Blog

17 Aug

ADA Accessibility – What is it and WHY?

michaelstrachan / Blog / / 0 Comments

150723211606-05-ada-wheel-chair-entrance-ramp-super-169

In honor of the 26th anniversary of the ADA (Americans with Disabilities Act), I wanted to take a little time to discuss the importance of the ADA legislation and its effect on tenants and landlords in the California construction and real estate industry.

The Americans with Disabilities Act was enacted in 1990, updated in 2010 and 2013 and is soon to be updated again in 2016 by the state of California.  It covers the following items concerning public facilities and access:

  • Paths of Travel (from street to building and from ADA parking to building)
  • Disabled parking stalls
  • Sidewalks and walkways
  • Curb cut and pedestrian ramps, handrails, guardrails and stair sets
  • Building entrances, corridors, rooms, service counters, and restrooms
  • Drinking fountains, elevators, signage and so much more!

Generally, what this means is all new construction must comply with these standards and if you own or lease an existing space that is not in compliance with the most current ADA act, it must be brought up to code if you choose to remodel the space and pull a permit.  It is important to understand that regardless of any kind of mental or physical disability or limitations, all Americans deserve the same level of access to public facilities and should not be denied these rights.  Unfortunately, some circumstances of the ADA legislation can be another example of California Lobbyists and Lawmakers trying to make a difference in society and passing laws that are not quite fully understood or completely misinterpreted at local levels, and that don’t actually help the people they are serving.

In this two-part blog, I would like to go over the two most important ADA accessibility issues –EXTERIOR AND INTERIOR  – plaguing existing buildings.  What they mean, how they are interpreted, and some costs associated with them.

PATH OF TRAVEL All paths of travel must be in compliance in order for someone to enter the building from the exterior.  This includes an accessible path of travel from the public street or right away and an accessible path of travel from the ADA parking stalls.  The path of travel from the public street or right away to the main entrance of the building must be accessible in case the person with disabilities needs to utilize public transportation. This requires a sidewalk or curb ramp to have a slope of no more that 4.5% in the downhill direction with no handrail or an 8.33% slope in the downhill direction with a handrail.  It also requires no more than 2% in cross slope (across the width of the sidewalk or curb ramp).  Those requirements are also present from the ADA parking stalls to the main entrance of the building, but there must also be the additional application of truncated domes warning sight impaired people they are entering a vehicular route from a pedestrian walkway.  The proper ADA parking signage and striping is also required, mounted at the mandated ADA height and widths per the 2013 code.

Path of travel can be very expensive – from the addition of truncated domes (>$10,000) to a complete remodel of the path of travel from the parking stalls ($35,000 to $150,000) or to the path of travel to the street (can be upwards of $150,000)  It is important to understand your local governments requirements because each city has a different interpretation of the state law.  Also – there are different opportunities in different cities to take advantage of “variances” where if the cost of the tenant improvements you are constructing fall below a certain amount (usually under $120,000) – you are only required to perform ADA upgrades that equal 20% of the value of the permitted construction.  Generally, cities require that any upgrades begin from the exterior of the space unless there is an existing condition that makes it impossible to perform.

Most existing buildings constructed before 2010 do not apply and there was a revision to the 2010 Act published in 2013 that changes the size and the application of the truncated domes so anything before 2013 not upgraded, must be done in order to be in compliance.

Stay tuned for the next blog regarding INTERIOR ADA ACCESSIBILITY.

23 Mar

What does TITLE 24 mean to you?

michaelstrachan / Blog / / 0 Comments

By Cheryl Osborn, President and Founder, CASCO CONTRACTORS

 
title24_easy

 

Title 24 is probably the most used commercial Real Estate term of 2016.  It means a lot of things to a lot of different people, so what does it mean to you?

 

First of all – what is it?  Title 24 is a California energy code that was actually enacted in 1975.  Its purpose was to reduce California’s energy consumption with the growing population in the areas of HVAC, Electrical / Lighting, and building envelope (insulation).  Up until 2013, it wasn’t significantly impacting the real estate industry.  In 2013 (effective in July 2014) the state of California came out with an amendment to the Energy Code for commercial and residential structures to not only have a zero net energy gain on new residential structures by 2020 and new commercial structures by 2030, but to significantly reduce peak energy consumption in existing commercial buildings.  The new construction piece is relatively clear but the existing commercial building requirements to reduce peak energy consumption are extremely hazy, to say the least.  So what does it mean to you – as a Broker, a Tenant and Landlord?

