I have been doing some research on hot water recirculation systems, and without going into too much boring detail, I am renovating a basement and I’m considering using a water heater just for the kitchen and the bathroom in the basement. I’m almost sure I’m gonna go with a gas tankless unit...

I keep seeing references made to efficiency issues that tankless units have with most recirculation systems but I can’t seem to find out or figure out why. Can anyone elaborate on whether this is true and if so why?

If the water heater is just for a bathroom and kitchen, then I would guess that it could be located close to them and you don't need a recirculation system. But if you do, the tankless won't respond to such a low flow and won't work.

thanks again Jonr, thats a very good point. Should I focus on min flow rates for each model and if so, are the rated min flow rates required to ignite the unit usually accurate?

Should I focus on min flow rates for each model......

If the tankless water is in the general area of each service area, ie. kitchen and basement bath, don't bother trying to use a recirc system which pretty much defeats all the savings in this case!

If you think the bath will be used for showering while the kitchen is cleaning up on a steady basis, then use a 6 gpm unit like a Noritz, otherwise, probably any 3.5 g unit would work.

In most cases a recirc system is used to remedy distance issues.