New energy efficiency disclosure requirements for commercial buildings

A new piece of Federal legislation, the Building Energy Efficiency Disclosure Act 2010 (BEED), introduces new disclosure requirements for some owners of commercial buildings. BEED comes into effect on 1 November 2010.

Buildings affected

To come under the legislation, a building (or part of the building) must have a net lettable area of at least 2,000m2 and the net lettable area must be used for administrative, clerical, professional or similar information-based activities.

However, a building will not be affected if it (or the relevant part of it) is newly constructed or has undergone major refurbishment and a Certificate of Classification or Certificate of Occupancy has been issued within the past two years or the building (or the relevant part of it) is part of a body corporate structure.

The disclosure requirements will also not affect leases or subleases of 12 months or less (including any option period).

What must be disclosed?

The owner or tenant of an affected building will need to produce a Building Energy Efficiency Certificate (BEEC). The BEEC will have three parts:
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  1. an energy efficient rating for the building (or relevant part);
  2. information about the energy efficiency of the lighting within the building (or relevant part); and
  3. general energy efficiency guidance.
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When disclosure must be made

The owner or tenant of an affected building will need to register the BEEC with the Building Energy Efficiency Register before it offers to sell or lease the building (or part of it). Prospective buyers or tenants will be able to review both past and present BEECs using the online registry.

Further, the BEEC must be disclosed in all advertising material and on request to all prospective buyers and tenants.

Finally, further encroaching on valuable advertising space, any advertisement for the sale or lease of an affected building (or part of it) will have to disclose the National Australian Built Environment Rating System (NABERS) star rating.

Penalties

There are significant fines of up to $110,000 for failing to register a BEEC or failing to meet the advertising requirements.

Conclusion

If a building can obtain a NABERS rating prior to 1 November 2010, it will only need to disclose this rating until 31 October 2011. Otherwise a full BEEC will need to be disclosed.

BEED represents another regulatory burden upon commercial property owners and agents who represent owners in the sale or lease of buildings. For further information on this legislation and how it affects you, please contact Certus Legal Group.

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