HOW TO POWER BUILDINGS FOR NET-ZERO FUTURE

HOW TO POWER

BUILDINGS FOR A NET ZERO FUTURE

A practical guide to building electrification

We are custodians of the built environment, and we drive progress by moving beyond the status quo. We deliver meaningful, measurable improvements. We cut through aspirational targets with a practical, outcomes-focused approach. We help clients take clear, actionable steps that improve the sustainability, performance, and resilience of their assets and portfolios. By taking action, we can ensure a better future begins now. BETTER BEGINS NOW

PUT YOUR BUILDING ON TRACK FOR A NET-ZERO FUTURE

So electrification is essentially another way of saying “removing fossil fuels” starting with on-site activities and ultimately leading towards renewable electricity. As climate-related financial disclosures and emissions reporting obligations gain traction globally, new regulations are increasing risk exposure across real estate portfolios. At the same time, internal reduction targets and tenant expectations are reshaping asset strategies. Asset managers and facility teams must act early to assess exposure and plan for capital works that align with emerging compliance pathways and performance requirements. Electrification is central to this shift. It directly links to building performance fundamentals, including energy data integrity, load reduction, renewable energy integration, and long-term emissions control. Owners who understand these interdependencies can phase upgrades strategically—based on asset condition, timing of risk, and value potential—rather than responding reactively to regulation or failure. As a real estate advisor, Cushman & Wakefield plays a pivotal role in supporting owners and occupiers throughout the electrification journey. This guide provides a structured, practical roadmap that clarifies key phases, decision points, and stakeholder roles, helping you move from strategy to delivery with confidence.

Electrification is no longer a future consideration—it is a current planning priority.

To achieve net-zero operational greenhouse gas (GHG) emissions, properties must decarbonize, or reduce the GHG emissions associated with operations. Electrification is an important component of a planned pathway to achieve net-zero emissions. Electrification alone does not result in a net-zero building, as consideration needs to be given to the emissions associated with the electricity grid. Having an electric building; however does enable a transition to renewable electricity sources. In simple terms, electrification involves removing fossil fuels, such as natural gas or diesel, from use in a building, and replacing them with electrically-powered equipment. Why? Fossil fuels are not compatible with future-ready buildings, based on evolving building codes, green building certifications, regulations, and macro-level shifts to phase out fossil fuel use. Having an all-electric building also enables a transition to renewable electricity sources, such as on- or off-site solar. Removing gas and other fossil fuels from on-site operations is critical, as there is no large-scale solution for renewable gas or renewable diesel— these alternatives simply do not exist—but renewable electricity can fill the gap.

FROM POLICY TO PAYBACK THE PUSH TO ELECTRIFY

Electrification is now a critical enabler of asset value and compliance—not a future aspiration but a current operational priority.

REGULATORY PRESSURES

INVESTOR AND TENANT EXPECTATIONS Sustainability demands from investors and tenants are pushing owners to prioritize low-carbon, high performance buildings.

Stricter building codes and emissions standards are forcing owners to track energy use and meet carbon reduction targets.

Across global real estate markets, asset managers and facilities teams face intensifying pressure to decarbonize. Tenant expectations are rising, green leases are tightening, and building rating schemes are evolving to favor electrified systems. Capital markets are increasingly factoring emissions performance into asset valuations. Electrification has emerged as one of the most scalable and practical pathways to reduce emissions and future-proof buildings. It enhances operational efficiency, improves indoor environments, and positions assets to meet regulatory and market expectations. Electrification is accelerating as regulatory pressure, investor scrutiny, tenant expectations, and technology costs converge to reshape capital planning. For commercial buildings, this transition is already underway. Industrial and retail assets will follow, driven by increasing disclosure requirements and tenant pressure. Owners must act now to assess their readiness, identify potential implementation risks, and align electrification efforts with their capital planning cycles. Delaying action increases the risk of stranded systems, non-compliance, and declining competitiveness.

NET-ZERO THROUGH BUILDING ELECTRIFICATION

TECHNOLOGY ADVANCEMENTS Emerging solutions like heat pumps, smart systems and on-site storage are making electrified, efficient buildings more feasible.

CHANGING ECONOMICS Falling electrification costs, rising gas prices and new incentives are making electric upgrades more affordable and attractive.

