The future of warehousing, especially those facilities measuring up to 100,000 square feet, faces uncertainty in the wake of new energy efficiency regulations. The report, compiled by property firm Potter Space in association with Savills, highlights a troubling forecast where demand for sub-100k square foot market is anticipated to soar, yet supply struggles to keep pace. This supply-demand mismatch is likely to worsen with the impending Minimum Energy Efficiency Standards (MEES) looming large over the industry.

Critical to this issue is the statutory requirement that by 2027, industrial and logistics facilities must secure an Energy Performance Certificate (EPC) rating of at least C if they are to be let. Potter Space, a stakeholder in the warehousing sector, identified that currently 47% of small to mid-box stock isn’t in compliance with this standard. The challenges compound when considering the 2030 regulation, which mandates an even stricter EPC rating of B. Projections indicate that by this timeline, a staggering 85% of these facilities might not qualify for letting.

Jason Rockett, Managing Director of Potter Space, expressed concern over the unrealistic timelines currently set by the government, which could stifle the operations of essential businesses. “Two years ago, the journey to net zero and the incoming EPC regulations were high on the industry agenda, but this seems to have fallen away,” Rockett remarked. He called for immediate action to ensure the businesses reliant on these facilities can continue their operations sustainably.

There is a consensus among industry leaders on the urgency of revisiting these timelines and providing necessary support. Clare Bottle, the Chief Executive of the UK Warehousing Association, mirrored these sentiments, emphasising the critical nature of sustaining the small to mid-box sector, which serves a vast array of businesses. She advises proactive steps such as reassessing EPCs under revised methodologies and exploring initiatives like LED lighting and rooftop solar installations to meet standards with minimal disruption.

Potter Space advocates for a comprehensive review of the current approach to energy efficiency certification, proposing an integrated plan that includes available funding to assist property owners and occupiers in elevating their buildings to meet compliance demands. Their call to action also extends to refining planning strategies to facilitate development of small to mid-box facilities, alongside larger industrial and residential projects.

The rapidly approaching energy efficiency deadlines necessitate urgent industry action and government reassessment to avert a potential warehousing crisis.

According to financial-news.co.uk