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May/June 2016 • $5

Lighting Strategies: For Design and Energy Savings

Obamacare Reshapes Tips for Emergency Medical Buildings Preparedness

Green Unions Brave New World Add Their Muscle of Restrooms

Property Parking Innovations: Management Efficient & Green Challenges


Features Building Management Challenges Growing

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Q&A with Next BOMA Chair

When the Lights Go Out

Managing buildings has never been easy, but the job is becoming more complex and difficult for a number of reasons. A shortage of qualified managers is at a crisis level. And as buildings become incredibly “smarter” and more tech-driven, building managers and engineers must know much more than ever. Government officials are also always trying to think up new ways to add burdens. And more tenants’ employees crowd into spaces and use facilities originally planned for fewer people, multiplying a manager’s challenges. In this issue we are happy to present some solutions from respected industry leaders (See pages 14-15). Let us all give a shout-out to Orange County exec Brian Harnetiaux on his elevation to Chairman of BOMA International, the world’s largest commercial real estate organization. (See page 4) And don’t forget to lend your support to efforts like CREATE (see page 15), if you want to help alleviate human resource shortages.

Smoking Bans = Healthier, More Profitable Apartment Communities Apartment owners surely don’t need another government regulation to enforce— at their own expense—but many enlightened companies realize that the economic benefits of smoking bans in their buildings is enough to take action. Secondhand smoke is harmful to everyone’s health, people who work in apartment communities as well as those who live there. Smoking imposes a number of other landlord costs, from fires to filth cleanup to negative community image. Tenant prospects are increasingly aware of the dangers of smoking and prefer living in less-polluted buildings, especially people with children, who are at risk of developing asthma and other respiratory diseases from secondhand smoke. The American Lung Association says its effort in California “supports policies to protect the public from unwanted secondhand smoke exposure, including those that cover multi-unit housing. Smoke drifts through wall cracks and openings, putting those in neighboring units at risk for secondhand smoke exposure. In California, it is legal for a landlord to proactively designate its property as smoke-free, and many cities and counties have adopted strong smoke-free policies to protect their residents. The LA-based association in California tracks communities that have adopted these policies. “In California,” it says, “there are 48 cities and counties that have adopted policies that prohibit smoking in units, and 127 communities that have prohibited smoking in the common areas of multiunit housing to protect their residents from this health hazard. Not only are these policies legal, but they truly protect those who are living in situations where they are exposed to secondhand smoke and cannot move.”

Healthier Buildings Are Also Profitable for Multifamily Owners “Requiring units to be nonsmoking will save apartment owners money,” the association contends. “When a unit with a tenant who smoked becomes vacant, it costs landlords more money and time to clean and refurbish as damage is typically done to walls, carpets and draperies. A study showed that the average smoking related costs for apartment owners was $282 per unit. In addition, creating nonsmoking units will reduce the fire risk for landlords because cigarettes are the number one cause of residential fire deaths. Some insurance companies have even started offering discounts on fire insurance to owners of smoke-free apartment buildings.” – Henry Eason

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Lighting Strategies

Better Management Tips

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18

LA Green Trends

Association News

28

14

Marijuana & Landlords

Restrooms Innovations

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AIA SF Award Winners

Multifamily Outlook

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Cover images: Getty Images.

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California Buildings News Team Henry Eason, Editor and Publisher henry@easoncom.com Ellen Eason, Co-Publisher ellen@easoncom.com

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Contributing Editors Zachary Brown, CBRE Bob Eaton, Eaton Hotel Investments Jessica Handy, CodeGreen Solutions Rich Lerner, Construction Consultant Katherine A. Mattes, Real Estate Consultant Larry Morgan, Facilities, SAP Steven Ring, Fulcrum Real Estate Development Carlos Santamaria, CEES-Advisors

Advertising Information Ellen Eason, ellen@easoncom.com 415.596.9466 © Copyright 2016 Eason Communications LLC PO Box 225234 San Francisco, CA 94122-5234

www.cabuildingsnews.com Copyright © 2016 by Eason Communications LLC, publisher of California Buildings News. The publisher assumes no liability for opinions expressed in editorial contributions to the magazine or third-party quotations within articles. The publication is not responsible for claims in advertisements. Printed in the U.S.A.

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4 California Buildings News • May/June 2016

Q&A Orange County Exec to Head World’s Biggest CRE Association

During my tenure, I especially want to highlight BOMA’s education and research. People frequently ask me what BOMA’s “take” is on a specific topic or issue. Our advocacy team is always ahead of the curve on legislative issues from drones to e-cigarettes, and we have great thought leadership in a wide variety of other areas. For example, we recently released a white paper on workplace transformation and tenant occupancy density. Densification is an important concern in our industry right now as tenants lease less space per employee, and we want to support our members as they navigate this new reality. The white paper was released alongside a resource for property professionals called the “Tenant Leasing Checklist: A Guide for Assessing Tenant Occupancy Density,” which helps building owners and managers address the effects of this trend on the built environment. Property managers are seeing their roles become increasingly diversified—they now have to be experts on everything from accounting to information technology to customer relations. That means BOMA has to work hard to provide our members with all the information and training they need to do their jobs well. Luckily, you see that reflected in our educational and research offerings. We also have a number of excellent tools for those working within the fast-growing industrial sector, such as the Industrial Experience Exchange Report, a one-of-a-kind resource that provides benchmarking data for industrial properties. This is a very exciting time to be in commercial real estate, and BOMA International is going to continue to be fundamental to our success as an industry.

Q McCarthy Cook SVP Brian Harnetiaux to Become BOMA Chair for 2016-17

Q

Congratulations on being the next chairman of the Building Owners and Managers Association (BOMA) International. It’s good to have a Californian at the helm. As many of our readers are BOMA members or member prospects, can you give us an idea of your agenda?

A

BOMA International takes a holistic approach to supporting the industry, which means we work in many different areas. Whether it’s advocating commercial real estate’s interests before Congress or creating critical educational resources on cutting-edge topics, we’re constantly innovating to best support a strong industry. There may be those in the industry who aren’t aware of the full breadth of the work we do, and I want to showcase everything BOMA has to offer.

How can the commercial real estate management industry become more effective at recruiting and training managerial talent?

A

I am very passionate about this topic. Commercial property management is a wonderful career field: It’s rewarding, it’s interesting and it offers competitive salaries. The only problem is, not enough people know about it! When I was in college, I thought a property manager was just the person who stopped by to change the light bulbs, and most people in this job will tell you they found it by chance. However, our field is perfect for young professionals, many of whom can be very successful at an early age in this industry. Someone can start out as a receptionist and work their way up to asset manager or even real estate owner. Commercial real estate offers endless opportunities for advancement. Our industry places enormous importance on on-the-job training. We tend to promote from within, and that’s a great way to build up future leadership. Where that falls short, BOMA fills in the gaps with education, training,


5 California Buildings News • May/June 2016

mentorship opportunities and networking. At our annual conference, we host Career Day, which is an opportunity for college students and veterans transitioning out of military service to experience first-hand how rewarding commercial real estate can be. We also have an Emerging Professionals in CRE Program for those new to the industry. If we can make more people aware of the opportunities our industry offers, I think there will be no end to the amazing talent entering commercial real estate.

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What are the biggest legislative challenges ahead for the commercial real estate industry nationally? In California? And are there ways BOMA can better meet these challenges?

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BOMA has a very robust product and service membership. Commercial real estate is built on trust and relationships, and having trusted, reliable product or service vendor partners makes a property manager’s job much easier. When vendors get involved in BOMA, they are showing building owners and property managers that they are invested in the industry and in their local communities. Seeing someone regularly at BOMA local association events helps build relationships that make the industry stronger. Are there trends you see in California’s CRE management that you plan to highlight on the national stage?

A

Because we have so much usable outdoor space, California is on the forefront of the new “live-work-play” We saw some huge trend. We’re seeing this significantly change the way office legislative victories this past buildings are designed and winter, including the permamanaged, and property nent extension of the 15-year managers have to diversify “BOMA has a very robust product and depreciation on qualified their skill set to learn more leasehold improvements service membership. Commercial real about retail, for example. and a two-year extension There are many small estate is built on trust and relationships, of the energy efficiency tax changes that take place deduction for commercial when you manage a multiand having trusted, reliable product or buildings. We’re focusing use space —everything from on a number of other issues, service vendor partners makes a how common area mainteincluding supporting the nance charges are allocated property manager’s job much easier.” continuation of carried interto what your daily schedule est and “like-kind” exchanglooks like. I think this trend es, which are vital to the is going to spread across health of our industry. the country, even to places with much more variable In California, the biggest issue we’re facing is “split roll” weather. What this will look like in different cities is still property tax. In California, Proposition 13 limits the being determined, but BOMA is already offering resources to increase in property taxes annually, but certain legislators help property professionals excel with these new spaces. have been trying to rescind that and apply to residential What new or notable BOMA programs would you like only. This would mean commercial properties would be the industry to be more aware of? assessed either annually or every couple of years, which would have a very negative effect on our industry. BOMA We’ve seen tremendous growth with our BOMA 360 California and BOMA local associations across the state have Performance Program, which recognizes excellence in buildbeen working hard to educate our legislators about what this ing operations and management. Unlike other certification would mean for our industry. I truly believe our lawmakers programs, BOMA 360 looks at every aspect of the buildwant to do what’s best for the state economy, and they siming—from security and sustainability to tenant relations ply don’t know what the real-world effects of this would be. and training. BOMA 360 designees reap a tangible return on Our job is to give them the information they need to make investment through operational efficiencies, as well as highan informed decision. er rental rates and higher levels of tenant satisfaction and retention than similar buildings without the designation. BOMA can best meet these challenges the way it has The program also has a significant international presence— always—by educating our legislators about the needs of our there are BOMA 360 buildings in Canada, China, Colombia industry. That strategy has been working very well for us, as and Japan — with more countries starting to promote this evidenced by our recent legislative victories and our strong designation. This is an exciting program that offers a great advocacy presence both on Capitol Hill and in the states. return on investment, and I encourage everyone to consider Many BOMA members serve the industry as product participating. n and service vendors. How can BOMA be more meaningful to them? Attract more of them to BOMA?

