As Building Performance Standards (BPS) continue to expand across the country, much of the conversation has centered on the requirements of individual state and local programs. While those regulations differ, the lessons emerging from owners navigating them are remarkably consistent. From local ordinances in cities such as New York, Boston, Washington, D.C., and Denver to statewide requirements like Colorado's Building Performance Standard, compliance is becoming an increasingly important part of building ownership and long-term asset strategy.

Over the past several years, we've worked with owners, investors, lenders, property managers, and developers navigating these requirements nationwide. While much attention has focused on deadlines, reporting requirements, and penalties, the most valuable lessons have come from owners already working through them.

Start before you buy

One of the biggest lessons is that building performance standards should be evaluated during acquisition, not after closing.

Historically, property condition assessments (PCAs) and facility condition assessments (FCAs) have focused on deferred maintenance, building systems, and capital needs. Today, regulatory compliance and future energy performance obligations are commanding equal attention.

Owners increasingly want to know:

• Is the building currently compliant?
• How much capital investment may be required over the holding period?
• Are future energy reduction targets achievable? Which properties may not feasibly meet the requirements?
• What penalties, compliance costs, or reporting obligations could affect asset value?

Many investors now view BPS exposure similarly to deferred maintenance—another liability that must be identified, quantified, and incorporated into underwriting before acquisition.

Compliance planning creates value when integrated with capital planning

The most successful owners do not treat compliance as a standalone initiative. Instead, they incorporate building performance standards into broader capital planning efforts that already address deferred maintenance, facility condition, resilience, electrification, and major system replacements.

Owners have one capital budget, and compliance requirements compete with other priorities for the same dollars. The challenge is not simply achieving compliance—it is deploying capital strategically to support operational needs, ownership objectives, and long-term asset value.

By aligning compliance efforts with planned repairs and equipment replacement cycles, owners can often address multiple objectives through a single investment. Early planning also provides time to evaluate alternative compliance pathways, pursue extensions when available, and avoid costly last-minute decisions.

Verify the data before spending the money

A surprisingly common issue is that owners make decisions based on inaccurate or incomplete information. We’ve encountered incorrect building area calculations, utility data gaps, benchmarking errors, occupancy assumptions, and building classifications that significantly affected compliance determinations.

One owner approached us after acquiring a property that had been evaluated by another consultant and identified as non-compliant. Rather than immediately pursuing costly upgrades, they asked us to validate the compliance determination, identify potential exemptions or extensions, evaluate alternative compliance pathways, compare capital investments against potential penalties, and establish a realistic strategy aligned with their ownership horizon.

Before spending millions on improvements, owners should first confirm they fully understand the problem.

Independent advice matters

As regulations become more complex, many owners recognize the value of independent, impartial review that brings a broader, integrated perspective.

A contractor may focus on projects they’re positioned to build. A sustainability consultant may focus primarily on carbon reduction. A single-discipline team may evaluate compliance through only one lens. Owners increasingly seek advisors who can evaluate compliance alongside building condition, engineering considerations, capital planning, climate and insurance risks, operational requirements, and investment objectives.

In our experience, a multidisciplinary perspective helps owners validate assumptions, identify blind spots, protect against unnecessary expenditures, and coordinate more effectively with existing consultants or in-house teams.

The goal is not simply compliance. The goal is to make informed decisions that align with ownership strategy.

Today’s compliance does not solve tomorrow’s problem

Perhaps the most important lesson emerging from building performance standards nationwide is that compliance is not a one-time milestone, but an ongoing planning process.

As jurisdictions continue to strengthen performance requirements in pursuit of long-term energy and decarbonization goals, buildings that comply today may still require substantial improvements in future compliance cycles.

Owners often need two things:

• A technical review of what has already been reported to identify blind spots or errors,
• A long-term capital roadmap that aligns future compliance milestones with equipment replacement cycles, resilience investments, and ownership objectives.

This is particularly important as lenders, investors, and buyers increasingly evaluate regulatory exposure during due diligence and underwriting.

Looking ahead

The commercial real estate industry is beginning to recognize that building performance standards are not simply regulatory requirements. They are becoming another factor influencing asset value, capital planning, acquisition decisions, and portfolio risk.

The owners best positioned for success are those who start early, verify the data, integrate compliance into broader capital planning, and leverage multidisciplinary expertise to evaluate both costs and opportunities.