- Do EPCs need to be provided on sales and lettings and if so, are there any statutory minimum requirements?
- Is there any legislation requiring new or existing buildings to satisfy ESG requirements?
- How widespread are green lease provisions? Are they regulated or market driven? What areas do green leases commonly cover? Do they apply to both residential and commercial leases?
- What do institutional investors and banks/other financing institutions require in terms of the green lease drafting? Is there any market standard approach to green lease drafting? Do you report on the lack of any green lease provisions in your due diligence reports on an acquisition or refinancing?
- How are green lease provisions enforced?
- How widespread is the certification of buildings (e.g. LEED, BREEAM, NABERS, WELL etc.)? Are they regulated or market driven? How is this documented between the Landlord and Tenant?
- Are there any additional regulatory requirements that need to be met or contractual provisions that need to be considered regarding the installation of alternative energy supply systems (e.g. rooftop photovoltaic systems)?
- Are there any regulations relating to soil artificialisation or other biodiversity concerns which impact on new builds and/or refurbishments? How are they enforced?
jurisdiction
1. Do EPCs need to be provided on sales and lettings and if so, are there any statutory minimum requirements?
There are no EPCs in Switzerland. However, there is a building certificate approved by the cantons ("GEAK") which assesses three characteristics: the efficiency of the building shell, the overall energy balance and the CO2 emissions the building causes directly on site (fossil fuels for heating and hot water). Participation in the certificate is not mandatory at the moment but might be in the future.
2. Is there any legislation requiring new or existing buildings to satisfy ESG requirements?
There are different regulations at federal and cantonal level, i.e. different rules will apply to different premises. The respective laws are also constantly changing. At federal level, there are currently requirements to install solar panels on the roofs or facades of new buildings exceeding a certain surface area. At cantonal level, there are differing requirements for new and existing buildings to generate their own electricity, to cover their energy consumption without fossil fuels and on energy efficiency in general.
3. How widespread are green lease provisions? Are they regulated or market driven? What areas do green leases commonly cover? Do they apply to both residential and commercial leases?
Green lease provisions are still rather rare, but are becoming more common. They are usually implemented in commercial leases as they are market-driven and there is no regulatory framework for them. Green lease provisions mostly include cooperation on consumption and other data collection, a joint waste concept, sufficient opportunities for green mobility (e.g. bicycles), purchase of renewable electricity etc. These green lease provisions are typically used for green (e.g. Minergie-labelled [cf. Question 6]) properties.
4. What do institutional investors and banks/other financing institutions require in terms of the green lease drafting? Is there any market standard approach to green lease drafting? Do you report on the lack of any green lease provisions in your due diligence reports on an acquisition or refinancing?
In Switzerland, there is not yet a general market standard for green lease provisions. Hence, green lease drafting highly depends on the individual needs of the parties. Whether we report the absence of green lease provisions in due diligence reports depends on the context.
5. How are green lease provisions enforced?
As there is no regulatory framework for green lease provisions, the enforcement of green lease provisions varies on a case by case basis. It is legally permitted, however not yet common, to provide for contractual penalties in case of breach of green lease provisions.
6. How widespread is the certification of buildings (e.g. LEED, BREEAM, NABERS, WELL etc.)? Are they regulated or market driven? How is this documented between the Landlord and Tenant?
There is the Minergie-label which is the Swiss building standard for comfort, efficiency and climate protection. This applies to both new buildings and renovations, as well as to both residential and commercial buildings. The Minergie-label especially considers the building shell and its air exchange. Minergie buildings are also characterised by the consistent use of renewable energies and by using the potential of solar energy. They are CO2-free in operation and minimise greenhouse gas emissions during construction. The Minergie-label is quite common in Switzerland for new buildings and renovations (roughly 15 % of new buildings and 2 % of renovations are Minergie-labelled). International building certificates such as e.g. LEED, BREAM etc. are less frequently applied. All these certificates / labels are market driven and are typically mentioned in the relevant lease agreements.
7. Are there any additional regulatory requirements that need to be met or contractual provisions that need to be considered regarding the installation of alternative energy supply systems (e.g. rooftop photovoltaic systems)?
From a regulatory point of view, the requirements for obtaining subsidies or similar must be taken into account, as well as the fact that different building permit procedures apply depending on the installation in question. From a contractual point of view, a wide variety of contractual arrangements are possible (e.g. depending on who installs such systems, who owns them, who uses the energy, etc.).
8. Are there any regulations relating to soil artificialisation or other biodiversity concerns which impact on new builds and/or refurbishments? How are they enforced?
Yes, such regulations exist. With regard to new buildings / refurbishments, these will be addressed in the context of cantonal building permits. Soil protection measures can include, for example, documentation requirements, the use of clean and diverse soil material etc. They are enforced by the building permit otherwise not being granted or being withdrawn. Non-compliance can also result in administrative fines.