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6 California Buildings News • May/June 2016

When the Lights Go Out...

Power Loss Triggers Many Types of Emergency… Some Useful Tips

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hen power fails in buildings, particularly large buildings, the business interruption can be brief and painless or long, costly and even dangerous. A California Buildings News survey of some of the state’s leading facilities and preparedness experts produced some very useful advice that can alleviate bad Photo: Getty Images. situations. “We work in tall buildings operated by complex systems. Sometimes lights and power go out. When that happens, here are some things you want to do or not do right away,” says Danny Murtagh, vice president of engineering at Boston Properties. He has responsibility for a number of skyscrapers in San Francisco, including iconic Embarcadero Center buildings. “The reasons can be many and vary from a local electrical incident that caused something to trip the building’s main breakers, all the way up to an earthquake. Whatever the cause, you will likely not have any immediate idea (with the exception of a catastrophic event like an earthquake), why all of a sudden it’s dark.” (See right box for some of Murtagh’s tips.) Other tips from industry leaders Josh Toothman and Adam Kilburn at Jones Lang LaSalle in California: w Plan, prepare, train for the potential event. Do a drill at least once a year where you and your property team do a loss of power scenario. w Have an emergency telephone list and have your essential vendor’s mobile numbers in your phone book, e.g. emergency generator vendor, fuel vendor. Certain events don’t occur when it’s conve nient—but when you’re away from your desk. (Continued next page)

Power Loss Tips

w Stop and think. Don’t panic and don’t call 911 unless you have a real emergency. Pause for several moments and talk to the people around you. w Listen for a building announce ment on the PA system. Often times the building management and staff will put a PA announcement out in a very short time frame. w 800#. Your building may have a mass notification system or at least an 800# number to call in for status updates on the building status. w Don’t go to the elevators. Even though the emergency power system may be able to run limited elevator service, don’t plan on using the elevators. Use the stairs to move around or exit the building. w Shelter in place first. Stay in place and try to assess what is going on around you and your building. Look out the window and see if other buildings around you have power. It may be a local issue within the building that staff are responding to and the duration may be short lived. It could also be a utility issue that may be short lived as well. w Most high-rise buildings have back up power systems, so things like fire alarm systems, emergency ventilation, limited elevators, exit signs and stairwell lights will remain on for a while. w If you must leave the building, do so in an orderly manner, don’t panic, stay with others and stay aware of conditions as you descend the stairs. And have a plan of what you’re going to be able to do once you leave. Don’t just leave to leave as it could be worse to be stuck outside in the dark and cold with nowhere to go and no way to get there. w If you know it is a regional issue that caused the outage and it has affected transportation, the building itself can often be a good safe haven to wait it out for a while and see what the issues and solutions are.

— Danny Murtagh, Boston Properties


7 California Buildings News • May/June 2016

w Although you may have an emergency generator, they

typically do not power the entire building. Understand what is on emergency power and what is on standby or backup power. w In a multi-tenant building have a clear understanding of what will cause workers to go home and what electrical load this represents. w In a multi-tenant building be sure to know how long tenant space can go without power before damages occur to their product. w Plan a worst-case-scenario based on your building type. A data center or hospital needs to know how long their generators can run at given load, i.e. amount of fuel on hand. Also an understand how long it takes to order diesel fuel. w Radios and building telecom systems may have failed as well. Have back up communi cation devices ready. w Be prepared once you regain power — what do you do next? w Have a specific list of inspection rounds to be performed during and after an outage to check on key equipment. w Be sure to communicate with the utility to determine cause of the outage and the likely hood of a repeat in the future.

But What If You’re Handicapped?

“During a power outage, the anatomy of a building changes. Elevators cannot be used, and the stairs become the only option for evacuation. What happens to those who are disabled, either permanent or temporary? Stairway evacuation chairs have solved this issue, helping persons all over the world escape successfully form buildings during emergency situations. They were used successfully in 9/11 in getting persons safely out of the World Trade Center. Tracked evacuation stair chairs contain reinforced belted treads which provide automatic braking allowing for a steady controlled descent down stairs,” says Adam Ross, business development, at Evac+Chair North America.

Other Power Issues

Securitas’ Los Angeles Area Vice President Jeff Winter, says, “High-rise buildings are equipped with an emergency generator that will restore power within seconds of a failure and will activate all lights in the stairwells, emergency lighting and exit signs in the corridors on each floor, power the communication and

fire safety systems and recall all elevators to the lobby. The building staff will generally have the ability to operate one elevator to transport emergency responders or service crews and to assist persons in need, if required. However, unless directed to do so, it is not necessary to evacuate the building during a power failure. “You may also want to consider unplugging all electronic equipment, as a power surge may occur when (Continued on page 36)


Reducing Total Door Power Consumption

However, as more people move toward low-power locking devices, they overlook what has become now the door’s main source of power consumption… the power supply that is sitting back in the IDF closet. Even when you have no power consumption from a fail-secure lock, the power supply is drawing 5+ Watts of power from the wall 24 hours a day, 7 days a week; providing exactly zero benefit to the end user. Enter EcoPower™. Using technology similar to a plug-in electric car, EcoPower utilizes the included battery to provide power to the locking device while maintaining 24+ hours of battery backup in the event of a power failure. While the battery “drives the lock” the power supply enters a sleep mode drawing a mere 0.008W from the wall, a GreenCircle Certified 99% reduction even when compared to highly efficient switching power supplies. When the

What happens when the battery reaches its end of life? EcoPower is designed with a microprocessor on board that detects when the battery is at the end of its life and notifies the end user that it is time for a battery replacement. If the battery is removed, EcoPower is still a fully functional power supply capable of powering both the low powered lock and card reader, even in the absence of the battery. The only thing that is lost is the ability to go to sleep in a Fail-Secure application where the lock is powered continuously. However, EcoPower still provides over a 70% reduction in power consumption even in this scenario. In a Fail-Safe scenario, while the lock is unpowered, EcoPower will continue to enter sleep mode and reduce power consumption significantly. Whether you are working on a net-zero energy building, or simply a building where the end user cares about dollars and cents; EcoPower when paired with a low power locking device such as the EcoFlex mortise lock from ASSA ABLOY can reduce total door power consumption

by 99% when compared to the traditional solenoid based alternatives. The best part? This savings can be achieved with zero extra out of pocket cost to the end user. Every kWh saved is money in the end users pocket.

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Traditional Power Supply

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“The power supply has become the door’s main source of energy consumption.”

battery reaches about 50% of its usable capacity, EcoPower wakes up, recharges the battery, and then goes back to sleep. During this recharge phase, EcoPower draws only 2W from the wall - significantly less than a traditional power supply draws, even without powering a locking device.

Total Door Power Consumption

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here is a trend in the locking hardware industry towards lower power locking devices. From ortise locks to electric strikes and exit devices, companies have been migrating from high powered solenoid actuators to lower powered options. For example the EcoFlex™ electrified mortise lock from ASSA ABLOY Group brands Corbin Russwin and SARGENT takes what used to be a 500mA current draw and reduces it to a mere 15mA. This 96% reduction in the lock’s power consumption is a huge improvement over existing locking devices.

Every kWh saved is money in the end users pocket. Consider the Impact of Specifying this Energy Saving System for 1,000 Stairwell Doors Across Multiple Facilities Copyright © 2016, Hanchett Entry Systems, Inc., an ASSA ABLOY Group company. All rights reserved. Reproduction in whole or in part without the express written permission of Hanchett Entry Systems, Inc. is prohibited.

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10 California Buildings News • May/June 2016

Revolutionary Lighting Strategies.... Cheaper, Greener and Design-Friendly

Shown above: IA Interior Architects’ project in Silicon Valley. Photo credit: Sherman Takata.

