Changes to the Commercial Building Disclosure Program (CBD) about to take effect

Preston Rowe Paterson’s Property, Asset and Facilities Management team are committed to providing up to date information regarding Regulatory changes in the Property Industry.

As at 1 July 2017, the Commercial Building Disclosure (CBD) Program is undertaking a major change. The program was established by the Building Energy Efficiency Disclosure Act 2010 and is managed by the Australian Government Department of the Environment and Energy.

It is aimed at improving the energy efficiency of Australia’s large office buildings and to ensure prospective buyers and tenants are informed.

Currently the CBD Program requires most sellers and lessors of office space of 2,000 square metres to obtain a Building Energy Efficiency Certificate (BEEC) before the building goes on the market for sale, lease or sublease.

The Australian Government last year announced the mandatory disclosure threshold on commercial office buildings to reduce from the current 2,000 sqm threshold down to 1,000 sqm coming into effect on the 1 July 2017.

What is a Building Energy Efficiency Certificate (BEEC)?

The building’s National Australian Built Environment Rating System (NABERS) Energy for offices star rating which is valid for 1 year, and a (Part 2  from BEEC)– Tenancy Lighting Assessment (TLA) of the relevant area of the building which is now valid for 5 years (since September 2016).

What does this mean to building owners?

Currently as the owner or lessor of a disclosure affected building (of 2,000 sqm) you are required to:

  • Issue a current BEEC to any potential buyers or lessees, as early as possible in the transaction enquiry process or when requested;
  • Provide a Building Energy Efficiency Register so the BEEC is available.
  • Ensure any advertising of the building for sale or lease (including sub-lessor) must contain the building’s NABERS Energy star rating (Part 1 from the BEEC).

What are the Changes?

  • Now Sellers or Lessors of Office Space of 1000 sqm or more are required to obtain a Building Energy Efficiency Certificate (BEEC) prior to offering the property for Sale, Lease (including sub-leases).
  • Additionally, simultaneously leasing more than one floor space in a commercial office building (which may require adding together the net lettable area for those spaces), is more likely to trigger the 1000 square metre threshold.

When?

From 1st July 2017, this expansion of the CBD program comes into effect.

What do I do now?

Currently holding a current valid BEEC is not mandatory under the CBD program unless you are Leasing or Selling your building.

However astute building owners / managers are aware that conducting an annual NABERS rating for their building derives greater benefits other than the mandatory requirements.

In the event that a mandatory disclosure is required for example a sale or lease, the process of applying for BEEC is more timely and efficient when the building owner/lessor holds a current valid NABERS rating.

The documentation required to be gathered by the building owner / manager, and provided to the NABERS Accredited Assessor, is over at least a 12-month operational period.

Therefore in order to hold a valid BEEC as at 1 July 2017, the building owner/agent is required to have the correct building documentation and records dating back to at least July 2016.

For more information you can access fact sheets on line at www.cbd.gov.au or if you think believe the disclosure requirement affects your building this year and have never previously had an accredited NABERS rating, then please contact Preston Rowe Paterson’s Property, Asset & Facilities Management team who can explain the relevant requirements for CBD and NABERS programs.

Contact:

Patrick Cooper

Property, Asset and Facilities

T: 02 9292 7408

M: 0448 656 103

E: patrick.cooper@prpsydney.com.au

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