Investing in sustainable features increases the market value of shopping centres in the UK over 5 per cent, according to new research from the British Council of Shopping Centres and its research partner CBRE, the global real estate advisor.
The research, undertaken by CBRE, spanning 35 UK shopping centres utilises valuation modelling to investigate the dynamic between energy efficiency, and associated costs, versus shopping centres’ asset value in relation to the premature scrapping of high energy equipments and replacement with new energy efficient kit. The concept is designed to decipher the impact on rents and yields for occupiers and owners of shopping centres, coupled with highlighting energy risks and driving sustainability awareness.
The results, which are backed by EU data, are most pronounced for older shopping centres (those over 25 years old) with potential gains of over 5 per cent. For an average £100m shopping centre in the UK, this translates into a new market value of at least £105m when energy-intensive equipment is replaced with new apparatus that offers energy-saving features as standard. For relatively modern centres (less than 5 years old) the analysis shows a value gain of over 1 per cent would be realisable. In essence, failure to undertake energy efficient investments, in whole or in part, would risk effective loss of value of £5m.