Importance of Understanding Energize Denver in CRE

The Importance of Understanding Energize Denver in CRE

It is important for all to understand what Energize Denver means to them. Whether you are a Tenant, Landlord, Seller or Buyer, please know that in the City and County of Denver, there are specific regulations you will need to follow when it comes to the performance of your building. Energize Denver applies to all commercial and multi-family buildings 5,000 square feet and larger. However, different requirements apply to buildings up to 24,999 square feet and those buildings 25,000 square feet and larger.

Buildings between 5,000 – 24,999 square feet must either upgrade 90% of lighting to LED or install Solar to meet 20% of annual energy use. This must be done by 2028 provided you have filed the simplified timeline extension and met certain criteria on why, which may include no occupancy, other renovations, and more. In addition, it is the owner’s responsibility to report, which must be done between May 1 – December 1 annually. Self-verification is allowed if building owners are already in compliance.

For buildings 25,000 square feet and larger, these buildings must meet Energy Performance Targets by 2032, which targets a 30% reduction from a 2019 energy use baseline. Annual energy benchmarking is required and must be reported and submitted during the reporting period of May 1 – December 1 each year.

So, how does this affect you as a Tenant? A Buyer? Obviously, current Landlords and Owners are affected by the cost to convert their buildings. However, this cost will likely be passed through to tenants depending on what type of lease is in place. It is important to understand your lease, the potential additional rent and/or NNN costs associated with it, etc. Therefore, it is important to understand if the building you are looking at leasing is already in compliance. If not, the likelihood of your costs increasing over the lease term is high. There is a Performance Target Lookup Tool for reference at energizedenver.org, As for Buyers, even though Disclosure Upon Sale is required regarding Energize Denver, be sure and be thorough in your inspections to confirm existing compliance and/or understand what costs you will incur if not currently in compliance. A Buyer should request from the Seller a Compliance Status Letter issued from the City.

The good news is that there are some financial incentives available for those owners who comply. For 2025, there is $20+ million available in rebates for Energy Audits and Efficiency Upgrades. In addition, there are free energy management tools, virtual ASHRAE Level 1 assessments and personalized compliance consulting available. There is comprehensive information, tools and forms as well as a help desk to provide assistance through the City and County of Denver.

These resources can be found at https://denvergov.org and energizedenver@denver.gov.org.