Offices · Landlord-funded

Published 2026-04-01 · By Commercial Solar Finance editorial team

London multi-let office: 240kWp landlord-funded with green-rent uplift

A 240kWp solar deployment on a four-tenant City of London office building. Landlord funded 85% of capex with green-rent uplift on three of four tenants; the fourth tenant contributed £35k toward fit-out integration in exchange for direct electricity offtake. Structure resolved the multi-let landlord-tenant split that had blocked the project for three years.

Sector

Offices

Structure

Landlord-funded with green-rent + tenant capex contribution

Capital

£195k landlord; £35k tenant fit-out

Saving year 1

£68k year one across building

Project overview

A four-tenant City of London office building (£12m valuation, 4,800m² NIA) deployed 240kWp solar across the south-facing roof zones in 2025. The deployment had been blocked since 2022 by classic multi-let landlord-tenant split — landlord owned the roof and capex burden; tenants paid the electricity bill and would capture the saving. The resolution combined three structural innovations: green-rent uplift on three tenants, a direct-offtake fit-out arrangement with the fourth tenant, and a shared-savings clause that distributed surplus generation revenue.

The challenge

Multi-let buildings have killed more commercial solar projects in central London than any other single factor. This building had been considered for solar by three previous owners. Lease structures had no provisions for capex pass-through, no provisions for solar deployment in service charge, and no green-lease language anywhere in the tenant agreements. Tenants had no incentive to fund capex on landlord property; landlord had no incentive to fund capex without rental return. The previous owners walked away each time.

Structure and economics

New landlord acquired the building in 2024 with refurbishment intent. The acquisition strategy included solar deployment as part of EPC C uplift (current rating D) for MEES compliance. Lease renegotiation strategy: three tenants accepted 0.85% rent uplift on base rent in exchange for solar-supplied electricity at grid rate (the tenants benefit through ESG positioning rather than direct electricity discount). The fourth tenant (a tech occupier needing solar credentials for client RFP responses) negotiated direct-offtake at 4p/kWh below grid in exchange for £35k capex contribution to dedicated metering and routing infrastructure. Total tenant contributions covered 18% of landlord capex.

How we got there

  1. Step 1

    Q1 2024: Acquisition complete. Solar deployment scoped as part of broader £2m refurbishment programme.

  2. Step 2

    Q2 2024: Tenant engagement on lease renegotiation. Strategy: present solar as ESG-positioning benefit rather than electricity-cost saving. Three of four tenants engaged constructively from start.

  3. Step 3

    Q3 2024: Lease renegotiation completed across three tenants with green-rent uplift provisions. Fourth tenant negotiated separately on direct-offtake structure.

  4. Step 4

    Q4 2024: DNO connection study and structural assessment. G99 application submitted. Project tendered to three EPC contractors.

  5. Step 5

    Q1 2025: Construction begins on south-facing roof zones. Phased to minimise tenant disruption.

  6. Step 6

    Q2 2025: Commissioning across all sub-arrays. Monitoring portal live with sub-array-level breakdown.

  7. Step 7

    Q3 2025: First full quarter of operation. Year-1 modelled saving £68k across the building, with £18k split to landlord (green rent) and £50k split across tenants (electricity savings + ESG positioning).

Outcome

Year-one combined building electricity saving £68,000. Landlord captures £18,000 through green-rent uplift on three tenants; tenants split £50,000 of electricity savings and ESG positioning value. EPC rating moved from D to C, supporting MEES compliance through 2030 horizon. Building valuation increased materially through both EPC uplift and solar-equipped premium — building agents now market the building as "EPC C, solar-equipped" with notable rent-roll uplift on subsequent tenant churn.

What this case taught us

  • Multi-let landlord-tenant solar deployment is structural, not financial. The lease drafting matters more than the system specification — green-rent provisions, fit-out cost allocation, change-of-tenant continuity all need careful drafting.
  • EPC and MEES compliance pressure is meaningfully accelerating commercial-property solar deployment. Buildings approaching MEES thresholds are increasingly funding solar as part of broader EPC uplift programmes.
  • Direct-offtake arrangements with single tenants can resolve solar economics where green-rent doesn't. Tech-sector tenants particularly value direct solar provenance for client ESG reporting and respond well to fit-out cost-sharing arrangements.

Project profile that looks similar to yours?

We model the same structures against your specific numbers — postcode, half-hourly demand, accounting position, balance sheet preferences. Five working days from enquiry to indicative case.

Request a finance review