RAISING THE ACCOUNTABILITY STAKES

As part of the tightening global regulatory landscape, commercial buildings are subject to a broad range of local and national regulatory frameworks. Some of these apply directly to electrification and others are more generalized . This growing momentum runs in parallel to a broader shift towards mandatory sustainability reporting at an organizational level, extending checks and balances to individual buildings. Together, it’s part of aligning building performance with company, then city, and national net zero commitments. Here is just a snapshot of active initiatives worldwide:

Local Law 97 (LL97) Strict emission limits for most NEW YORK CITY, US buildings over 25,000 square feet with cap-and-penalty per tonne of carbon over limit.

Building Emissions Reduction and Disclosure Ordinance (BERDO) Mandated emissions limits for existing large buildings over 20,000 square feet with reporting requirements and penalties. BOSTON, US

Carbon cap-and-penalty program TORONTO, CANADA Emissions caps for existing large buildings over 50,000 square feet with financial penalties for non-compliance.

EUROPEAN UNION

Minimum Energy Efficiency Standard (MEES) Tightening regulations outlining penalties for leasing commercial buildings that do not meet minimum EPC standards. UNITED KINGDOM

FRANCE

Energy Performance of Buildings Directive (EPBD) Mandated deep upgrades of inefficient buildings and net-zero grade standards for new builds across EU members.

Décret Tertiaire

Outlines that commercial buildings over 1,000 square meters must reduce energy use by 40% by 2030 with mandatory reporting.

SINGAPORE

AUSTRALIA

Cap-and-trade program TOKYO, JAPAN

Green Mark Incentive Scheme & Building Control Act Mandated sustainability standards for large new and upgraded existing buildings with penalties connected to building approvals.

NABERS and commercial building disclosure (CBD) National energy rating scheme underpinning mandatory efficiency disclosure at sale or lease and informing emerging state-level emissions caps.

Mandating carbon intensity reduction for existing large commercial buildings with tradeable carbon credits and compliance monitoring.

Electrification is a multi-phase investment that must be integrated into capital planning, aligned with leasing renewals, and major equipment replacement cycles, For asset managers and facilities teams, success depends on early stakeholder mapping and coordination. The building owner drives approval and financing. Asset and facilities managers work closely with tenants to minimize the operational impact. Engineers, consultants, and contractors deliver the technical pathway, while regulators, utilities, and vendors shape the external conditions, including policy, incentives, and grid readiness. Clarifying these roles early helps turn energy audits and net-zero roadmaps into actionable asset plans. Cushman & Wakefield enables clients to structure this journey, integrating technical, financial, and stakeholder inputs into a coordinated delivery plan.

Building Owner Primary decision maker, accountability for approval, financing and long-term value.

JOURNEY

Core participants including Asset Managers, Facilities Managers, Tenants Directly involved in the management, operation and usage of building systems and services.

Technical delivery partners including Engineers, Consultants, Contractors Translate objectives into systems and infrastructure. Influence cost, feasibility, timelines and compliance.

WHERE TO START

Context setters and enablers including Utilities, Regulators, Investors, Vendors Provide the external conditions that shape the settings and environment for electrification, such as policy, supply chains, approvals, incentives, and capital.

YOUR ELECTRIFICATION

1

Electrification isn’t a one-time initiative—it’s a phased capital program that must align with leasing cycles, lifecycle planning, and asset strategy. These four steps provide a practical framework to help asset managers and facilities teams move from ambition to execution. By applying these steps—prioritizing action, reducing demand, planning investment, and delivering upgrades—you can accelerate toward net zero, manage risk, and reduce long-term energy costs. Early action also positions your assets to remain compliant, resilient, and competitive as rating schemes and tenant expectations evolve. FOUR STEPS TO ELECTRIFY YOUR BUILDING

2

3

4

BASELINE ENERGY USE AND BRING IT DOWN STEP 1

The first step on the building electrification journey is to establish a building performance baseline. This begins with a solid data foundation, built from energy audits, emissions benchmarking, and detailed asset condition reporting. This helps you understand how your base-building systems are performing, especially when combined with lifecycle assessments and total energy use analysis compared to high-performance standards. That clarity is essential for identifying opportunities and setting priorities. Focus on quick wins for load reduction and operational efficiency Reducing energy demand at this stage has a twofold benefit. First, it decreases immediate energy use, and then, it lowers both capital and operational costs during the electrification phase and beyond. No- or low-cost operational strategies can be implemented quickly and with minimal disruption to deliver immediate reductions in energy intensity with shorter payback periods. This can range from simple measures, such as shutting off or slowing down energy use and avoiding simultaneous cooling and heating, to utilising intelligent and automated building systems to replace manual tasks. Common examples include: BASELINE ENERGY USE AND BRING IT DOWN STEP 01

Encouraging behavior change through tenant engagement.

