Four-fifths of property companies predict they will fail to meet their growth targets because of soaring energy prices.
Research by Energy Works, a £100m fund to retrofit buildings with energy-efficient LED lighting, shows that 78% of businesses in the property sector believe rising energy costs will hamper their growth, and more than 71% expect to miss their growth targets by as much as 10% this year.
Energy Works, which was co-founded by Harvey Sinclair, a former partner at Matterhorn Capital, surveyed 200 landlords, property companies and facilities managers during October. Respondents were asked about the potential impact of rising energy costs on their businesses and how they expect to mitigate those impacts (graph, attached).
• 78% [of property businesses] say they will not meet growth targets because of rising energy costs
• 71% expect to miss their growth targets by at least 10%
• 52% say energy-efficient LEDs could save them money long term but 86% are yet to make the transition
The findings, seen exclusively by Property Week, reveal that 88% of respondents are “concerned” about the price rises announced last month by four of the UK’s “big six” energy firms: NPower, British Gas, SSE and Scottish Power. A fifth (22%) said they will consider reducing staff headcount as a way of saving money.
Chris Haworth, Director of Energy Works, tells Property Week that, as the property sector – particularly shopping centre landlords – is so reliant on the energy sector, rising prices are alarming and “anything they can do to reduce those costs will help them maintain the value of their assets”.
Of those surveyed, 56% said they will consider introducing green technology to help cut costs. However, although 52% of property companies are aware energy-efficiency measures such as LED lighting could save them money in the long term, 86% have yet to make the transition.