The Green Lease agreement: sustainability in real estate

Sustainability is an important and topical issue in the real estate sector. The European Green Deal, for example, has led to a flood of new sustainability legislation. Most homes and non-residential buildings (such as offices, schools, or hospitals) require an energy label when sold, rented, or delivered. Since January 1, 2023, most offices may no longer be used if they do not have at least an energy label C. As a result, there are various issues in tenancy law that need to be addressed; for example, who is responsible for complying with the energy label requirement, the tenant or the landlord? And which party risks enforcement by the municipality? What if investments need to be made in the rented property, what are the consequences for a current lease agreement?

Green Lease

Popular concepts such as Green Lease and ESG are therefore also finding their way into real estate. For a number of years now, the Real Estate Council has included extensive sustainability provisions in its model lease agreements. If far-reaching sustainability agreements are included in a lease agreement, it is referred to as a “Green Lease.” Such agreements make the landlord and tenant jointly responsible for the successful sustainability of the leased property, with the emphasis on shared responsibility. This involves, for example, the distribution of the costs and revenues of the necessary sustainability measures, whereby the parties are encouraged to apply sustainable practices within the leased premises in accordance with ESG principles. Real estate financiers are also increasingly imposing ESG criteria.

It is clear that including agreements on sustainability can offer concrete benefits that can no longer be ignored and, in fact, offer opportunities that lead to win-win situations.

Advice

There is currently so much happening in the field of energy transition that careful consideration must be given to this when entering into and renewing lease agreements. These are natural moments at which such agreements can be included in the negotiations. Do you have questions about sustainability in tenancy law or do you have other legal questions about tenancy law? Our specialized attorneys are happy to assist you. You can contact them by phone and / or e-mail.