While net zero remains a core ambition, the market is taking a more pragmatic, commercially driven view shaped by operational realities, tenant expectations and deliverability. With most of the buildings that will exist in 2050 already standing, the focus is now firmly on improving existing assets rather than relying on new development.

Industrial and logistics

In the industrial and logistics sector, retrofit is driven by operational performance, occupier needs and regulatory compliance. While EPC improvement remains a key trigger, interventions are typically aligned with lease events, hold strategies and planned refurbishments.

Project viability rarely supports detailed, asset by asset energy modelling. Instead, owners often adopt EPC-led “shopping lists” targeting low disruption, high impact measures that improve ratings and reduce regulatory risk, even if they fall short of an optimised net zero pathway.

Electrification is therefore phased. Office and ancillary spaces are prioritised, while warehouse strategies respond to occupier operations and available power. Alongside this, smarter metering and monitoring are being deployed to improve visibility, inform investment decisions and strengthen resilience.

Offices and retail

In offices and retail, retrofit remains closely tied to achieving EPC A and B ratings and progressing towards all electric buildings. Capital deployment is increasingly disciplined, with investors prioritising measures that protect income, support leasing and maintain liquidity.

The market is moving away from wholesale plant replacement towards targeted optimisation and selective upgrades. Many assets can achieve meaningful reductions in energy use and carbon without immediate full electrification. Where early replacement of gas plant is not viable, systems are retained to end of life and supplemented with bivalent solutions. This enables managed reductions in gas use, supports gradual integration of heat pumps and electrical upgrades, and creates a credible pathway to full electrification. Crucially, it allows phased, performance-led investment aligned to asset strategy, avoiding premature or stranded expenditure.

Occupied retrofit is also proving its value. At Moor House, a central London office building, Savills delivered a phased upgrade programme around tenants, avoiding voids and protecting income. Strong tenant engagement supported both retention and reletting while enabling progressive performance improvements, demonstrating a commercially deliverable route.

The future of retrofit

Deep retrofit will not be universal. While it suits prime assets in the right context, much of the market will require more flexible, capital efficient pathways.

Three areas are gaining focus: alignment of gas and electricity pricing to strengthen the case for electrification; battery storage to support resilience and peak management; and on site renewables and UK based offsetting to provide more controllable decarbonisation routes.

Buildings do not fail to decarbonise due to lack of intent, but where solutions do not work commercially, physically or operationally. Successful retrofit is viable, phased and grounded in reality. While deep retrofit can require 8 - 12% of asset value, it can deliver strong returns in supply constrained markets where efficient space commands a premium.

Retrofit is no longer a standalone sustainability exercise. The most effective strategies align environmental performance with commercial outcomes, protecting income and supporting long term asset liquidity. As expectations evolve, success will be measured not by ambition alone, but by the value delivered.

Further information

Contact Matthew King

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