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Energy costs for UK businesses shot up by between 25% and 30% in 2021 and haven't stopped growing since.
That is the logic behind Manchester-based Bruntwood's decision that the solution to rising energy prices is buying a wind farm.
The move is claimed to be the first — but will not be the last — serious step into the energy generation and distribution business by a major UK landlord.
Bruntwood — which owns and develops office floorspace in its home city, Birmingham, Leeds, Cambridge, Glasgow and Liverpool — will now source 80% of its annual energy needs directly from a new co-owned wind farm at Kirk Hill in Ayrshire, Scotland.
Bruntwood has purchased a 42.4% share in the new co-operative-owned wind farm through its subsidiary Unify Energy, and it said it is the first commercial real estate company to make such a move.
Unify Energy will become a partner to the new wind farm, which is being developed by Ripple Energy. The new turbines will be whirring by 2023.
Apart from the green credentials, the payback for Bruntwood is price stability at a time of rapidly rising energy costs. It will protect its members from future energy price shocks by providing stable power for the future.
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There is also a serious potential gain for Bruntwood’s host cities. In Manchester, where the developer controls vast swathes of the secondhand and refurbished office market, the Bruntwood portfolio accounts for 0.6% of the city’s emissions if Bruntwood’s own energy use and its tenants’ are combined. Pivoting to a sustainable energy supplier could therefore have an immediate impact in meeting Manchester’s climate goals.
“In helping our cities take a big step forward in their own net-zero journeys, we’re also giving customers the opportunity to minimise their emissions and some protection from the inflationary pressures on energy prices through greater stability,” Bruntwood chief executive Chris Oglesby said.
Bruntwood is following in U.S. footsteps. In 2018 Boston Properties effectively acquired the Capricorn Ridge II Wind Farm in Sterling, Texas, for the projected power consumption at 33 buildings and garages totalling 15M SF in various Massachusetts locations. But Bruntwood is the first to join a wind farm's developer co-operative.
Unify Energy was launched in 2020 and is wholly owned by Bruntwood.
Ripple launched its first wind farm for ownership in summer 2020 at Graig Fatha Wind Farm in South Wales.
Construction of the second wind farm in Ayshire begins this summer. Power will begin to flow from 2023.
Bruntwood, which is controlled by the Oglesby family, has over £1.4B in assets and more than 100 properties across Manchester, Leeds, Liverpool and Birmingham. Bruntwood SciTech, a 50:50 joint venture with Legal & General, has assembled a 2.4M SF portfolio dedicated to the growth of the science and technology sector. It has a 5M SF development pipeline.
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