Adjusting HVAC temperature setpoints and widening deadbands to prevent continual switching between heating and cooling.

Modifying schedules based on occupancy.

Implementing night setback programming and seasonal tuning.

Enabling demand response, where available.

RETURN

GET BUDGETS AND MODELS IN PLACE STEP 2

GET BUDGETS AND MODELS IN PLACE STEP 02 Once you’ve addressed low- or no cost operational measures, the next step is building the business case for more substantial upgrades. This means putting the right models, budgets and planning frameworks in place to support electrification. At this stage, you’re looking to identify viable pathways, assess the cost-benefit of different options, and begin shaping a phased retrofit roadmap that aligns with your technical readiness, capital cycles and organisational goals.

To move electrification plans forward, you’ll need to model scenarios, prioritize investment and understand payback timelines. This includes forecasting energy savings, cost savings, emission reduction impact and capital expenditure commitments. Then identifying funding sources, whether through internal budgets, green financing, local or regional government incentives, or utility programs. Engaging early with utility providers can also help align infrastructure upgrades, manage grid impacts, and unlock additional support. Given the often long lead times for network upgrades and connection approvals, early coordination is essential to keep electrification plans on track. With a clear data backed plan in place, you’re ready to take on more significant capital efficiency upgrades that reduce energy use and prepare your building for full electrification.

ELECTRIFICATION PRIORITISATION MATRIX

TACTICAL UPGRADES Low effort Lower impact

QUICK WINS Low effort High ROI

Ease of implementation

DEFERRED UPGRADES Revisit later

STRATEGIC PRIORITIES High effort High ROI

Impact potential

RETURN

MOVE FROM STRATEGY TO ACTION STEP 3

MOVE FROM STRATEGY TO ACTION STEP 03

With a baseline and audit complete, and a budget in hand, the next step is to move toward implementation. First, start by reviewing your capital works process and timelines for your building, particularly the remaining life on any fossil-fuel powered equipment that will be replaced. A gas boiler with a few years of useful life may not need to be replaced immediately, unless you are under time pressure to accelerate your progress. By planning a year or so ahead, you can phase capital expenditure over time, avoid big spikes in costs, and minimize disruption to tenants or other building projects. Think as well about the physical elements of executing these projects – how will the old equipment be removed from site and will the new equipment go into the same location? Do you need to plan for road shutdowns, or notification

of tenants? Often it makes sense to replace boilers during the summer when there is less need for heating. Replacing gas equipment that is used for cooking or other ongoing needs may need to be planned differently. Depending on the scale of these changes, it may require investigation of not just fossil fuel using equipment like gas boilers, but wider considerations of electrical infrastructure or electricity supply arrangements. Does the current electrical switchboard have capacity for the new equipment? Does your electricity contract include peak demand charges, and how will these be impacted by the changes you are making? The benefit of starting early is you have time to work through these issues and come up with a simple and practical solution.

EASE OF IMPLEMENTATION Which assets are high-performing and could benefit quickly from low-cost interventions?

RETURN ON INVESTMENT

GRID AND UTILITY INTERFACE

Which properties offer the best payback through energy savings, valuation uplift or avoided regulatory penalties?

Are there constraints in grid capacity or upgrade timelines that may delay implementation in certain regions?

TENANT AND LEASE CONSIDERATIONS Which buildings have cooperative tenants or lease structures that enable upgrades with minimal disruption?

LIFECYCLE ALIGNMENT

RESILIENCE Which properties would benefit from increased operational continuity or on-site energy flexibility through electrification?

Are there buildings where major plant or HVAC systems are already nearing end-of-life, creating a natural entry point?

The limits to electrification: Some fuel uses are harder to address. For example, diesel-powered fire and life safety systems are required under certain building codes—this is not the ideal starting point for your electrification journey and may need to be revisited down the track.

