Still Running on Yesterday? Here’s What That Buys You.
Still Running on Yesterday? Here’s What That Buys You.
1. Operating Costs Keep Increasing
Older mechanical, lighting, and building systems use far more energy. Without upgrades:
Utility bills rise year after year
Equipment runs inefficiently and breaks down more
Maintenance costs increase as parts become harder to find
Over a building’s life, this can mean tens or hundreds of thousands of dollars in avoidable expenses.
2. Decreased Equipment Lifespan
Outdated equipment works harder to provide the same output. Over time this leads to:
More frequent repairs
Shorter system life
Emergency replacements instead of planned investments
Emergency replacements cost much more and cause disruptions.
3. Poor Indoor Air Quality (IAQ) & Occupant Comfort
When buildings don’t upgrade:
Air distribution declines
Humidity becomes harder to control
Ventilation rates may drop below modern standards
Temperature becomes inconsistent or uncomfortable
This results in tenant complaints, increased sick days, and a negative perception of the building.
4. Lower Tenant Satisfaction & Higher Turnover
Tenants increasingly expect buildings to be efficient, comfortable, and modern.
If a building stays outdated:
Tenants may demand rent concessions
Competitors with efficient buildings attract higher-quality tenants
Vacancy rates increase
This directly reduces NOI (net operating income) and property value.
5. Falling Property Value
Inefficient buildings are viewed as “money pits.” Buyers and investors discount them because they know:
Future retrofit costs will be high
Utility bills are unnecessarily steep
Systems may be near failure
An outdated building can lose 10–30% of market value compared to efficient competitors.
6. Increased Risk of Code Non-Compliance
Building codes for energy and ventilation become stricter every few years.
Without upgrades, a building may:
Fail inspections
Be subject to fines in cities with benchmarking or carbon laws
Become non-compliant with ASHRAE or IECC standards
Face future mandatory retrofit requirements
This risk is growing, especially in major cities.
7. Higher Carbon Footprint & Poor Sustainability Rating
Without energy-efficiency improvements:
The building’s emissions stay high
It fails to meet ESG (environmental, social, governance) expectations
It cannot earn certifications like LEED or ENERGY STAR
Companies may avoid leasing space because their own sustainability goals are impacted
This can affect long-term competitiveness.
8. More Frequent System Failures
Old mechanical systems struggle under high loads. Over time this can lead to:
HVAC shutdowns during peak heat or cold
Server room overheating
Water damage from old plumbing
Long tenant downtime
Unplanned failures cost much more than proactive upgrades.
9. Health and Safety Risks
Aging mechanical systems can contribute to:
Mold growth from poor humidity control
Poor ventilation (stale air, CO2 buildup)
Increased risk of CO leaks from old gas systems
Fire risks due to electrical strain
These risks increase liability for owners.
10. Falling Behind in Market Expectations
Modern tenants—especially tech, medical, education, and corporate firms—expect:
Smart building controls
Energy-efficient lighting and HVAC
Healthy indoor air
Sustainability transparency
Failing to upgrade pushes a building out of the competitive market.