The value of LED lighting can be summarized in two words: efficiency and aesthetics. It costs less money and uses less energy, so it’s more efficient. And its limitless range of illumination in color and tone is a tool that designers can use to achieve wonderful and healthy effects. How economical and efficient are new lighting strategies? Not just LED technology but lighting controls and other products that make for better lighting? There are many features to LED that produce economic benefits. (See companion articles in this issue). “With demand for energy growing at 3% every year, we must use that energy more efficiently. Today, lighting accounts for about 15% of the world’s electricity consumption and approximately 50% of a city’s electricity bill when we consider lighting for roads, streets, parks and municipal buildings. If all cities (municipal facilities) switched to LED tomorrow, we could reduce energy consumption to 8%. This would be an important, necessary step towards our goal of achieving global carbon neutrality in the second half of this century,” says Harry Verhaar, head of global and public affairs at Philips Lighting. “The use of LED on projects has grown steadily over the past four to five years; and it has accelerated in the last 12-18 months,” says Eric Nyenhuis, senior project developer at Envise. “We see three facets creating this traction. First, it offers a broad application across industries. The same companies that are delivering LEDs to the building market are delivering to the auto industry, for example. As a result, multiple markets are driving research and development in the use, flexibility and longevity of LED. “Second, LED provides a significant level of energy efficiency gain over other modern lighting technologies. For example, a 20% to 30% reduction in fixture wattage can be (Continued on page 34)


11 California Buildings News • May/June 2016

Left: San Francisco City Hall – detail of lion’s head. Below: SF City Hall facade. Photos courtesy of Arup.

Lighting Strategies for Greater Aesthetics Designers Can “Paint” With Light…Then Change Colors Instantly The value of LED lighting costs less money and uses less energy, but it also offers limitless range of illumination in color and tone that is a tool that designers can use to achieve wonderful and healthy effects. One of the most dramatic illustrations of this is the lighting of the century-old San Francisco City Hall, one of the country’s proudest examples of civic architecture made even more dramatic by thematic lighting displays to illuminate all sorts of occasions, from sports victories to displays of solidarity with the French people after the recent terrorist bombing in Paris. Global engineering firm Arup was a major player in its lighting, such as at a recent conference of U.S. Mayors in San Francisco. “We were involved with retrofitting the existing façade lighting with LED sources as well as designing an opening light show to highlight some of the capabilities of the new lighting and control system,” says Emily Dufner, associate principal for lighting at Arup. “For the event, designers Digital Obscura created a spectacular projection-based light show that was the highlight of the evening. The former metal halide lighting limited both the ease of changing the color of the façade for events

(a member of the maintenance staff had to put color filters over every fixture in the past), as well as any dynamic lighting shows. Our retrofit also allowed us to fine tune the lighting of the façade and the dome to better reveal the details, texture, and depth of the architecture. According to Arup, “The metal halide fixtures used approximately 31,000 Watts of energy and required 6,000 hours of labor multiple times per year when the colored theatrical gels covering their lenses were manually switched out for themed celebrations. City Hall wished to upgrade from metal halide to dynamic color changing LEDs, saving an estimated 50-80% in energy and nearly eliminating labor costs for changing color themes. “The Arup team began work with a market research study, identifying and evaluating lighting manufacturers that could provide the scale and support needed by such an entity as City Hall. Factors such as the use of existing wiring, pricing, voltage compatibility, and previous client relationships played a factor. Philips Color Kinetics emerged as the product of choice. Mockups with their family of exterior fixtures were done. It was quickly determined that a custom product was needed to meet the color needs of the project. RGB capable LED fixtures were (Continued on page 35)


12 California Buildings News • May/June 2016

LED Tech Dramatically Changes Lighting Options, Value Q&A with Charles Knuffke, evangelist and Wattstopper vice president of systems, Legrand, North America What are some of the financial benefits of new lighting technologies? There were a few of us in California that were worried when the 2013 Title 24 Energy Code came out, because it included a requirement that general lighting had to be dimmable in any space that was more than 100 square feet AND was greater than 0.5 watts per square feet general lighting power density. We were cautious because we’ve seen so many issues when dimming was used on fluorescent fixtures—issues with wrong ballasts, or the wrong lampholders. With LEDs, there’s almost no drawback to adding dimming to the general lighting scheme— no having to worry about the wrong ballast, fixture or wiring like we had with fluorescent lighting. LEDs have been simple and easy to work on. What are some examples of new lighting technologies, in-house or otherwise, that are providing financial value? This goes beyond just energy savings, and gets us into the area of productivity for the occupants, but I would say the

ability to use tunable white luminaries — those with LED arrays that produce different CCT Kelvin Temperature outputs. By adjusting the output of the different LED sources, that Kelvin Temperature can be adjusted to any level between the two ranges. Human Centric Lighting is an area where we’re still waiting for the research to come about, but companies are now looking at what might be able to done to increase the benefits in applications such as education, retail and hospitality based on the ability to change the color temperature of the fixture or to add to that— adding saturation, colors, etc. The direct financial value of the install is that they (LEDs and new lighting technologies) are more efficient products overall, and I think that there will be telling research in regarding the productivity benefits that come from human centric lighting in the future. What are some good examples of design with LED? At this point, most interior and exterior lighting projects could be designed with LED fixtures. General lighting with California Title 24 has become overwhelmingly LED, and thatEIG-045 can also include down lights.2/17/16 I think specialty CaliforniaBuild (Industrial) 2:03only PM Page 1 applications might be difficult where some® one might still want to stay away from LEDs if there are unusual environmental restrictions (temperature issues for instance). What is the design potential for LED technology?

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That’s where it gets interesting. LED can fit any form factor, and are extremely malleable compared to what we’ve been using in the past. There isn’t much that couldn’t be done using LEDs. Right now we’ve been using them as a replacement for existing form factors (e.g. tubular LEDs to replace the standard fluorescent lamps, or


13 California Buildings News • May/June 2016

LEDs to fit into a 2x2 ceiling grid). You’ve got manufacturers that are really starting to design LEDs into novel new fixtures - some mind blowing new form factors — so I don’t see anything holding back LEDs in California in terms of design. How has LED changed the lighting and design industry? The first point is that LEDs have lowered the power usage requirements for lighting significantly so codes with prescriptive power allowance... are allowing much brighter and/or lower power spaces to be designed. Before you might have been worrying about how you were going to be able to provide enough light in a space based on what the watts per square foot were that were allowed, but that’s become less of a worry now. The key thing for our company is the capability of the LEDs to be switched on and off repeatedly without lowering their operating life. This was an issue previously with fluorescent fixtures where if you cycled them on and off quickly and repeatedly, it could reduce the life of the lamp. Now you can have LEDs inside freezer cases combined with occupancy sensors at the grocery store that go off 30 seconds after someone has walked down the aisle and there’s no worry at all about it. The other factor that is very favorable about LEDs is that they can be dimmed very easily. Most general lighting manufacturers provide dimming as a product offering with almost no or minimal additional cost, which is very beneficial to everyone There is only one negative side effect of LEDs that I’ve seen so far, which is that, depending on the driver design, LEDs can cause a very high inrush on the circuit compared to their normal current draw. I’ve seen a normally loaded circuit on a 20A breaker that had to be split onto two breakers because the exterior LEDs drew so much current when started up that the breaker continuously tripped. What is the future of LED? We’re continuing to see LEDs provide better controllability, color rendering capability, lower power usage, higher lumen outputs—so except for possible current inrush issues LEDs are really hitting on all cylinders. I do think that we’ll probably be looking at color tunable or tunable white solutions as an entire new opportunity for controls and for trying to enhance occupancy comfort and productivity. And for someone like myself that just hates looking up at the ceiling to see cool light lamps and warm light lamps right next to each other because the building owner didn’t know what Kelvin temperature florescent to use with when they went bad — to know that we’re going to have all this opportunity to control lighting color temperature of fixtures is inspiring and exciting. n

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14 California Buildings News • May/June 2016

Managing Buildings Better: Two Views Biggest Challenge: Finding More Well-Trained People California Buildings News asked two of the state’s leading property management experts from southern and northern California to describe their biggest challenges and ways they meet them. Both men are leaders in local Building Owners and Managers Associations. Both of them say there is a desperate need to provide adequate human resources to operate today’s increasingly complex buildings.

John Combs, Principal RiverRock Real Estate Group, Newport Beach Challenge: Recruitment from the shortage of job-ready college graduates Solution: Starting in 2015, Chris Lee reports that there is a shortage of 15,000-to-25,000 qualified workers in real estate and this trend will continue through 2025. In property management our product is our people, so this is a critical issue. We use LinkedIn and our company website to list available jobs, the BOMA job board, employee referrals with paid incentives and Career Builder. For college recruitments, we participate in career and job fairs. We send our younger leaders to recruit and relate with the students. We have found asking our employees (our “Rock Stars”) to consider neighbors’ kids that they have known and watched grow up and think have been raised with strong work ethics to refer them to our firm. Some of our best young and emerging leaders have come from our neighborhoods and we have known for years. College professors and deans of the business school are always eager to refer their “better students” to us for interviews.

Challenge: Training

Solution: We have put Rock University on steroids this year to enhance learning of multiple product types, various levels of experience and also put an intense new hire orientation class together that stresses our brand, culture and technical skills. Following each class, we send surveys on the experience as to modify the offerings. We also test at the end of each class to determine additional classes needed. We added to our curriculum an ethics class (taught to every Rock Star) as well as a time management class. Our customer service class is being re-written by an outside firm that specializes in Hospitality 5-Star Customer/Concierge level service.