Overcome inertia: Don’t assume that a like-for-like replacement is the best route - with plant lasting 20 years, review your options now to prepare for the future.

RETURN

BUILD FOR NET ZERO STEP 4

BUILD FOR NET ZERO STEP 04

Electrification should happen concurrently with broader energy efficiency projects. Reducing demand makes electrification less costly. With a compelling business case, funding and clear priorities, it’s time to move into execution, starting with capital-efficiency upgrades that reduce demand while improving comfort and performance. Once you’ve reduced energy demand, you can start planning the phased replacement of fossil fuel-based systems

with electric alternatives. Here, it’s worth remembering that advancements in technology mean that electric alternatives are as good or better than traditional systems. This means you don’t have to sacrifice building comfort, quality or air quality. The best approach to both will depend on your building’s type, local climate, infrastructure limits and available budget, but there are proven steps you can take, including:

Replacing gas-fired boilers and furnaces with air- or ground-source heat pumps Electrifying hot water systems using heat pump water heaters Swapping out gas cooking appliances with induction technology

LED lighting retrofits

Automated lighting and HVAC controls, measures including occupancy sensing, timeclocks and daylight harvesting Envelope enhancements such as sealing or insulation upgrades Replacing variable refrigerant flow systems with lower global warming potential refrigerants Upgrading advanced building controls or building management systems

Upgrading ventilation and distribution systems to support new HVAC loads

PROJECTS

Integrating on-site renewables (e.g. solar PV) into designs

EFFICIENCY

UPGRADES &

IMPROVEMENTS

ELECTRIFICATION

As you implement your strategy, continuously monitor performance data to identify what worked well, determine opportunities for replication across your portfolio, and close the performance gap. Even with electrification and efficiency upgrades, most buildings will still need external solutions to achieve true carbon neutrality. On-site renewable energy should be added where feasible, along with electrified backup systems. Battery storage and other distributed energy technologies can improve grid responsiveness and reduce fossil fuel use during peak demand or emergencies. This is particularly important where grid reliability may be an issue. To address remaining emissions, such as those from grid-supplied electricity or refrigerant leaks—off-site renewable energy procurement and verified carbon offsets may be necessary. These final measures help close the gap between on-site efforts and full alignment with net-zero or carbon-neutral goals. THE FINAL MILE

ELECTRIFICATION IN ACTION

GLOBAL REAL ESTATE INVESTMENT MANAGER

GLOBAL INSURANCE SERVICES LEADER

TARGET

TARGET

50% emission reduction (Scope 1, 2, and 3) by 2030.

GHG emission reduction goal of 50% by 2030.

Net-zero Carbon by 2040.

Net-zero by 2050.

APPROACH Cushman & Wakefield building performance team developed a building level net-zero roadmap with energy conservation and emission reduction measures. Implementation commenced in 2024. SOLUTIONS Low-cost/no-cost measures: Thermostat audit, heat pump performance testing, advanced pump control, off hour review and realtime metering. Capital investment projects: sequence of operations and commissioning, occupancy sensors for HVAC control, occupancy- and daylight-responsive lighting controls. Deeper strategies: on-site solar with battery backup. Final mile: Off-site renewables and carbon offsets close the gap, and additional improvements align with tenant renewal timelines.

APPROACH Cushman & Wakefield’s building performance team developed a building level net-zero roadmap with energy conservation and reduction measures. Implementation commenced in 2025. SOLUTIONS Low-cost/no-cost measures: Tenant engagement, lighting controls review, and replacing domestic hot water with heat pump. Capital investment projects: Expand use of LED lighting, upgrade pneumatics to direct digital controls (DDC),install carbon monoxide (CO) sensors in the garage, install additional window panels, and a fan wall. Deeper strategies: replace boilers with heat pumps, electrify kitchen equipment, install on-site solar. Final mile: Off-site solar supply and carbon offsets. EXPECTED IMPACT

EXPECTED IMPACT

Reduction in annual energy usage by 1.3m kWh

Reduction in annual energy usage by 920,000 kWh

Reduction in annual greenhouse gas emissions by 382 tCO 2 e Meet milestones including 50% emissions reduction by 2030

Reduction in annual greenhouse gas emissions by 501 tCO 2 e Meet milestones including 50% emissions reduction by 2030

