Market based renovation solutions in non-residential buildings – Why commercial buildings are not renovated to NZEB

| openaire: EC/H2020/856602/EU//FINEST TWINS Funding Information: We are grateful to AU Energiateenus OÛ team for collaboration and sharing the energy data. Our thanks are extended to the interviewees Raiko Uri from Lumi Capital; Kuldar Leis, the business consultant in periphery; Janek Hintsov from BPT Real Estate; Vahur Kaska from Kapitel; Indrek Peterson from EEEL; Margus N?lvak and Rein Suurv?li from Mainor ?lemiste; Alo N?mmik and Rain Aksiim from Kaamos Kinnisvara. Our thanks to Mare-Anne Laane for providing language help. This research was supported by the Estonian Centre of Excellence in Zero Energy and Resource Efficient Smart Buildings and Districts, ZEBE and the programme Mobilitas Pluss funded by the European Regional Development Fund, by the Estonian Research Council and by the European Commission through the H2020 project Finest Twins. All funding are for the conduct of the research and preparation of the article; for the collection, analysis and interpretation of data; to write the report; and for the decision to submit the article for publication. Funding Information: This research was supported by the Estonian Centre of Excellence in Zero Energy and Resource Efficient Smart Buildings and Districts, ZEBE and the programme Mobilitas Pluss funded by the European Regional Development Fund, by the Estonian Research Council and by the European Commission through the H2020 project Finest Twins. All funding are for the conduct of the research and preparation of the article; for the collection, analysis and interpretation of data; to write the report; and for the decision to submit the article for publication. Publisher Copyright: © 2021 Elsevier B.V.Renovation of commercial buildings was studied to analyze typical energy improvements and to determine the performance gap in relation to major NZEB level renovation. To provide input for Estonian long-term renovation strategy, building samples and interviews were used to study how the commercial property companies deal with the building renovation need in Estonia. Results show that in office buildings renovations improved energy performance marginally and a performance gap of about 40% existed after market-based renovation. About one third of trade buildings reached the NZEB level, but within the rest, the performance gap was about 50%. A common renovation cost was around 10 €/m2, but major renovation will need 130–150 €/m2. The main obstacle was the long, 20–30-year payback time and uncertainty of the measures for major renovation. This increases the risk of investment for a real estate company preferring max 10-year payback time. Interviewees pointed out, that tenants are not motivated to invest because the expected 2–3% saving in the sum of rental and energy cost seems invisible. To start the NZEB renovation, building owners recommended preparation of new energy or carbon taxes together with incentives and knowledge about energy efficient renovation.Peer reviewe