Challenge: Increased responsibilities pushed down from the client

Solution: Everyone has less time to do more. That includes our clients who continue to push their tasks down to the property teams. While there is less compression on fees today, there is a resistance for clients to approve proper staffing levels in some instances. It is crucial that we continue to look for ways to streamline or automate work so that the managers can be in front of tenants and on the property. Clients want more asset management skills of the property managers and we now are providing more asset management skills and work product to clients. While this is fun for the experienced manager, it requires specific training in these skills. Because of the work crunch on our teams, we are adding soft-skill training such as time management, dealing with conflict, financial analysis, etc. It is a great time to be in property management as the next generation of managers are in short supply, the work skills have evolved into more asset management and a higher customer satisfaction interaction and with all the new legislation governing building operations.


15 California Buildings News • March/April 2016

Manny Moreno, Property Manager NPC Holdings LLC, Pleasanton

Challenge: Controlling expenses Solution: As everyone in property management is well aware, our goals each and every year are to increase revenue, while at the same time controlling, if not reducing, expenses. The most challenging aspect from my perspective is controlling and reducing expenses. In order to be competitive in this up market, you have to reduce expenses while maintaining or increasing amenities. At the forefront of most tenants’ minds is to ask about operating expenses, only second to rent rate. Modest increases year after year are acceptable if the tenant is realizing additional services and amenities. This is where property managers have to get creative. It is not only talking and working with your larger service providers on their costs and expenses, but also bringing new amenities and services to a property that don’t necessarily cost the owner anything. There are a growing number of entrepreneurs who just want parking lot space to park their food truck or service vehicles in order to offer a service, and tenants love it. Some of the on-site services we have at Stoneridge Corporate Plaza in Pleasanton are bike repair, haircuts, car washing, boot camp, dry-cleaning and blood drives. These additional amenities have no impact on our operating expenses, yet are a huge benefit for our tenants.

Challenge: Attracting new talent into the industry

Solution: As industry leaders, senior managers and aging baby boomer property managers progress in age and prepare to retire, the industry is being left with a shortage of qualified individuals to fill those upper management roles, and more importantly, backfill their roles as they get promoted and move up. This is an issue that BOMA has been discussing for several years, but it is still a challenge for our industry. We need to better market our industry to college students and recent graduates. Our industry covers so many different disciplines and offers almost unlimited growth potential. It is a tight-knit industry that also offers a comfortable living. Once people experience the industry, most stay. It is getting them to experience it that is the problem. However, we are starting to

see some success with the BOMA San Francisco Foundation’s efforts and that program morphing into CREATE (the Commercial Real Estate Alliance for Tomorrow’s Employees). This program has had successes with San Francisco State University students, some of whom are working in the industry today. We need to continue to grow this effort and encourage more young people to consider the industry as a career option.

Challenge: Time management

Solution: This is a challenge that I am sure transcends all industries, especially in this digital world of ours. Property “managers and commercial real estate professionals are pulled in so many different directions each and every day. From ownership requests and reporting, to tenant requests and meetings, to service provider interactions. Add to that industry trade associations, and their events, seminars, classes and meetings. Top it all off with a personal life. For me, that is being married with two children; their sporting events and extracurricular activities; and some personal golf time. It is an insane pace of life. The important thing is keeping what’s important first and knowing when to say no. Prioritize, organize and take advantage of those opportunities that may never present themselves again. Continue to reevaluate your priorities. Life changes, people change, jobs change, schedules change. How we manage our time is based on a combination of all these factors and what’s important to us. We can’t add more time into a day, so we have to better utilize the time we are given. Illustration: Getty Images.


16 California Buildings News • May/June 2016

Marijuana is Becoming Legal— Can a Landlord Still Say No? Yes...No...Maybe...Here’s the Issue By Kathy Mattes Only medical marijuana is legal in California, but the legalization of recreational marijuana will be on the November ballot and is likely to pass. How will this affect landlords? It is important to start with the fact that marijuana is still illegal at the federal level. When the Controlled Substance Act was enacted during the Nixon administration (1970), a schedule of five classifications of drugs was established. Marijuana was included in Schedule I, meaning that it was considered to have a high potential for abuse, no currently acceptable medical use and lacked safety for use under medical supervision. It prohibits possession, manufacture, distribution and dispensing. The Compassionate Use Act, enacted in 1996, decriminalized marijuana use for patients who have a physician’s recommendation. The physician’s recommendation is less than a prescription, so this is a low bar to purchase or grow it. The Medical Marijuana Program (MMP), enacted in 2004, clarified the scope of the CUA, created a voluntary program for ID cards and limited cultivation and distribution. A California Supreme Court Decision in People v. Kelly (2010) established that patients and primary caregivers are not subject to specific limits, and can have or use amounts “reasonably necessary for their or their charges’ personal medical needs.” At the federal level in 2013, the U.S. Deputy Attorney General issued a memo: “Guidance Regarding Marijuana Enforcement,” which identified eight priorities concerning marijuana, outside of which they will rely on state and local governments. However, they retained the ability to prosecute violators of federal law. These priorities include distribution to minors, selling across state lines, use as a cover for trafficking other drugs, and possession or use on federal property. Illustration: Getty Images.

In furtherance of this, Section 38 of the Appropriations Act (2015) prohibited the Department of Justice from using federal funds to undermine state medical marijuana laws and programs. It directed the Department of Justice to not criminally prosecute an organization that complies with state regulations.

What Can a Landlord Do? So what are the choices for a landlord when faced with the request of a tenant to cultivate or use marijuana? The answers and potential risks will differ depending on the property type (commercial, subsidized residential, or commercial residential). Here are some factors to consider: If the loan on the property is with a federally regulated bank or institution, then having marijuana use on the property could be a violation of the loan covenants. Will your all-risk or liability insurance policy cover you in the event of a fire or other damage as a result of marijuana use? With regard to commercial properties, since marijuana is still illegal at the federal level, marijuana dispensaries are not able to take credit card payments or have checking accounts. Therefore, it is a cash-only business and that raises security concerns. A commercial landlord should be able to safely say “No,” on the basis that marijuana is still illegal at the federal level, or choose to take the risks and define how they will be allocated between the parties. For public housing and project-based HUD subsidized housing, the answer seems to be simply “No.” HUD memos in 2011 and 2014 both imply zero tolerance for drugs, including marijuana. They establish application and screening standards that prohibit renting to a family with a member illegally using a controlled substance. They also (Continued on page 36)


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18 California Buildings News • May/June 2016

Public Restrooms... A Brave New World

Transgender & Other Issues Foreshadow New Designs When the North Carolina legislature ignited the transgender public restroom issue, it brought new focus on how such conveniences are designed and equipped. The good news is that much of the angry fuss over the matter can be alleviated with more creative approaches to restroom interior design. Meanwhile, restroom design and products have continued to evolve to create a much more pleasing experience.

We’re already seeing public restrooms in some places — like in a few restaurants and conference centers in San Francisco— moving toward a coed washroom area and individual closed or an array of single restrooms along a corridor that would seem to dampen the gender controversy. Going toward this model is more likely for new-built facilities. They would, of course, require massive renovation efforts in all types of commercial buildings that serve the public. It would surely trigger public-private legislative battles that would make the ADA bathroom access issue seem like a tempest in a teapot if attempts were made to mandate extensive renovations in existing facilities. Above: Unisex restrooms at The Bently Reserve in San Francisco combine contemporary design with functionality. Photo courtesy of The Bently Reserve.


A new building code helps resolve bathroom issues. (See sidebar at bottom right.) The code was introduced by Aiken, S.C. mechanical engineer Bruce Pitts, who worked with the National Organization of Women (NOW), members of the American Institute of Architects and the American Restroom Association during its development. “Multiple-occupancy restrooms and bathing rooms have been around for centuries yet are no longer needed — history in the making,” says Pitts. He says the single-user restrooms model along corridors will also free up space currently allocated to multiple stalls and a large common area. This is a 2018 code, yet architects can request variances or modifications from local code officials to adopt it now rather than later. State-wide adoption can also be considered through the Building Code Council’s office in each state.

