This paper addresses the problem of automatically determining the optimal retrofit of an existing heat exchanger network considering the placement/reassignment of existing exchangers to different process stream matches, their need for additional area, the placement of new heat exchanger and the cost of stream repiping. A two-level procedure, derived from a grassroot design model is proposed The master problem, related to structural optimization, is carried out by a simulated annealing (SA) procedure. For each generated network the required additional area for existing exchangers and the size of the new exchangers are optimized by a NonLinear Programming (NLP) algorithm. The purpose of this paper is to present the methodology and the resulting modifications to a previously developed Heat Exchanger Network Synthesis (HENS) model to treat this new aim. This approach is illustrated by two examples.