PARTNERING FROM STRATEGY TO DELIVERY

Execution defines success. Electrification is not just a technical upgrade—it’s a complex delivery program that demands coordination across asset management, sustainability, tenant engagement, capital works, and compliance. For large or diverse portfolios, the complexity increases. Early alignment with the right delivery partner is critical. A capable delivery partner turns strategy into action. They manage the full electrification lifecycle—from feasibility and procurement to rollout and tenant integration—while mitigating risk and maintaining momentum. But the right partner goes further. They connect asset level actions to portfolio wide targets, balancing carbon, cost and compliance. They embed governance, align programs with capital planning cycles, and ensure upgrades support broader organizational transformation. Crucially, they build internal capability, equipping your teams to deliver electrification at scale, with confidence and repeatability.

STEPS

HOW CUSHMAN & WAKEFIELD CAN SUPPORT

BASELINE YOUR ENERGY USE Audit usage and implement load reduction strategies and actions GET YOUR BUDGET AND MODELS IN PLACE Put planning frameworks in place to support electrification

Perform an energy audit including baseline for energy usage and GHG emissions. Identify all reduction opportunities, including low- or no-cost operational changes with measurable savings potential.

1

Conduct feasibility studies, forecasting financial and emissions savings, including return on investment, payback period modeling, and capability analysis to define priorities, schedules, and capital expenditure needs.

2

MOVE FROM STRATEGY TO ACTION Prioritize assets and prepare for electrification

Conduct and report whole-building assessments, including energy and emissions analysis, and review of local laws and compliance requirements. Establish net-zero roadmap for carbon neutrality and outline energy conservation and emissions reduction measures.

3

BUILD FOR NET ZERO Implement capital efficiency upgrades and replace fossil fuel based systems

Manage project execution, including program delivery and commissioning. Optimize performance post-occupancy, including fine-tuning systems. Provide detailed design, procurement, and engineering consulting support. Track and monitor ongoing performance against targets.

4

WE THINK & WE DO WE CAN CREATE YOUR STRATEGY AND IMPLEMENT IT TOO.

NET-ZERO CARBON

STRATEGY SUSTAINABILITY ADVISORY

EXECUTION SUSTAINABLE OPERATIONS

CLIMATE RISK & RESILIENCE

SUBSCRIBE TO OUR HOW TO GUIDES

COMPLIANCE, REPORTING & DISCLOSURE

SUSTAINABILITY ADVISORY We develop strategies to tackle challenges, meet stakeholders’

NET-ZERO CARBON

CLIMATE RISK & RESILIENCE We assess the climate-related impact on your assets and then help you manage, mitigate and disclose your risks and opportunities.

REPORTING & DISCLOSURES We help you

SUSTAINABLE OPERATIONS We help you manage your buildings responsibly. We benchmark, plan, monitor and then report progress.

We assess your baseline, create roadmaps and

navigate the complex compliance landscape and demonstrate and communicate impact, through our reporting and disclosure solutions.

expectations, and deliver on your corporate responsibilities.

optimize your path to net zero. Then we help you deliver net-zero .

HOW TO POWER BUILDINGS FOR A NET ZERO FUTURE A practical guide to building electrification

AMERICAS

EMEA

APAC

JESSICA FRANCISCO Chief Sustainability Officer jessica.francisco@cushwake.com

JAMES WOODHEAD Head of Sustainability Services, EMEA james.woodhead@cushwake.com

MATT CLIFFORD Head of Sustainability Services, APAC matt.clifford@cushwake.com

MATT JOHNSON Net Zero Carbon Lead matt.johnson1@cushwake.com

THIBALD GERARDIN Net Zero Carbon Lead thibald.gerardin@cushwake.com

STEPHEN BRAMMER Net Zero Carbon Lead stephen.brammer@cushwake.com

ABOUT CUSHMAN & WAKEFIELD Cushman & Wakefield (NYSE: CWK) is a leading global commercial real estate services firm for property owners and occupiers with approximately 52,000 employees in nearly 400 offices and 60 countries. In 2024, the firm reported revenue of $9.4 billion across its core service lines of Services, Leasing, Capital markets, and Valuation and other. Built around the belief that Better never settles, the firm receives numerous industry and business accolades for its award-winning culture. For additional information, visit www.cushmanwakefield.com.

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