Landlords Use Product Innovations to Enhance Building Brand Restrooms are becoming much cleaner, more accessible and pleasing environments from days when they were regarded as merely “necessaries” that were often unpleasant. Restrooms, in fact, have become part of a building’s brand, along with lobbies and hallways, a way of differentiating and showing tenants and visitors that building owners care about them and have style. Manufacturers are innovating in ways that help building owners achieve these goals. For instance, Leanna T. Hall, associate brand manager, at Rubbermaid Commercial Products, says, “We aim to be on the cutting edge of innovative technologies in our industry. These innovative products help us enable our customers to provide a pleasant experience in the restroom. This means creating a lasting impression for each and every facility’s patron, by presenting an odor-

Touch-free solutions protect the health of tenants and visitors in a building. Photo courtesy of Rubbermaid Commercial.

free, touch-free, and hassle free environment. All of our innovations are centered on the idea of protecting the health and wellbeing of our end-users while also optimizing the productivity and cost-savings of our choosers through environmentally sustainable technologies.” Jim Reinhart, a commercial products executive at American Standard Brands, has identified four major areas in which restrooms can be improved: smart water conservation, more aesthetic styling, cleanliness and increased fixture load capabilities. American Brands, for instance, offers a full range of water efficient commercial faucets, toilets, and urinals with high flush scores and excellent drain line carry performance. American Standard also offers several Californiamandated, pint flush capable urinals and the newest small category urinal which launches this summer. “When customers choose American Standard flush valves to use on our water efficient flushometer bowls and urinals, they achieve hydraulically matched systems to harness all of the water’s potential energy while also receiving a great five year system warranty,” says Reinhart. For customers that are looking for increased fixture load capabilities,

American Standard recommends wall-hung bowls which meet a 1,000 pound static load that is two times the code requirement. The company addresses cleanliness with its EverClean surface, a doublecoat glaze surface that is two times smoother than ordinary fixture surfaces which means it helps to continuously repel dirt and grime. It also includes antimicrobial properties that inhibit the growth of stain and odor-causing bacteria, mold, and mildew on the fixture surface. Lisa Shimko, product manager, Moen Commercial, says, “Most of us have walked into a public restroom and noticed a faucet accidentally (Continued on page 22)

New Code Helps Resolve Transgender Bathroom Issues Section 2902.1.2 of the International Building Code was approved in March. It allows for all restrooms and bathing rooms to be built single-occupancy and gender-neutral and: z Helps the restroom and bathing room use for the 700,000 transgender population in America; z Allows signage on all existing single-occupancy restrooms to be changed from “men” “women” to gender-neutral; z Reduces waiting lines for everyone known as potty parity; z Helps the 21 million Americans with shy bladder syndrome function in society; z Helps opposite-sex parents and caregivers waiting outside of multiple-occupancy restrooms or bathing rooms creating safer environments; z Often reduces square footage, construction costs and building energy consumption.


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22 California Buildings News • May/June 2016

Restrooms (Continued from page 19) dispensing features to help facilities minimize soap, being left on or thought about all the germs. water and towel usage — thereby saving on costs— Sensor-operated faucets can save facilities money improved sensor technology to enhance the end-user and improve hygiene. Since faucets only turn on when experience, as well as modern designs, making them hands are placed beneath and turn off immediateeasier than ever to integrate into existing washrooms.” ly after, there is potential for water savings — good for the environment and a Restrooms Enter Digital Age facility’s bottom line. In Digital solutions are also making their way into addition, the Global the restroom. Products leader Tork says in a stateHygiene Council ment, “People increasingly says, a public rely on data to help them Sensorbathroom faucet work smarter, not harder. handle can house operated That’s why it’s not surprisup to 6,267 bacing that building managers faucets teria per square are implementing technolinch. The handscan save ogy to maintain spaces that free capabilities tenants visit multiple times facilities help reduce germ daily, ensuring clean and transmission, keepwell-maintained facilities money and ing the faucet cleaner for improved satisfaction.” improve longer.” Jimy Baynum, director “Expect the no-touch of market development hygiene. washroom trend to conat SCA-AfH Professional Since faucets tinue building, especially Hygiene Business, says, for facilities with tenants, “It’s vital for businesses only turn on when hands are clients and customers in to promote good hand placed beneath and turn off the younger generation hygiene and help miniworkforce, who today not mize germ spread. The immediately after, there is only prefer these amenities IoT megatrend is bringing but expect them,” says potential for water savings— restrooms into the digital Robert Paul, marketing age and data-driven, intelligood for the environment and a category manager for soap gent restroom systems can dispensing and healthfacility’s bottom line. In addition, now notify cleaning staff care, Bobrick Washroom the Global Hygiene Council says, when hand towel and soap Equipment, Inc. product levels are low and “From a hygiene standa public bathroom faucet handle signify refills. By ensuring point, the benefits of autohand hygiene products are can house up to 6,267 bacteria matic towel dispensers, consistently available, smart hand dryers, soap dispens- per square inch. The hands-free restrooms help businesses ers and faucets are well increase hand hygiene capabilities help reduce germ known. Today’s newer compliance.” n no-touch accessories transmission, keeping the faucet also feature customizable

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Buildings People... Let’s Keep the Conversation Going! Join our LinkedIn Group: California Buildings News. We appreciate your feedback, as it gives us good story ideas and members of the group appreciate your thoughts and comments. Reminder: You may access the digital versions of all current and past issues of California Buildings News from our website, www.cabuildingsnews.com


25 California Buildings News • May/June 2016

LA Green Conference Highlights Area Progress LADWP is getting rid of coal as a source of energy and eliminating the use of ocean water for cooling. The City of LA is making sustainable landscaping, In some respects, the Municipal transportation assistance and building “green” a Green Building Conference and Expo priority. Getting capital funds to build high-performing this spring in Los Angeles felt like an green buildings is not as challenging as it is to procure annual summer camp reunion. We all funds for maintaining these buildings. Weintraub says, have a shared experience in building “it is sad to see these great green buildings deteriorate over the sustainability of our Los Angeles just a few years.” Throughout the day, presentations taught community. Many attendees have us lessons learned about the LEED Volume program (proudly known each other for years, and we presented by yours truly and co-presenter Sharla Shimono were all here to get acquainted with of Kilroy Realty), brought us up to date on the DOE’s Asset the latest and greatest happenings. Score, which is essentially a This year’s MGBCE had an extra portfolio manager for energy special buzz to it, as Los Angeles efficiency audits, and told us is the host city of the quickly how the owner of the LA Lakers approaching USGBC Annual is building its new training Greenbuild Conference. The facility to the LEED Gold stanMGBCE, hosted every spring by dard while emphasizing it is the Los Angeles Chapter of the “all about basketball.” The new United States Green Building facility will combine office space Council and the Southern with the training and perforCalifornia Gas Company, mimics mance functions of the space. Greenbuild by hosting keynote Having the mascot run into speakers, break-out sessions, someone from the accounting exhibitors, and of course, a happy department in the breakroom hour. The MGBCE, however, is is the kind of organized chaotic a free event. It provides a loveThe well-attended MCBCE conference was sponsored by California excitement the owner wants to ly locally sourced buffet lunch, Buildings News. Photo courtesy of USGBC LA. bring back to his operation. and attendees get to take home a The last session that I attendtomato plant to grow in their own ed started out with an economic lesson in waste water treatgarden. These are some of the special touches that we ment and escalated into a healthy debate between municipal “campers” especially love. water managers about the inequality of the distribution of This year’s topic was water conservation in the face of funding to water districts. Water treatment plants are receivdrought. I walked into the first keynote to catch Vincent Lee ing less water to treat, due to the drought and to conserof Arup talking about cities and communities that have intevation. But although this is a move in a positive direction, grated water management into their resiliency plans just as without the waste water the plants were designed to receive, he said, “and they had a blackwater treatment program, obvisediment and odors increase. Community members do not ously…” The entire audience reacted with a simultaneous want to pay more money for conserving more water, but the gasp and smile, thinking that blackwater treatment could one retrofits necessary for water treatment plants require money. day be something so obvious every community will have one. And it may be the case that the poorer communities with Midday we heard from the public sector leaders Dan fewer resources have water districts that are not as well fundBurgoyne of CA DGS, Nancy Sutley of LADWP and ed as some of their wealthier neighbors. But without coordiDeborah Weintraub of the City of Los Angeles. Each nation between the 80 small water districts, the true picture admitted that their agencies have the responsibility of leadof the inequality is hard to see. ing by example and each owned up to needing to get their All in all, this year’s MGBCE helped generate excitement own houses in order. DGS’ $10 billion procurement program for the Road to Greenbuild as well as it stood on its own as a intends to “green” their state contracts including purchases worthwhile day of learning spent among peers. from CA Highway Patrol helicopters to food for prisoners.

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Handy is a CodeGreen consultant and prominent leader in California’s sustainability movement.


26

Association News

California Buildings News • May/June 2016

“Always Raise Your Hand” … IREM Leaders’ Advice Senior CRE Executives Share Career Guidance at Conference Younger and mid-management property managers seeking career advice got valuable tips from a panel of top commercial real estate executives at the “Invest in Success: Southern California Real Estate Conference,” sponsored in May by the Institute for Real Estate Management (IREM) Orange County. Panel at IREM Conference: George Meyer, Irvine Company Office Properties; Strongest recommendations were that aspiring Paul King, CBRE; Janice Fuches, Vestar; and Charles Hobey, Equity Office. executives should “always raise your hand” and volunteer, said Vestar’s Janice Fuches, a suggestion endorsed by CBRE’s Paul King and Equity Office’s Charlie Hobey in their comments to the audience. In a wide-ranging discussion, the respected leaders offered the tips below for success and better property management.

