legal discussions are to be expected, according to real estate lawyer Anton van den Heuvel. ‘In practice it is usually the lessor who has to take care of constructive adjustments, such as changing a facade. But replacing lighting is an obligation of the lessee under the model contracts of the Dutch Council for Real Estate (ROZ) and by doing so one or more label steps can sometimes be made as well. If many roads lead to Rome (or Paris in this case), which party is responsible? And what if both parties do nothing, which party then carries the risk after 1 January 2023? He also points out that there is a legal difference between ‘urgent works’ and ‘renovation’, which places the lessee in a different position. ‘It is therefore of the utmost importance that lessors as well as lessees already obtain advice about their (legal) position and enter in consultation with each other, in order to be ready in time. The market does not yet have that awareness sufficiently, while time is really running out’, Van den Heuvel says.

More information about the partnership between Ploum | Rotterdam Law Firm, AREA Occupier Solutions and Facilicom Energy Management is available on www.checkjelabel.nl. Or contact Anton van den Heuvel, Partner and Lawyer at Ploum, via +316 5118 9793 or a.vandenheuvel@ploum.nl.