Efficiency First, Then Solar Scales Profitably 🌞

Cut Load Before You Add Megawatts

Author

Anne Morgan
October 01, 2025

In partnership with

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Hello, Commercial Real Estate Pros! 🏢

In this issue, PV Magazine highlights how commercial real estate can thrive by prioritizing efficiency before solar.

Rising electricity demand and tighter ITC timelines are prompting owners to reduce consumption through the use of LEDs, smart controls, and HVAC tuning, while preparing for compliant solar installations.

📰 Upcoming in this issue

  • ☀️ Efficiency First: How Solar Can Thrive in Commercial Real Estate

  • 🏢 What’s Driving Corporate Office Moves

  • 🌇 Office Confidence Returns Amid Uneven Recovery

☀️ Efficiency First: How Solar Can Thrive in Commercial Real Estate

Cutting load before adding kilowatts delivers more substantial returns. The article demonstrates how right-sizing, tariffs, and financing can make projects successful even in volatile interest rate environments.

Key Takeaways:

  • 🧮 Right-Size After Reducing Load: Implement LEDs, controls, and HVAC tuning before installing solar arrays, inverters, and storage, so they are scaled to a leaner baseline.

  • ⚡ Beat Demand Charges: Combine solar with load shifting and batteries to reduce peaks, generate demand response revenue, and stabilize operating costs.

  • 💵 Stack Incentives: Layer ITC adders, depreciation, C-PACE, and PPAs or leases to cut upfront capital and hit target IRRs faster.

  • 🏢 Landlord and Tenant Alignment: Utilize submeters and green leases to share savings transparently, enhancing NOI while advancing ESG and tenant objectives.

🏢 What’s Driving Corporate Office Moves

Tenants are seeking amenity-rich Class A spaces, access to talent, and “just-right” footprints. Siemens Energy’s shift to Lake Nona illustrates how lifestyle-oriented offices lease at nearly twice the pace.

Key Takeaways:

  • 🏗️ Flight to Quality: Companies favor newer, amenity-rich Class A buildings to attract and retain talent.

  • 🗺️ CBD and Suburbs: Both downtown cores and suburban hubs compete, with live-work-play districts commanding 32% rent premiums.

  • 📏 Goldilocks Sizing: Firms rely on badge and login data to optimize space, avoiding empty desks and wasted rent.

  • 📈 Momentum Returns: Net absorption has remained positive for five consecutive quarters, with mid-sized leases accounting for the majority of the activity.

🌇 Office Confidence Returns Amid Uneven Recovery

Foreign investors are returning to Australian offices, despite rising rents and elevated vacancies. Recovery is uneven across markets, with some cities stabilizing faster than others.

Key Takeaways:

  • 📊 Investment Rebounds: $4.4 billion flowed into offices in H1 2025, matching last year’s pace and signaling renewed conviction.

  • 🏙️ City Split: Sydney, Brisbane, and Perth values are steady, while Melbourne is still resetting.

  • 🧱 Supply Squeeze: Limited new projects and high construction costs are driving rents higher, with CBD rates up 3.6% t year over year.

  • 🔮 Sentiment Turns: Surveys now point to rising office capital values over the next 12 months as more buyers return.

Why It Matters

Efficiency creates immediate savings and builds capacity for future electrification. Early action also reduces exposure to fines under Building Performance Standards. With financing options available across many states to cover project costs, owners can act now without straining capital.

Catch you in the next issue,

Anne Morgan
Editor-in-Chief
Commercial Real Estate Weekly

P.S. Interested in sponsoring a future issue? Just reply to this email and I’ll send packages!

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