California Builder News Salsbury Industries

Runs in:

w Create your own opportunities by surveying career Jan/Feb, May/Jun, Sep/Oct openings in your area and even throughout the country. w Realize that your current client might one day be your employer.

w Volunteer for assignments and responsibilities—

even if you don’t have all the necessary qualifications. w Take on additional duties beyond your specific scope of work. w Think team success and strive to improve the performance of each member of your team, providing them with the resources they need to do their jobs. w Realize that increasingly flat organizations require people to wear many hats well. w Discharge employees that drag down the entire team and poison the work environment— after you have done all you can to help them succeed without results. w Known that ultimately each employee’s goal is to generate revenue. w Strive to prioritize responsibilities, instead of just responding to the last demand made on you. w Property managers should view themselves as CEOs of their responsibilities. w Try to establish concrete goals for employees so they will understand their duties. w Don’t forget to have fun with your co-workers…and open a bottle of wine with them from time to time. w Review performances periodically — either formally or informally. w Get a mentor— or be a mentor — and access others’ life experiences and advice. w Ask lots of questions. It shows you care and want to better perform. w Listen to people you’re supervising. And make sure their issues are dealt with. w Don’t stereotype people…like “Millennials.” Everyone is unique.


27 California Buildings News • May/June 2016

ADA Lawsuits Swamp California Recent Remedial Legislation Promises to Alleviate Some Issues California comprises 12 percent of the U.S. population, but its companies and organizations are hit by a whopping 40 percent of lawsuits brought by people who say their rights under the Americans with Disabilities Act have been violated. This according to the Building Owners and Managers Association of California. BOMA says, “Reforming the law has proven difficult, both at the state and federal levels. However, over the last few years the commercial real estate industry has worked closely with legislators and the governor to move forward several reforms that will curb lawsuit abuse while promoting increased compliance with disabled accessibility codes.” Governor Jerry Brown just signed into law SB 269 with the following features: u Establishes a presumption that certain “technical violations” are presumed to not be a cause for action. u Applies to small businesses (25 or fewer employees) u Business has 15 days to correct the violation u Technical violations include non-access issues such as wording and placement of signs, lack of signs, order of signs, color of signs and parking stripes, paint issues (faded, chipped, etc) on otherwise compliant parking spaces, certain warning surface issues. u The law states that the above presumption affects the plaintiff’s burden of proof and is rebuttable by a preponderance of the evidence showing that the plaintiff did, in fact, experi ence difficulty, discomfort, or embarrassment on the particular occasion as a result of one or more of the technical violations. u Protects certain businesses from liability for minimum statutory damages in a construc tion-related accessibility claim made during the 120-day period after the business obtains an inspection of its premises by a CASp, under specified conditions.

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28 California Buildings News • May/June 2016

Association News

San Francisco Area Architects’ 2016 Design Winners This year’s American Institute of Architects San Francisco Design Awards winners celebrated the best in historic preservation, urban design and social responsibility with 19 awards given during a ceremony that occurred in the beautifully redesigned Herbst Theater. And the winners included …

• Brecon Estate Winery, Aidlin Darling Design, LLP Citation Awards: • San Francisco Public Safety Campus, HOK + Mark Cavagnero Associates • Don Fisher Clubhouse, TEF Design • The Tower at PNC Plaza, Gensler Interior architecture awards: Honor Awards: • Bloomberg Tech Hub, Honor Awards: IwamotoScott Architecture, LLP • Stanford University, Stanford • Skyhaus, Aidlin Darling, Energy Systems Innovations, Design LLP ZGF Architects War Memorial Veterans Building. Architect: San Francisco Public Works, Merit Awards: • College of Marin Academic Building Design & Construction + Carey & Co. Photo credit: Brian Wong. • Coblentz Patch Duffy and Center, TLCD Architecture + Bass, Gensler Mark Cavagnero Associates • San Francisco International Airport, Terminal 3, Boarding Area E, • University of California, Lawrence Berkeley National Laboratory’s Gensler, Hamilton + Aitken Architects, Robin Chiang & Co. Chu Hall, SmithGroupJJR Citation Awards: Merit Awards: • The Strand, ACT, Skidmore, Owings & Merrill LLP • Rinconada Library, Group 4 Architecture, Research & • Children’s Day School at Dolores Park, Jensen Architects + Planning, Inc. VerPlanck • North Beach Branch Library, Leddy Maytum Stacy Architects Special Commendation: Historic Preservation: • War Memorial Veterans Building, San Francisco Public Works, Building Design & Construction + Carey & Co. Urban Design: • Whole Foods Market on the Alameda, Field Paoli MARKETT MANAGE ! ION T • Blue Barn Theatre and Boxcar 10, Min | Day C E NN CO HE T Social Responsibility: KE MA • 474 Natoma, Leddy Maytum Stacy Architects SUSTAIN • Half Moon Village Affordable Senior Housing, Herman Coliver BUILD DESIGN Locus Architecture Sustainability: • Jacobs Institute for Design Innovation, Leddy Maytum Stacy 8TH ANNUAL AEC Architects

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29 California Buildings News • May/June 2016

Stanford Energy Systems. Firms: ZGF Architects and Affiliated Engineers, Inc. Photo credit: Matthew Anderson.

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30 California Buildings News • May/June 2016

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31 California Buildings News • May/June 2016

Cautious Optimism...

Multifamily Real Estate Summit Watchwords By Steve Ring The future of Northern California’s multifamily housing market depends greatly on infrastructure improvements, better mass transportation, intelligent regional planning that offers opportunities for suburban development and— of course —a steady flow of capital. Building owners, developers, lenders, brokers and people in the commercial real estate industry wanting to understand where we are going in this economic cycle gathered recently at the EisnerAmper Real Estate Equity Summit West in San Francisco. Yat-Pang Au is the CEO and founder of multifamily owner Veritas, a major owner of multifamily real California Apartment estate throughout the Bay Area from Illustration: Getty Images. has gone from 130 to 4,000 units in the Bay Area since 2010. He said growth was difficult, but noted that scaling was one of his biggest challenges. “Being able to keep communications open to all levels of the firm was key and weekly all-hands meetings were essential.” One of Veritas’ biggest deals was buying a piece of the Lembi portfolio located in San Francisco. “This allowed us to grow tremendously in San Francisco, however, maintaining quality was labor-intensive on these, mainly, 20 units or less in size buildings.” He expressed interest in opportunities in smaller housing stock with non-institutional owners. The focus of Veritas, with its in-house architects and space designers, is to design for the Millennial population with amenities such as Zipcars, outside space and similar design elements. Being near mass transportation is a key element also. Looking ahead in real estate was a panel whereas Mark Carlson, managing director for Stockbridge, was more concerned than most of the other panelists with comments about the waning venture capital interest in tech firms lately.

With those concerns, “a slow-down could be imminent to the Bay Area in terms of tech tenants leasing more space,” he said. Carlson said sellers thinking about selling should so do “right away” and be looking to the suburbs, as Stockbridge has done. Matt Field, TMG’s chief investment officer, wasn’t as concerned about the economy ahead. Field said the slowdown was just cooling a very hot market. Infrastructure and affordability, he said, are the two biggest problems in the Bay Area right now and access to transportation will be key to future developments. Jake Lehmkuhl, executive vice president of California Bank and Trust, said the market is in good shape and seemed bullish about suburban opportunities. Matt Lituchy, Jay Paul Company’s chief investment officer, said “prices Owners Are Optimistic are now to perfection,” noted jobs are still growing and showed no concern about the economic future. He also observed that the Millennial generation will eventually have children and will be looking to the good school systems located in the suburbs but noted that transportation to and from these locations will be key.

Planning an Uncertain Future? Paul Odland, founder and managing partner of Belveron Real Estate Partners, expressed concern about the volatile national political arena and the upcoming elections as it affects local real estate. He said affordable and public housing are not being built at the rate they should due to the NIMBY attitude throughout the Bay Area. Orland said policy change would create “opportunities for our industry.” Marc Perrin, a managing partner for The Roxborough Group, said hospital growth and senior housing will be the big factors in the upcoming decade. “As the population is aging, we don’t have the current capacity to meet (Continued on page 37)


32 California Buildings News • May/June 2016

Industry News

LA’s Pershing Square Park Designer Chosen

Los Angeles City Councilmember José Huizar revealed the winner of the international design competition to reimagine the five-acre park at the heart of Downtown Los Angeles: Agence Ter and Team. The proposal drew the highest scores from the 1,355 members of the public who weighed in on the four finalists and was the unanimous first choice of the Pershing Square Renew jury. One of the most notable features of the winning proposal was what Agence Ter’s founder and director described as “radical flatness.” While the current-day park sits elevated atop a parking garage, with stairs and ramps linking it to the street around parking garage entrances, the new design lowers the top level of the garage to street level, creating views and paths from Fifth Street to Sixth Street and from Olive to Hill. A reflecting pool on the west side of the park mirrors the stately Biltmore Hotel, and an iconic “smart canopy” designed by artist Leo Villareal lights up at night and provides shade during this day. The full proposal may be downloaded at http://bit.ly/1OfQdlu. Other features include water cycling and alternative energy systems; a welcoming balance between light and shade; programmable, flexible space; and landscaping that creates a welcoming ecology with gardens, grasses and lawns. (Shown above: rendering of the park and its smart canopy at night.)

