For landlords, developers and investors, installing EV charging infrastructure can:
- Support ESG and government objectives
- Enhance the attractiveness of a property to prospective tenants and occupiers
- Future-proof property portfolios against changing occupier requirements
- Create potential additional revenue streams
- Help satisfy regulatory requirements.
The benefits may be particularly apparent in the retail sector, where EV charging facilities can attract drivers to a site, increase footfall and encourage customers to spend longer there.
Demand is also being driven by regulation. Under Part S of the Building Regulations, certain new and renovated non-residential buildings must provide EV charge points and associated cable routes. Government support also remains available through the Workplace Charging Scheme, which has been extended until 31 March 2027.
Against this backdrop, landlords and developers should consider the commerciality of EV charging infrastructure. Properly documenting installations and the rights associated with them can help avoid disputes and costly complications in the future.
Key issues for landlords and tenants
Existing lease terms
The starting point for any proposed installation will usually be the existing legal documentation, including leases and any rights affecting the property.
Many commercial leases restrict a tenant's ability to carry out alterations without landlord consent. Installing charging points may require:
- Landlord consent under an alterations clause
- A licence for alterations
- Additional rights to run cables through the property or common parts.
Landlords should also consider whether existing tenants have rights over parking areas that could affect the location of charging points.
Where a tenant installs charging infrastructure, the parties may also need to consider responsibility for maintenance, removal and reinstatement at the end of the lease.
Rights over parking spaces
Where charging points are to be installed in shared or allocated parking areas, consideration should be given to existing rights granted to occupiers.
Issues may include:
- Whether parking spaces are allocated or shared
- Whether existing easements or rights of way are affected
- The extent of any rights needed for maintenance, repair and access.
These issues can be particularly complex in multi-let buildings or developments, where several occupiers may have competing rights or expectations regarding parking and access.
Electricity supply and infrastructure capacity
Before installing EV charging points, landlords and tenants should consider whether the property's existing electrical infrastructure has sufficient capacity.
Upgrades may be required where multiple charging points are proposed, particularly at larger commercial or multi-let sites. The parties should consider who is responsible for arranging and funding any necessary works, as well as how electricity consumption will be metered and charged.
Planning for future capacity at an early stage may also help avoid the need for more extensive and costly works as demand for EV charging increases.
Building regulations and compliance
EV charging infrastructure is not only a commercial requirement, in some cases it is also a regulatory requirement.
Under S4 of Part S of the Building Regulations:
- New non-residential buildings with more than ten parking spaces must provide at least one charge point and cable routes for at least 20% of parking spaces
- Commercial properties undergoing major renovation, where the building has more than ten parking spaces, may also be required to meet similar standards
- Charge points must comply with applicable technical and smart charging requirements.
Ensuring compliance at an early stage can help avoid delays and additional costs later in the development process.
Working with charge point operators
Rather than owning and operating charging infrastructure themselves, some landlords may choose to partner with a specialist charge point operator.
This can involve:
- Granting a lease or licence over part of the site
- Entering into revenue-sharing arrangements
- Providing rights for installation, operation and maintenance.
The commercial structure should be carefully documented to ensure that responsibilities and liabilities are clearly allocated to the relevant parties.
Service charge considerations
Where charging points serve a multi-let building, landlords may wish to recover associated costs through the service charge.
Potential costs include:
- Installation and infrastructure upgrades
- Maintenance and repair
- Insurance
- Management and administration expenses.
Whether these costs can be recovered will depend on the wording of the service charge provisions in existing leases. Landlords should distinguish between initial capital expenditure and ongoing operating costs, as different service charge provisions may apply.
Future-proofing new leases
When granting new leases, landlords may wish to address EV charging infrastructure expressly rather than dealing with the issue only when a tenant requests permission to install equipment.
For example, leases could include provisions dealing with:
- The installation of future charging points
- Allocation of charging spaces
- Responsibility for electricity consumption
- Cost recovery mechanisms
- Ownership of tenant-installed equipment
- Reinstatement obligations
- Rights to upgrade infrastructure as technology develops.
Leases may also need to preserve sufficient flexibility for landlords to install or expand charging infrastructure in common areas as occupier demand changes.
Addressing these points at the outset can reduce the need for further negotiations later.
How TWM can help
Our Commercial Property team can advise landlords, developers and tenants on all aspects of EV charging infrastructure including:
- Reviewing lease provisions and occupier rights
- Preparing and negotiating licences for alterations
- Drafting deeds of easements and rights relating to cabling, access and maintenance
- Advising on service charge provisions and cost recovery
- Negotiating and documenting arrangements with charge point operators
- Advising on the property implications of compliance with Building Regulations
- Drafting lease provisions to accommodate future EV charging requirements.
If you are considering installing EV charging points at your commercial property, or would like advice on how proposed infrastructure could affect existing lease arrangements, please get in touch with our Commercial Property team.
This article was co-authored by Trainee Solicitor, Shakiba Bazli, while working in the Commercial Property team.