Ten Ways to Protect Vacant Buildings

A slowdown in the economy leads to business cutbacks and closings, which ultimately results in vacant buildings. According to real estate firm CB Richard Ellis, the 2007-09 recession increased the average vacancy rate for offices to 17 percent nationwide; nearly 10 percent of retail spaces were vacant. When buildings contain no occupants or personal property, they become susceptible to a variety of problems. There are approximately 31,000 fires in vacant buildings annually, resulting in dozens of deaths, hundreds of firefighter injuries, and an average $642 million in property damage.

Vacant buildings receive little or no maintenance, attention, or security. This can lead to problems such as:

* With no security on the premises, the building becomes a target for vandals. Vacant buildings frequently wind up with broken windows and graffiti-covered walls.

* Fixtures and materials inside the building, such as copper piping, may attract thieves.

* Vacant buildings can become convenient hang-outs for young people or shelters for homeless people; they also can become centers of criminal activity such as drug dealing.

* Trespassers smoking on the premises, decayed wiring, arson, and production of illegal drugs like methamphetamines may cause fires in vacant buildings. In addition, automatic sprinkler systems may be shut off, allowing fires to spread, and lack of security prevents early detection.

* Toxic substances remaining on the premises may leak and contaminate soil and groundwater.


Owners of vacant properties can take many steps to prevent these problems or make them less likely.

* Visit the property at least weekly or hire a property management company to do so.

* Clear the exterior of the building of scrap wood, paper, cardboard, and brush.

* Remove any toxic substances that could contaminate the area or harm police or firefighters.

* Maintain sidewalks and parking areas in good condition, and clear them of snow and ice.

* Erect obstacles to keep vehicles and pedestrians out of the parking areas.

* Hire security guards to watch the building at night and have exterior lighting turned on.

* Maintain the heat or drain the plumbing system to keep pipes from bursting, but maintain at least a minimum temperature in areas protected by automatic sprinkler systems.

* Maintain electricity to emergency lighting and exit signs.

* Shut off utilities except where necessary to power desired lighting and alarm systems.

* Maintain fire detection systems and link them to a central station monitoring service.

Buildings that are more than 69 percent vacant for more than 60 days lose some important insurance coverage. The standard commercial property insurance policy reduces loss payments by 15 percent for most causes of loss and does not cover others at all, including vandalism, water damage, glass breakage, and theft. For an additional premium, the building owner may be able to purchase vacancy permit coverage which reinstates some or all of this coverage for a specific period of time. An alternative, vacancy changes coverage, can reduce the minimum occupancy that the building must have before the insurance company will consider it vacant from the standard 31 percent. A professional insurance agent can identify companies that are willing to provide these coverages.

A vacant building is never a good situation, but with the proper precautions, the owner can maintain its value and keep it secure until new tenants move in.

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