 

BROKERS

Brokers are in a difficult situation because they depend very early in the process of client representation on the information they receive from architects, engineers and general contractors. Because there are not any “rule of thumbs” to Title 24, it is increasingly difficult to explain to the client exactly what is required.  When this happens, professionals tend to error on the “safe” side – which translates to more tenant improvement money required to make the deal. Brokers need to understand there is a premium to any construction right now for Title 24 (as much as $8-$10 per sf) and guiding their clients through their options can significantly maximize opportunities to lower the TI costs and make a deal that is right for the customer.  Doing good research on the existing conditions and the proposed renovations and negotiating well with the landlord is imperative to making sure the tenant doesn’t end up with less than desirable results.

 

TENANTS

Tenants are also in a precarious situation because of the unknown.  When shopping for space, tenants need to understand their potential cost exposure to seemingly “small” improvements to a tenant improvement.  A lot of a TI allowance can be eaten up in the required Title 24 upgrades, depending on whose responsibility the improvements fall upon, leaving nothing for the items that really translate to the end user and their employees as palpable benefits (i.e. finishes, furniture, millwork, upgraded stone, etc.).  It is important for the tenant to make sure the broker has negotiated a clear responsibility for the costs of these improvements.  They also need to be open to creative ideas that may slightly affect the floorplan but can significantly minimize the exposure – such as adding a door to cordon off open areas to minimize lighting retrofits or picking and choosing which areas of the space to remodel.  Tenants also need to be conscious of making sure the end results fit their work demands – such as placing the motion sensored power outlets correctly and having the right lighting controls for their needs.

 

LANDLORDS

Over time, clearly landlords are poised to capitalize on the direct energy savings costs on their investments required by Title 24, but in most cases, they are being asked to fund them now with payoffs at more than 8 years –  when the typical lease is 5 years.   Being straddled with capital expenditures when tenants are looking for more can be a hindrance to a landlord in a competitive market.  Landlords are now doing more allowance deals than build to suits because the allowance is safer from a cost exposure perspective.  At the very lease, landlords need to budget for these capital expenditures and develop a plan to retrofit that works for them.

 

title24-lOverall, Title 24 energy requirements are not going away, but there is talk that a 2016 code will come out on existing building retrofitting to offer some clarity to the California Real Estate industry.  In the meantime, plan well for your commercial construction projects and turn off those lights!

16 Feb

Top NINE Tips for Crushing Your Tenant Improvement – PART TWO

michaelstrachan / Blog / / 0 Comments

By Cheryl Osborn, President and Founder, CASCO CONTRACTORS

commerical-tenant-improvement

 

(Continued) Most companies value their work space and it is an intrinsic part of how they do business – functionally and culturally.  Leasing or buying a new workspace that requires tenant improvements seems like a natural part of the growing or downsizing process but it carries its own set of issues that need to be addressed.  There are several things to keep in mind when going through this process but I am here to highlight the NINE MOST IMPORTANT CONSIDERATIONS WHEN TAKING ON A TENANT IMPROVEMENT.

OH SH**!!!

Make sure your budget allows for the unforeseen.  As much as we want to protect ourselves from any costs or delays associated with changes, the unforeseen is what can kill a budget and a schedule.  Know the terms of your lease, but unforeseen conditions are likely your responsibility.  I like to keep at least a 5% contingency to spend on items that honestly could not have been known prior to opening up that wall or knocking down the ceiling.

STAY CURRENT

Know you are getting the best end product and the best finishes available. With so many options right now, the prices for things like flooring, wallcoverings and interesting finish options do not need to break the bank.  Also, make sure the color schemes you pick will still be current in 3-5 years.

SCHEDULE IS $$$

Make sure the contractor maintains their schedule.  Ask them to submit a weekly schedule chronicling their activities and how it ties into your construction completion date.  This is important during the process so you can plan all of your responsibilities as a tenant – i.e. tele data cabling, furniture delivery and installation, security work and most notably, your actual move in date.

