Insights
Buildings are significant contributors to global energy consumption and emissions, accounting for 30% of final energy consumption and 26% of energy-related emissions worldwide. With decarbonization mandates such as Local Law 97 and CRREM-Pathway driving the transition to greener practices, Commercial Real Estate companies face the critical challenge of retrofitting older buildings to meet stringent decarbonization requirements. Failing to do so risks stranding these assets, compromising their value and sustainability.
The older the building, the bigger the problem. It will come as no surprise, but older buildings typically consume more energy-a lot more. And older buildings tend to be 1) more heavily constructed using masonry or concrete and thus much harder to run wiring, 2) be less valuable and 3) higher probability of having asbestos. For these reasons, installing a wired BMS is not a viable solution to meet new Climate Mandates.
Climate Mandate Laws
NY Local Law 97
Buildings account for approximately two-thirds of greenhouse gas emissions in New York City and Local Law 97 is one of the most ambitious plans for reducing emissions in the nation. Under this groundbreaking law, most buildings over 25,000 square feet are required to meet new energy efficiency and greenhouse gas emissions limits as of 2024, with stricter limits coming into effect in 2030. The goal is to reduce the emissions produced by the city’s largest buildings 40 percent by 2030 and net zero by 2050.
Local Law 97
Fines for Non-Compliance stating in 2024
Buildings at +25k ft2
$268/Ton above limit anually
2024 Fines
3700+ Buildings
$213M Forecast
~$57,567/Bldg
2030 Fines
13,500+ Buildings
$900M Forecast
~$66,666/Bldg
EU CRREM Pathway
Under EU CRREM, if a building is not at or below the green line, what is called the CRREM-Pathway, by 2027, the building is officially deemed “Stranded,” which means that no EU bank can finance a sale, that the resale value of the building may drop by 85%, and that rents will also decline. EU estimates are that 42.5% of all buildings will become stranded by 2050.
SmartBMS Work Group
LEXI is committed to building the most cost- effective building management platform to combat decarbnonization and we know that we can’t do this on our own.
In October 2023, LEXI convened the first meeting of the SmartBMS Work Group, an industry trade group that we founded to fully develop the specifications of our SmartBMS.
The work group meets monthly and has grown from an initial membership of 5 companies to a current membership of 10 companies. Members of the SmartBMS Work Group include two of the world’s largest Real Estate Asset Managers, LEXI customers Crane and Rheem, and partners NXP Semiconductor and PriceWaterhouseCoopers (PwC).
LEXI SmartBMS Work Group
Work Group of industry leaders in the Property Management & Commercial Building spaces, led by LEXI, with a mission to develop a SmartBMS to help buildings meet the decarbonization goals.
Global Property Investment Co. $950B Assets
European Property Investment Co. $60B Assets
Semiconductor Company $10B Revenue
Industrial Valve Manufacturer $3B Revenue
HVAC Manufacturer $5B Revenue
Int’l Consultancy & Accounting $45B Revenue
Building Systems Integrator
Leading Indoor Wellness Company. Creator of the WELL Standard
