Energy refurbishment can bring investors millions in added property value

Property investors do not need to find the money to pay for energy refurbishment. In the ESCO model, energy savings finance the retrofit project and the contractor guarantees savings.


Following comprehensive energy refurbishment at Frederiksberg Centret, the shopping centre now has a better indoor climate, common costs have fallen by more than DKK 1 million a year and the centre’s market value has significantly increased.

“We replaced the entire ventilation system here. It was hoisted through the roof,” says Allan Jack Jensen, Manager at Frederiksberg Centret, as he points up at the roofing. He has worked at the shopping centre since it opened in September 1996. He knows his way around “back stage”, here among the pallets and busy shop assistants.

This ventilation system is just one of ten that provide a comfortable indoor climate for employees and shoppers at Frederiksberg Centret. 23 degrees Celsius is the ideal temperature. Sensors inside and outside the building adjust the air temperature to cool or heat the centre depending on the season.

Danske Shoppingcentre – a partnership between ATP Ejendomme A/S (a property company) and two pension funds, Danica Pension and Lægernes Pensionskasse – owns Frederiksberg Centret. During a period of 18 months from July 2016, public areas of the centre underwent comprehensive energy refurbishment. Siemens was the general contractor.

Data from sensors and meters provides energy consumption overview 

Among other improvements, the shopping centre’s ventilation system was refurbished. The escalators are now radar-controlled so that they slow down when empty. Installations have been insulated and, not least, Allan Jack Jensen and his colleagues now have an excellent overview over energy use at the centre.

“It’s all digitally controlled. We can keep track of every system, the temperature in every retail unit, and water and power consumption. We can soon spot a defective valve and avoid leakages. Control systems are an important part of the energy refurbishment as they ensure that we achieve the savings we were promised,” says the centre manager.

Following substantial energy refurbishment, Allan Jack Jensen now has full control over energy use at the Frederiksberg Centret shopping centre – an investment that has significantly increased the centre’s property value. Photo: Laura Bisted Jacobsen

Energy savings pay for refurbishment

Danske Shoppingcentre has a portfolio of 17 shopping centres. Before energy refurbishment, the company figured that Frederiksberg Centret’s energy costs could be reduced. The shopping centre is managed by a property management company DEAS, which is also responsible for day-to-day operations and maintenance of the centre’s 65,500 m2.

“Our energy department calculated potential savings on the centre’s energy consumption per square metre. Working with Danish Technological Institute, we also took steps to develop an indoor climate strategy. Then we approached a number of ESCOs (Energy Service Companies) to obtain assessments and further calculations as to how much energy we could save and, not least, how much an energy retrofit would cost,” says Hans Andersen, Energy Manager at DEAS.

In an ESCO project, the client is guaranteed that energy savings resulting from refurbishment exceed the cost of refurbishment. The contractor’s initial surveys must therefore be very accurate.

“When we promise energy savings, we put our own money on the line. This makes the project almost risk-free for the investor”

“The preliminary work takes 3-6 months. It is important that this is done well as it forms the basis for the entire project. As general contractor, we calculate energy savings and subsequently implement the solutions. In the ten years Siemens has been involved in energy refurbishment in Denmark, I have not once found that we realised less than the promised savings,” says Thomas Brændgaard Nielsen, Sales Manager at Siemens Danmark



  • Energy use in the existing building mass accounts for almost 40 percent of the Denmark’s total energy consumption.
  • An ESCO (Energy Service Company) is an energy refurbishment concept, in which subsequent energy savings cover the cost of refurbishment.
  • Energy refurbishment at Frederiksberg Centret has delivered energy savings of 33 percent, corresponding to operating costs of DKK 1.2 million a year. Annual carbon emissions are reduced by 200 tonnes.
  • After the retrofit, the centre is worth an extra DKK 20 million.
  • Frederiksberg Centret received this year’s “Denmark’s best managed property” award.

The Centre is now worth an extra DKK 20 million

Since implementation, the refurbishment has brought about energy savings of 33 percent, corresponding to operating costs of DKK 1.2 million a year. Annual carbon emissions are reduced by 200 tonnes. The energy refurbishment project cost around DKK 10 million. Following refurbishment, the centre is worth an extra DKK 20 million.

“At Danske Shoppingcentre, we see improving the indoor climate and reducing operating costs as important assets. Together, they can potentially add huge value to a shopping centre. The fact that energy refits are also beneficial for the climate is simply a bonus. A better indoor climate, higher property value and smaller carbon footprint are all sweet music to the investor’s ear,” says Àrni Laksáfoss, Technical Manager at Danica Pension.

Hans Andersen, Energy Manager at DEAS, emphasises that the new ventilation system cooled the centre perfectly during this summer’s extraordinary heat wave.

“We would not have survived this past summer without the energy retrofit. There was a great demand for cooling but costs did not spiral. This goes to show that a better indoor climate and lower energy consumption can walk hand in hand. It’s a common mistake to see them as diametrical opposites,” he says.

Allan Jack Jensen, Manager at Frederiksberg Centret, and his colleagues now have an excellent overview over energy use at the centre. Photo: Laura Bisted Jacobsen

We must act on buildings’ energy consumption, scientist believes

Energy consumption in the existing building mass accounts for almost 40 percent of Denmark’s total energy consumption. If the energy used to heat, ventilate and light is optimised and therefore reduced, this may be one of the ways to achieve the political goal that is to dispense with fossil fuels by 2050,” believes Kim B. Wittchen, Senior Researcher, Danish Building Research Institute at Aalborg University. He researches into energy-effective buildings.

“If we are to try to save the planet from overheating, we need to do something about this 40 percent. Buildings tend to last for a very long time. While it is easy to build new, energy-effective buildings, doing something about the existing building mass is more difficult,” he says.

He believes that the ESCO model may help to accelerate energy refurbishment of buildings in Denmark.

“Retrofits that focus on energy savings compete, so to speak, with many other costs incurred by property owners. When money is a limited resource, you must prioritise. This is where the ESCOs come into their own,” says Kim B. Wittchen. He points out that owners should focus not only on the building’s envelope, i.e. its façade, windows and roof, but also on the indoor climate. Together, these factors ensure that buildings’ energy consumption can be reduced most efficiently.