How Solar Panels Can Boost Your Commercial Property’s Net Operating Income

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Maximizing NOI : How Solar Panels Can Boost Your Commercial Property’s Net Operating Income 

While the bottom line is king in any business, this sentiment rings no truer than in commercial real estate. Net Operating Income (NOI), the key metric for property owners, is the annual income generated by a property after taking into account all income collected from operations and deducting all directly associated operating expenses. Naturally, growing NOI is the primary goal for savvy property owners and they are increasingly turning to innovative solar rooftop leases to do so.

The Power of Solar Leasing 

Commercial Solar leasing is a simple concept: a solar developer leases unused rooftop space to house their solar facility. In return, the building owner receives a steady stream of lease payments from their new rooftop tenant! These payments contribute directly to Net Operating Income (NOI), increasing the property’s value without requiring any additional investment on the owner’s part. Solar leases can even generate revenue on brand new amenities, such as covered parking spaces in the form of a solar carport. The beauty of solar leasing is its simplicity. The solar developer handles the design, installation, maintenance, and operation of the solar panels. The property owner simply enjoys the benefits of the income generated by the lease.

Energy Savings through Power Purchase Agreements

An alternative to solar leasing is a Power Purchase Agreement (PPA). In a PPA, instead of leasing the rooftop space, the solar developer sells the electricity generated by the solar system back to the property at a sub retail rate. This arrangement leads to significant energy cost savings over time. This has been especially pertinent recently, given the increasingly volatile retail rates driven by geopolitics and climate change. Lower energy costs mean lower operating expenses, which in turn boost NOI. Moreover, a PPA allows one to promote their property in today’s environmentally conscious market as being powered by clean, renewable energy.

A Bright Future

Solar leasing and PPAs represent a win-win opportunity for commercial property owners. They offer a way to increase NOI and property value while incurring zero cost to the business. As the solar industry continues to grow and evolve, these benefits are set to become even more attractive.

As a commercial property owner, harnessing the power of the sun could be one of the smartest moves you make. Not only will you be taking a step towards a more sustainable future, but you’ll also see the benefits reflected in your bottom line. With increasingly exciting possibilities such as roof canopies and EV charging stations, solar presents too good of an opportunity to ignore.

If you’re interested in learning more, fill out this contact us form. One of our team members would be happy to answer questions that are more specific to your interests and property needs.


Ava Duane

Sales Operations Analyst

Ava joined NCS in 2023 after serving in the position of Channel Manager at Prism Group, a residential solar company out of Melbourne, Australia. She has a proven track record of increasing sales performance and efficiency, having more than tripled Prism’s average weekly sales during her tenure. At NCS, Ava oversees Sales Operations where she provides market research analysis, underwriting and administrative support to the Sales Team.

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