Offices Aren’t Built to Benefit Employees, Says National Survey

A national survey of 400 office workers revealed many have limited access to daylight, experience poor air quality and uncomfortable temperatures and are distracted by too much noise in their workplace. The findings point to a need to improve the quality of the office environment nationwide by creating spaces that are built to benefit employee well-being, which can have a significant Insufficient access to daylight, poor air impact on productivity, and ultimately, a company’s bottom line. quality, distracting noise widespread The survey was conducted by Saint-Gobain, one of the world’s largest building materials companies, and its subsidiary SageGlass®, the pioneer of the world’s smartest electrochromic glass, today announced the results of its 2016 Work Environment Survey. “The office environment is one of the most important elements of any company because it significantly impacts the most valuable asset—employees. With workplace satisfaction and productivity at stake, we believe it’s time workplaces reflect their significance,” said John Crowe, president and CEO of Saint-Gobain and CertainTeed Corporations. “For this reason, Saint-Gobain recently opened a new 65-acre North American headquarters that is designed to improve the quality of our employees’ lives and,


33 California Buildings News • May/June 2016

AEC Leaders “Terrified” at Lack of Talent — Too Few AEC Professionals A just-released study by the Society for Marketing Professional Services warns in its “SMPS 2016 Fellows Study” that architectural, engineering and construction companies face a depletion of able staff that threatens quality performance. The study was conducted by the association’s most esteemed leaders throughout the U.S., including Dennis Paoletti of San Mateo, Thomas Smith of Chino Hills and Francis Lippert of Sacramento. “Fellows are terrified about the extreme lack of talent entering the industry—at all levels and in all roles. Imagine a world in which your company is hired for a marquee project, only to have to decline the commission because you can’t find enough staff to work on the project? For many firms, that nightmare is already coming true. And unless the national dynamics change, this could be a nightmare without end. Marketers, let this be a call to arms! Your firms are desperate for knowledge, whether they know it or not. Take initiative! Chart your course. Be a force of positive change—not just in your firm, but in the A/E/C industry. Make environmental scanning a critical component of your job. Locate the trends and potential disruptors— not just impacting your company, but also impacting your clients. Siphon the data and interpret the findings. And then package this knowledge into regular, short summaries for your firm’s leaders,” according to the study. “The survey is a snapshot of the trends and predictions, both internal and external to our industry. In some ways, the findings are unsurprising. And yet, if you and your firms are not taking action now, the insights from the SMPS Fellows should serve not only as a wake-up call to get moving, but also a slap across the face. If you’ve been in the Architectural/Engineering/ Construction (A/E/C) industry for any length of time, you know how slow to change we can be. And yet, change is accelerating at never before seen rates, and for those firms unable to adapt to change rapidly, the future is a bleak place.”

in doing so, inspire them to create the next chapter of our 350-year innovation legacy.” One of the most impactful elements on employee well-being is natural light. In fact, nearly 9 in 10 (87%) survey respondents said they would prefer to work near a window most of the time. Despite this overwhelming desire to be exposed to natural light, 36% of office workers do not have a window near their workspace. Of those with access to a window, 65% have blinds or curtains that block sunlight at least some of the day. It’s not just sunlight being blocked, but the restorative benefits of the outdoors. In fact, 32% of those with window access rarely or never see pleasant vistas.

How Facility Engineers Deal with “Internet of Things” 65% Plan to Invest in Smarter Building Tech Facility managers are increasingly adapting their building maintenance strategies in response to the Internet of Things (IoT), with 60 percent of professionals predicting that IoT will impact their building and maintenance policies within Illustration: Getty Images. the next year, according to a new study commissioned by Schneider Electric. It also showed that 65 percent of respondents are also planning to increase investment in building capital expenses in 2016, including advanced building technologies that manage and glean insights from new data sets. While respondents indicated that IoT is taking hold within their business, challenges exist to taking full advantage of building data. Seventy percent of facility managers report that their building management staff is very or extremely skilled in data analysis, but only 27 percent utilize data driven analytics solutions in relation to building management according to the study. Key barriers to uptake include the level of investment required (39 percent reporting as a top concern) and the lack of internal resources available to interpret data into actionable results (31 percent reporting as a top concern). Another factor impacting the shift toward new building technologies is that only 26 percent of facility managers feel that available building information is totally adequate for facility maintenance planning. A majority of respondents cited room for improvement in this area, and only 15 percent reported they fully utilize predictive maintenance tools to proactively assess and target equipment maintenance. “The explosive growth of data, information and devices in today’s enterprises is dramatically impacting expectations of buildings and our relationships with them. Facility professionals need to be able to better visualize what’s happening across their footprint and make educated decisions to correct and improve conditions,” said Brett Wheless, Director of Field Services, Schneider Electric.


34 California Buildings News • May/June 2016

Revolutionary Lighting Strategies

(Continued from page 10)

LED panels used in an office setting. Photo courtesy of Arani Systems Corp.

gained compared to a lighting system that was converted three or four years ago. Third, LEDs offer great flexibility of design in specialty applications, giving architects more license for decorative and accent lighting. Couple this with the Internet of Things and integration of technology communications, and LED becomes very attractive to the high end building market.”

Other Lighting Solutions Are Driving Efficiencies Sean Arani, president of Arani Systems Corp., says “Everyone wants to reduce their energy consumption and costs, but sometimes switching off or dimming the lights isn't an option. Imagine walking in a hallway with no lighting. LEDs can be left on 24/7 at a fraction of the consumption of traditional technologies. Hospitals, offices, and schools all benefit from LED technology's high power lighting while cutting down on their energy usage.” “The adoption of lights with embedded sensors is a no-brainer in the commercial space," said Neil Joseph, founder and CEO of Stack Lighting.”Connected lights with sensors allow for energy savings through daylight harvesting and occupancy detection, complete building controls from anywhere, and high-resolution building analytics. Stack lights can be installed in any building and users save on installation costs — when the sensors are embedded and the fixtures are plug-and-play, there is no need re-wiring or construction.” “Electrolube products are utilized within LED designs for improving product performance and efficiency as well as offering a high level of protection in harsh environments. Focusing on improved efficiency, the operating tempera-

ture of an LED is directly related to its lifetime. Thermal management products in the form of interface materials provide the maximum level of heat transfer from the LED to the heat dissipating surface by removing any air voids. Thermal management pastes can be applied in very thin films resulting in very low thermal resistance at the interface and thus maximizing the efficiency of heat dissipation,” says Electrolube’s Jade Bridge, global technical support manager. “Other thermal management products on offer can also provide adhesive properties and overall protection. For example, an LED driver can be protected from the surrounding environment by the use of an encapsulation resin. In this case, the encapsulation resin is thermally conductive, helping to dissipate heat and reduce the operating temperature of the driver. In addition, the resin fully encapsulates the PCB, protecting it from harsh environments, allowing long term use in outdoor conditions. The ongoing trend for product miniaturization, coupled with more modern high powered devices, has ensured that efficient thermal management is an essential part of both modern and future electronics, the LED market being a prime example of this,” Bridge continues. Meantime, LED lighting is surging in the marketplace. According to the National Electrical Manufacturers Association (NEMA), “LED A-line lamps posted another strong showing to start 2016, surging 375.9 percent during the quarter on a year-over-year basis. Meanwhile, halogen A-line lamps posted a year-over-year increase of 7.4 percent, while incandescent A-line lamps decreased by 14.2 percent and compact fluorescents lamps (CFL) dropped 49.0 percent. Compared to 2015Q4, LED shipments rose 38.5 percent, while halogen A-lines decreased 13.3 percent. CFL shipments saw a quarter-to-quarter decrease of 24.3 percent and incandescent A-line lamp shipments decreased 21.3 percent. “LED A-line lamps increased their sales share by nearly nine percentage points between the end of 2015 and 2016Q1, and now comprise 26.1 percent of the consumer lamp market. Halogen A-line lamps accounted for almost half of all consumer lamp shipments in 2016Q1, at 46.5 percent, but saw their share decline in the latest quarter. CFLs captured a 19.2 percent share and incandescent A-lines a 8.2 percent share,” said NEMA. Bet on the future. Bet on LED. n

(See page 12 for more about LEDs.)


35 California Buildings News • May/June 2016

Lighting Strategies for Aesthetics

(Continued from page 11)

required to create dynamic color scenes on the building, but were not able to tune to a neutral enough white to adequately illuminate the building during non-celebratory evenings. Arup worked with Philips to create a fixture that was composed of both tunable white and RGB LEDs, allowing maximum flexibility. “Following the choice in manufacturer, design commenced to lay out control signal cable, electrical transformer locations, mounting details that did not harm the historic facade, additional rooftop fixtures for more uniform distribution on the dome and in the top lantern, and dynamic scene programming.”

throughout the day, allowing the occupants to spend their time on other matters and making them more productive. These can create beautiful decors that can be easily and quickly changed to suit a client’s particular mood at that moment. “This enables creativity and appreciation of an environment because it can be constantly changed with ease, unlike the hassle involved with other ways to modify a space like repainting.”

