Tips to Select the Right HVAC System for Your Commercial Real Estate

David Cohn
Jul 19, 2023
commercial real estate

Investing in a new commercial HVAC system is a crucial decision that can impact the value of your property, which is why CRE investors are very particular about it. It's crucial to select an HVAC system that ensures uninterrupted comfort for your staff, customers, and clients.

After all, extreme temperatures can hamper employee performance and discourage customers from visiting your establishment. With the right HVAC system, you can also reduce monthly utility expenses, improve indoor air quality, and prevent any catastrophic system failures.

Let's take a closer look at the key factors that you should consider when choosing a new HVAC system for your CRE investment.

Types of commercial HVAC systems

The two most popular commercial HVAC types are packaged systems and heat pumps. Here’s a short description of each type:

  • Packaged Systems - Packaged commercial HVAC systems are designed to combine separate heating and cooling units into a single unit, making them highly efficient in terms of space and energy usage. These systems are usually installed outdoors on the roof or ground of the building and connected to the ductwork through a hole in an outside wall.

In addition to their space and energy efficiency, packaged HVAC systems offer several benefits, including low installation costs, enhanced indoor air quality, and easy access for maintenance by technicians. Additionally, these systems operate quietly and are energy-efficient due to their combination of heating and cooling functions within a single unit.

  • Heat Pumps - Heat pumps provide an effective means of heating and cooling a commercial building by drawing in heat from the outside during colder months and releasing hot air outside during summer. When installed correctly and in the right conditions, they can reduce monthly utility bills, lessen the need for maintenance, lower carbon emissions, and offer long-term durability.

It's important to note that heat pumps are best suited for moderate or milder climates as they tend to be less efficient in extremely cold weather. Also, heat pumps have a few disadvantages, including high installation costs and a larger physical footprint compared to other types of HVAC systems.

Proper sizing for commercial HVAC systems

When looking to install a new or upgrade an existing commercial HVAC system, it's essential to consider the size and suitability of the unit for your building. These factors have a direct impact on the system’s performance, cost, and maintenance.

You might think that bigger is always better, but that is not the case when it comes to commercial HVAC systems. Using an oversized system makes it difficult to control humidity, causing discomfort for occupants and increasing the risk of asthma and mold growth.

Additionally, it can end up wasting energy while also being expensive to install and maintain. Meanwhile, an undersized commercial HVAC unit has to operate continuously to produce the required amount of cooled air.

This continuous operation puts a strain on the compressor and increases wear and tear, which ultimately leads to longer wait times for the desired temperature and higher energy costs.

Properly sizing a commercial HVAC system requires a thorough understanding of important HVAC principles and calculations.

A professional industrial air conditioning company can help you in this regard. There is no substitute for professional advice on this matter. That said, there are some general principles to keep in mind.

1. To choose the right air conditioning unit for your building, you need to calculate its cooling load, which depends on factors like building design, orientation, and external temperature.

Think about these various factors:

  • The variance between the outdoor temperature and the temperature range you wish to maintain indoors
  • The architectural structure of the building and the degree of insulation provided by the walls and ceiling
  • The position of the building relative to the sun (whether it is in a shaded area or not)
  • The average size of the rooms and the total number of individuals occupying them
  • The type and quantity of lighting available (such as LED versus halogen)
  • Activities carried out in the building that may produce heat (such as cooking if your commercial building is leased out to restaurants, for example)

2. Commercial HVAC systems range from 2 to 30 tons. A 1-ton HVAC system can cool around 12,000 Btu per hour.

A general estimate is that it takes 25 Btu to cool one square foot. To determine the appropriate size of the HVAC system for your commercial building:

  • Calculate the size (square footage) of the space you want to cool.
  • Divide the area by 500.
  • Multiply the result by 12,000 to calculate the cooling load for that space.
  • To account for occupants in the building, add 380 Btu per person and 1,200 Btu for every kitchen.
  • Add 1,000 Btu to compensate for solar radiation through windows.
  • Divide the total by 12,000 to convert it back to tons, which will give you the size of the required HVAC system.

Heat loads and cooling loads

It's also important to calculate the heat load and cooling load of your commercial building to determine the most suitable HVAC system for it. The Air Conditioning Contractors of America have published useful procedures for this purpose.

Cooling load calculations estimate heat gain during the hottest part of the day, while heat load calculations estimate heat loss during the coldest periods, accounting for internal heat sources.

Heat gain is influenced by factors such as solar radiation through windows, conduction through roofs and walls, and heat generated by occupants, equipment, lighting, and appliances.

All these factors are taken into account by the transfer function method, which is a standard calculation procedure developed by the ASHRAE Task Group.

This method simplifies the cooling and heating load calculations and involves complex computations that require specialized computer applications.

Reliability, air quality, and efficiency

No matter what type of HVAC system you choose, be sure to prioritize reliability above all else. Poor heating and cooling can pose a risk to your inventory, potentially causing serious financial losses.

And if your HVAC system breaks down, it can render the property unusable until it is repaired, which means your employees, clients, and customers will not be able to conduct business.

Besides reliability, it’s also crucial to look at two other factors: air quality and efficiency. Poor indoor air quality can negatively affect the well-being of both employees and customers, causing discomfort or even sickness.

The US Department of Energy analyzed the financial effects of inadequate indoor air quality and found that the decreased productivity resulting from this issue cost anywhere from $12 billion to $125 billion annually.

More recent studies have indicated that enhancing a worker's indoor surroundings can enhance productivity by 3% to 20%.Efficiency is also a crucial consideration when selecting an HVAC system. After all,commercial buildings typically spend about 40% of their energy costs on heating and cooling.

An efficient system can help reduce monthly expenses by consuming less energy, which can result in lower energy bills—and more profit for your CRE investment over the long term.

A high-quality brand and reputable installer

When it comes to commercial HVAC brands, you get what you pay for. Invest in high-quality systems from reputable manufacturers to ensure a worthwhile return on investment.

Additionally, be sure to work with a good air conditioning maintenance and installation company to guarantee the system’s proper installation and functioning. A reputable company has insurance coverage in place to protect your company from liability in case of accidents while they’re working on-site.

Future-proof features

The fast pace of technological advancements can render some HVAC systems obsolete quickly. It is therefore wise to invest in future-proof systems that offer long-term benefits, including reduced electricity bills. Such systems are equipped with modern features such as wireless control, advanced temperature and humidity control, and energy efficiency.

While there might be wisdom in choosing older ‘proven’ models, it's important to note that these models may no longer be in production, making it difficult to find spare parts in case of a breakdown.

Also, some older models may not be compatible with your building's design, resulting in extra costs for modifications. It is typically easier to find the appropriate repair services and spare parts for newer versions of HVAC systems.


Ensuring a properly functioning commercial air conditioning system involves more than just buying and installing it. The factors mentioned above can assist CRE building owners in selecting the most suitable system with sufficient capacity to cool their entire property.

Investing in a high-quality commercial HVAC system can improve indoor air quality, control humidity, and prevent harmful gas accumulation to create a more comfortable and healthier environment for employees and customers.

It can also increase energy efficiency and reduce monthly utility bills while minimizing your building’s carbon footprint.

Moreover, it can help prolong the lifespan of building materials (such as roofing and insulation) when appropriately designed and maintained.

A high-quality HVAC system is a long-term investment that provides reliable and consistent performance for years to come, so make sure that you’re choosing the right one for your CRE investment.