WERE DONE!!!

Time for the punch walk – the moment of truth.  Be aware of ALL items you need to look for – functionality of doors, HVAC maps that tell you which thermostat is controlling the air, that the power is in the correct place for your equipment, walls are all completed and look good in all different shades of lighting throughout the day.  This is the time to pick up on any imperfections and hold the contractor accountable.

WE MOVED IN!!!

This phase encompasses the warranty period – the first 1-2 years (depending on the contractor’s warranty) where they will be available to fix any equipment that goes bad, any lighting or electrical work that malfunctions or plumbing and appliance issues.  Make sure you fully understand your contractors warranty and you know who to call if things go wrong so you are not paying expensive maintenance fees for things that are covered under your warranty.

Tenant improvement can be a long and arduous process so it is important to understand these important tips to make sure that things go as smoothly, quickly and as cost effectively as possible.

04 Feb

Top NINE Tips for Crushing Your Tenant Improvement – PART ONE

michaelstrachan / Blog / / 0 Comments

By Cheryl Osborn, President and Found, CASCO CONTRACTORS

bullitt-work-in-progress-BullittCenter

Most companies value their work space and it is an intrinsic part of how they do business – functionally and culturally.  Leasing or buying a new workspace that requires tenant improvements seems like a natural part of the growing or downsizing process but it carries its own set of issues that need to be addressed.  There are several things to keep in mind when going through this process but I am here to highlight the NINE MOST IMPORTANT CONSIDERATIONS WHEN TAKING ON A TENANT IMPROVEMENT

PROGRAM, PROGRAM, PROGRAM

Do your own programming beforehand.  Let’s face it, companies change all the time – some on the edge of a dime and some in a more strategic, structured way.  Regardless, you need to understand who your company is today, who it will be in a year and then in 3 years.  If there is uncertainty, take that into consideration and maybe sign a shorter duration lease.  If there is a strategic growth plan, make sure your space has the required expansion ability and if you find the right space, lock it in for a longer amount of time.  Make sure you understand how the people will fit into the space and allow for extra space for employee amenities, circulation space and growth.  This is what the millennials are looking for and these “fringes” are often overlooked when you are looking to maximize the square footage per person.

THE LEASE SAYS THAT?!?

iStock_000002313724Small-477x319First of all, make sure you allow enough time for the lease process and the construction (6 months before projected occupancy).  Then, understand what is in your lease.  This is where you become best friends with your broker.  A lease is very complicated and the terms that you agree to do not “bend” – especially if it is in the landlord’s best interest.   Make sure you are getting a fair deal that provides the rent that works for you and the tenant improvement allowance that is realistic.  Understand your terms as well – can you use this money for furniture and fixtures or only “hard construction”.

IT’S ALL ABOUT THE DETAILS
Walk through the proposed floorplan, scope of work and all the details PRIOR to signing your lease.  These details cannot be overstated to how important they are – for timing and for budget.  With tenant improvement, any change after the deal is done costs money and time.  Even just moving a wall or adding an office can create engineering and building permit nightmares so it is best to have the overall layout set in stone before you start the process.  Make sure your architect or your contractor spend at least 1 hour per 6,000 sf with you reviewing the details prior to starting.

THERE ARE OPTIONS?!?

Ready Now Suite 900 6Have a lot of options (i.e. alternates to your pricing).  Sometimes the idea of something is great but you have to really evaluate the cost and the benefit and the only way to do that is to see what those costs are and make educated decisions BEFORE you start construction.  This could be upgraded finishes, additional workspace benefits or just any whim you would love to see come to fruition (i.e. Google slide, company gym, nap pods…you get the picture).

STAY TUNED!  PART TWO COMING FEBRUARY 12, 2016!

10 Oct

Casco Blog – COMING SOON!

michaelstrachan / Blog / / 0 Comments

STAY TUNED!  Coming January, 2016!

Casco’s Blog will soon be up and running, bringing you news and information about the commercial real estate industry, commercial construction industry and tips and tricks for new property owners and tenants. Topics are hand selected and written by Cheryl Osborn, owner and founder of Casco Contractors, and draws from her years of experience in the industry.  Sign up to receive instant notifications when new articles are posted.