Jules Gim, a Callison RTKL architectural lighting designer, says, “With the constant advancement in LED technology, light fixtures are becoming smaller OSRAM’s Lighting Garden Spots enhance outdoor environments. in scale, yet more Photo courtesy of OSRAM SYLVANIA. powerful than ever. LED Creates Wide We can successfully integrate them into ever smallRange of Design Options er spaces. A dimmable LED option is now often a Says OSRAM SYLVANIA’s Aaron Ganick, “Light has standard feature, which means retailers can vary a powerful and meaningful impact on an environlight levels, if desired, to match time of day or for ment, and now there are new exciting tools availspecial events to match the mood. As an added able for architects to better serve their clients and bonus, high performance LEDs are more efficient set themselves apart from the competition. Smart than ever before, saving costs to the client.” connected lighting, such as LIGHTIFY from OSRAM IA Interior Architects Senior Lighting Designer SYLVANIA, gives architects the ability to leverage Gary Bouthillette says, “At IA, the design gametheir creativity and enhance their clients’ environchanger of newer LED technology has been ments with customizable, user-friendly, intelligent that it has liberated the form factor of the indoor and outdoor lighting solutions that are very components in our lighting design palette. Firstaffordable. generation LED luminaires were often just fluores“Using the LIGHTIFY app or switch, an architect’s cent ‘boxes’ with a new light source inside, but in client can easily change their light from warm to the last couple of years designers and manufacturcool and bright to dim, or to thousands of colors to ers have really figured out what this light source suit their mood and use of the space. For example, can really do to transform interior space without a bright white can be set to encourage alertness doing it one four-foot lamp at a time.” during the day, while a warm white in the evening What’s the future of LED-enabled design? The can create a relaxing ambiance. Additionally, these choices are measured in millions of hues. n changes can be scheduled to occur automatically


36 California Buildings News • May/June 2016

Marijuana (Continued from page 16) require Public Housing Authorities and owners/operators of HUD subsidized housing to establish standards for current residents found to using medical marijuana and state that those standards can include eviction. Conventional and other affordable (non-HUD subsidized) properties may face the most risk when determining how to implement medical marijuana prohibitions or restrictions on the property, due to fair housing law which requires landlords to provide reasonable accommodations to persons with disabilities. The question is whether it is reasonable to allow residents to use marijuana for medical purposes as an accommodation for their disabilities. This can be further complicated by a situation where there are no smoking rules at a property but medical marijuana is allowed as an accommodation. If there is someone living or working nearby with asthma, you then have conflicting disabilities, which are difficult to resolve. The question of whether medical marijuana is a reasonable accommodation was tested in a California Supreme Court case—Ross v. RagingWire Telecommunications— which addressed allowing the use of marijuana as a reasonable accommodation in the context of employment. The decision was that the Fair Employment and Housing Act (FEHA) “does not require employers to accommodate the use of illegal drugs” and CA medical marijuana law does not give

any person a “right to use marijuana free of hindrance…” While this decision applies to specifically to employment, and not housing, it could be argued that this decision can also be applied to non-HUD subsidized housing. There are continuing efforts at both the federal and state level to further legalize marijuana, and it is most likely to be legalized in California. At the federal level, the most likely change to occur would be to classify marijuana as a Schedule II drug, which would recognize its medical benefits, but not legalize it. In any event, now there are unanswered questions remaining as to whether or not, and to what extent, a landlord may refuse medical marijuana While strong reasons for allowing the blanket prohibition of marijuana in all property types exist, such as that marijuana remains illegal at the federal level, that it violates the rules and regulations of the property and could be argued to be an unreasonable change to the owner’s practices, these arguments have yet to be tested in our state and federal courts. Before determining how to proceed, a meeting with an attorney knowledgeable in this area is highly recommended. n (This information was presented at an IREM San Francisco luncheon by the Bay Area law firm Kimball, Tirey & St. John LLP. Members of the firm can be reached at http://kts-law.com)

Katherine A. Mattes is a real estate consultant and can be reached at www.kathymattes.com

Emergency Preparedness (Continued from page 7) power is restored, potentially damaging your equipment. If the event lasts for many hours, go home and stay home until power is restored and you are cleared to return, especially if it continues for several days. The generators only run to operate just the essential systems of the building until power is restored. They will supply enough power to run the building in normal mode. However, many will only run 8 to 12 hours until they run out of fuel so unless they are refueled then the building will go totally dark once the tank runs dry.”

support at least 1-foot candle on the path of egress to safety. This system has the ability to self-diagnose itself and notify management of any issues, and it supports the existing lighting style. In smaller structures a term called ‘battery pack’ can also be used to support a smaller foot print of lighting that is dedicated to a path of egress or they can also use an emergency lighting product that has a battery pack already installed in the unit to support the self-contained lighting,” says Steve Walker, regional vice president, Barron Lighting Group.

Path of Egress

Harbro’s Ryan Rusler, an Oakland area emergency preparedness authority, notes, “Creating procedures during a disaster is never a good place to be, and all employees will inevitably fall back to

“In larger structures, a UPS system (Uninterruptable Power System) is installed with the existing lighting system within the structure, and it can

Advanced Planning Needed

the level of their training. Best practices start with setting expectations with all vested parties in the first 60 seconds. Is it safe to engage backup power? What are our main life safety concerns and how can we prevent/minimize? What does backup power cover? How long can we use backup power? What is our plan when that runs out? Who do we notify (internally and externally)? What is our corporate public relations plan?” If your building doesn’t have a comprehensive plan for dealing with extensive power outages, consider attending seminars and conferences regularly put on by your area Building Owners and Managers Association, International Facility Management Association chapter or an Association for Facility Engineering group. All provide training and useful information. n


Industry News

37 California Buildings News • May/June 2016

Santa Monica Votes in Aggressive Renewable Energy Requirement The Santa Monica City Council has approved an ordinance requiring rooftop solar systems for all new construction in the City of Santa Monica — both residential and commercial. The ordinance goes into effect in June and continues the city’s history of adopting local requirements that advance the transition to high-performance, green buildings for all. The timing of the ordinance capitalizes on market trends in the solar industry. With the cost of solar installation continuing to decrease, Santa Monica residents and developers will now generate cost-effective renewable energy, improve the value of their property, and contribute to the City’s robust long-range goals for energy and climate mitigation, including reaching carbon neutrality by 2050. “In Santa Monica we are moving away from buildings powered by fossil fuels in favor of clean and cost-effective solar energy,” states Dean Kubani, Santa Monica’s Sustainability Manager.” This is not only the smart thing to do, it is also imperative if we are to protect our kids and grandkids from the worst effects of climate change.” Image: Getty Images.

Real Estate Summit (Continued from page 31) the needs, he said. Melinda Ellis Evers, a managing principal of Ellis Partners, saw “great potential” in the Bay Area due to the international desire to invest in this area. Unfortunately, many local players have been priced out, but on an international scale current prices can make sense for different motivations. Recent challenges in the industry include the cost of building, costs driven often by the state’s Title 24 green requirements. The general feeling of the speakers and attendees

was that this is a very cautious year, and everyone is looking for the canary in the mine that will tell us to tap the brake or press harder on the accelerator. But compared to the last two downward cycles, we have more well-established tech firms, like the Google and Saleforce.coms and many more international buyers interested in the Bay Area market. We also have more cranes in the sky and developers are working as quickly as possible to deliver their product to the marketplace.

Ring is chief financial officer and a principal of Fulcrum Real Estate Development and a Bay Area real estate industry leader. He can be reached at steve@fulcrumredev.com


38 California Buildings News • May/June 2016

TOBY Winners (Continued from back page)

Category: Office Building 250,000–499,000 Square Feet 201 Spear St., San Francisco Management: Cushman & Wakefield

Category: Office Building 500,000– 1 million Square Feet Westwood Gateway II, Los Angeles Management: Irvine Company

Category: Office Building Under 100,000 Square Feet The Sunset, West Hollywood Management: Transwestern

Category: Retail Building FIGat7TH, Los Angeles Management Company: Brookfield

Category: Suburban Office Park Mid-Rise Kilroy Airport Center Long Beach Management Company: Kilroy Realty Corporation

Category: EARTH Award San Gabriel Valley Corporate Campus Management Company: CBRE

Category: Medical Office Building 450 Sutter Street, San Francisco Management Company: Harsch Investment Properties

Category: Suburban Office Park Low-Rise Stoneridge Corporate Plaza, Pleasanton Management: Next Play Consulting


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Regional Award-Winning California Buildings Advance to International Competition Inspiring buildings in Northern and Southern California have earned awards for excellence. They were awarded TOBYs (“The Outstanding Building of the Year� Award) in the Pacific Southwest Region from BOMA (Building Owners and Managers Association). They now move on to the international competition, with winners announced at the BOMA International annual conference in late June (winners announced in our next issue). Congratulations to the outstanding buildings shown below!

Category: Best Office Building Over 1 Million Square Feet One Market Plaza, San Francisco Management Company: Paramount Group, Inc.

Category: Historical Building 5670 Wilshire, Los Angeles Management Company: Equity Office

See more page 38 for more California TOBY winners!

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