In Funding Europe’s Green Transition – Reframing the challenge, Redevco argues that the shift from brown to green buildings is not a one-off balance sheet event, but an ongoing capital flow requirement that will influence investment strategy, lending markets, and asset management decisions well into the next decade. 

Drawing on data from MSCI, Savills, Cushman & Wakefield, Bayes Business School, Eurostat and the OECD, the paper assesses retrofit needs across the office and residential sectors, highlighting both risks and opportunities for capital providers.

The paper at a glance

€100 billion of office assets at a turning point 

Across the main European markets analysed, around 40–50% of office floorspace falls within EPC D/E categories. In capital value terms, this represents approximately €100 billion of invested office stock whose long-term viability depends on meaningful reinvestment by 2030. 

Upgrading these assets from EPC D/E to EPC B is estimated to require roughly €10 billion in total. Viewed in isolation, that figure appears significant. However, when aligned with regulatory compliance deadlines between 2026 and 2030, the annualised requirement falls to approximately €2.5 billion per year across Europe. 

The required annual spend represents around 2–3% of capital value, compared with less than 1% historically allocated to improvements. Sustainability upgrades are therefore becoming embedded within standard underwriting assumptions rather than treated as exceptional outlays. 

“Describing the transition as a looming cost burden oversimplifies the issue,” said Simon Marx, Head of Research at Redevco. “When assessed against regulatory timelines, it becomes a predictable capital allocation programme. The focus shifts from the scale of the number to how efficiently capital is deployed.” 

France and the UK account for nearly half of the estimated upgrade requirement, rising to around two-thirds when Germany is included.

You can now read the full press release at the link below