Published On: September 16th, 2014 / Categories: energy Usage /

Energy usage of nonresidential buildingsEnergy usage of nonresidential buildings can be an unknown and hidden cost of ownership when contemplating a commercial real estate deal. The California Nonresidential Energy Use Disclosure Program (AB 1103) was supposed to introduce transparency into these transactions, mandating the benchmarking of energy use as well as the disclosure of such information at least 24 hours before a sale, lease or refinancing of a California nonresidential building is finalized.

Now, however, the California Energy Commission has issued an emergency rule delaying the enforcement of this requirement on buildings between 5,000 and 10,000 sq. ft. until July 2016.

The staged enforcement of this new disclosure requirement tracks to building size:

  • Stage One: Starting July 1, 2013, for a building with total gross floor area measuring more than 50,000 sq. ft.
  • Stage Two: Starting January 1, 2014, for a building with a total gross floor area measuring more than 10,000 square feet and up to 50,000 square feet.
  • Stage Three: Starting July 1, 2016, for a building with total gross floor area measuring at least 5,000 square feet and up to 10,000 square feet.

This new requirement, when fully implemented, will require coordination with the Energy Star website, implementation of a 30-day benchmarking process, and the preparation of a report to the interested parties in the real estate transaction. Since this process requires a full 30 days of data collection, property managers would be prudent to become familiar with this process, and complete this benchmarking process early in the sales, leasing or refinancing process.

Sign up for updates

Never miss a post. Get on the mailing list to be informed.

  • Hidden
    MM slash DD slash YYYY
  • This field is for validation purposes and should be left unchanged.