Californiabuildingsnewsjf2015

Buildings of the Future

January/February 2015 • $5

California Industry Leaders Offer Unique Insights

Workforce Shortages Plague Industry

LA Architects Achieve Political Goals

Buildings: A Family Business

Features New Year’s Resolution Tip: More Networking For the editor of a magazine about buildings, attending association events is absolutely essential to my understanding of the countless aspects of the design and operation of buildings ranging from offices to hotels, hospitals, factories, apartment complexes and so on. The property and facility managers, architects, contractors, product and service providers experts who attend seminars, workshops, monthly luncheons or receptions are the ultimate sources of information. Those of us who produce California Buildings News are always happy to be invited to attend such events and report on as many as we can— to share the wisdom. An event may attract as many as 200 people, but what’s said and done there—through our reporting—can reach many thousands more as well as projecting your association’s brand, boosting membership.

Everyone involved in the industry should attend meetings of buildings industry associations and conferences. It’s the best way to engage with other professionals, learn from leaders and—last but not least—do a little business. I am often surprised sometimes to see so many people operating in silos, rarely experiencing the benefits and pleasures of networking.

So here’s a list of some of our favorite associations in California.

Make it your New Year’s resolution to attend some of their functions and consider joining and participating in committee work. You’ll be glad you did. w American Institute of Architects: http://www.aia.org w Association for Facilities Engineering: http://www.afe.org w Building Owners and Managers Association: http://www.boma.org w California Apartment Association: http://www.caanet.org/ w California Hotel and Lodging Association: http://www.calodging.com/ w Corenet: http://www.corenetglobal.org/ w CREW: https://www.crewnetwork.org/About_CREW_Network.aspx w Illuminating Engineering Society: http://www.ies.org/ w International Facility Management Association: http://www.ifma.org/ w Institute for Real Estate Management: http://www.irem.org/ w Society for Marketing Professional Services: http://www.smps.org/ w Urban Land Institute: http://uli.org/ w U.S. Green Building Council: http://www.usgbc.org/ Also, let me give a big shout-out to some of the worthwhile upcoming conferences and events our magazine is sponsoring: w Facilities Expos (March 18-19 in Modesto, May 20-21 in Anaheim and Sept 24-25 in Santa Clara) w Technology Convergence Conference (Feb. 26 in Santa Clara) w TOBY Awards (Feb. 12 BOMAs SF and Oakland/East Bay in Oakland) w BOMA Innovative EARTH Awards Luncheon (April 23 in San Francisco) w American Institute of Architects Annual Convention (May 13-17, Atlanta) The buildings world is changing so fast, given new technology and government laws and regs and constant personnel changes. The best way to keep up is to be involved with relevant associations on the local, state and national level. See you there!

Henry Eason, Editor (henry@easoncom.com)

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Buildings of the Future

CRE: Family Business

18

Association News

Terror Insurance: Do You Need it?

22

14 20

Buildings Can Make People Sick

Silicon Valley Multiplies Apartments

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California Buildings News Team Ellen Eason, Publisher ellen@easoncom.com Henry Eason, Editor henry@easoncom.com Contributing Editors Zachary Brown, CBRE Bob Eaton, Eaton Hotel Investments Jessica Handy, CodeGreen Solutions David Hysinger, San Francisco State University College of Business Rich Lerner, Construction Consultant Katherine A. Mattes, Real Estate Consultant Larry Morgan, Facilities, SAP Carlos Santamaria, CEES-Advisors

Advertising Information Ellen Eason, ellen@easoncom.com 415.596.9466 © Copyright 2014 Eason Communications LLC PO Box 225234 San Francisco, CA 94122-5234 • 415.242.5244

www.cabuildingsnews.com

3 California Buildings News • January/February 2015

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4 California Buildings News • January/February 2015

Industry Profiles

Workforce Challenges Too Great for Firms to Address Alone Q&A with Diane Coles Levine

Workplace Management Solutions, Long Beach, and Chair of the International Facility Management Association Foundation How serious is the looming workplace shortage in facilities management?

There is a lack of trained facility management (FM) professionals entering the workforce. The average facility manager is 49 years old. In five-to-15 years, 50% of the existing FM workforce will retire. The IFMA Foundation provides FM accredited degree programs around the world. Approximately 2,000 FM students per year graduate from these programs, however the annual demand for just one firm is greater than this number. There is a nearly 100% placement rate for students graduating with an FM accredited degree.

As chair of IFMA’s Foundation, what is your group doing to meet the challenge?

The Foundation has created the Global Workforce Initiative which connects education, training, support services and credentials for FM in a manner that optimizes the progress and success of individuals with varying levels of abilities and needs. Individuals earn more marketable credentials, engage in higher levels of education and employment and achieve greater economic success. The Initiative engages national, regional and local business employers to help meet their workforce needs and strengthen their workforces and economies. FM educational programs address high school, community college and higher education institutions. The Initiative provides internships and scholarships of over $1.32 million since inception.

(Continued on page 8)

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Opportunities Exist for Young Architects Q&A with Antonio Garcia, Principal, A Squared Studios, San Diego Q: Congratulations on being named the “Young Architect of the Year” by AIA San Diego. What drew you to the profession and, with so many Baby Boomers retiring, do you see opportunities for young architects like yourself?

A: Always having had a creative mind from a young age, I was drawn to architecture by the creative process. The notion that you can strategically develop and spatially analyze a design which can be realized into a tangible form all while focusing on craft was highly intriguing and ultimately led me on this path. There are definitely opportunities that will become available as Baby Boomer architects begin to retire. However with the passion that many, if not all, architects have for the profession, I can’t image that they will retire at a traditionally expected age.

Q: I understand that the time it takes to receive approval for even small-scale developments in the San Diego area is getting tougher. Does that disadvantage smaller—but highly creative— firms that don’t have the financial wherewithal to ride-out extended review and approval processes?

A: Under a traditional architect-client contract, the schedule and timeframes are a burden for the client more so than the architect.

Each project is individual and with its own scope. As part of our service, we document a general path and schedule for the client in the early phases of work so that they are informed and can analyze the project budget while considering the many possible variables including project associated review periods. On the other hand, for “architect as builder,” it can certainly impact less established firms.

Q: Can you comment on the level of community resistance to innovative in-fill projects and, more generally, to greater density in established urban neighborhoods in a market that is among the least affordable in the nation?

A: People can often times be cautious of and opposed to change, especially when it comes to the built environment. I have experienced this resistance more than once. I believe people can fully support in-fill projects until it affects them directly. With many of our San Diego projects we have always taken the time and care to develop solutions to mitigate the impact on the surrounding community while still satisfying the clients programmatic goals.

6 California Buildings News • January/February 2015

Buildings of the Future...

Even Greener, Smarter and More Accommodating The First Question we should ask is whether we will need buildings in the future. As absurd as that sounds, increasing numbers of people do not seem to need or want to work in buildings designated for employment. Telecommuting, mobility, decentralization, proliferating virtual entities and global corporate hoteling are becoming popular. And many brickand-mortar companies are jamming employees into spaces, reducing the need for additional structures to accommodate a growing workforce. Given these trends, fewer new buildings are being erected and more existing structures are being repurposed in ways that reflect evolving realities.

What’s a developer and architect to do? Adapt. And that’s what most are doing all over California, with increasing numbers of buildings undergoing adaptive re-use as tenants start up, morph, get acquired, and acquire in endless merger-and-acquisition activity. Meantime, buildings are getting way smarter, driven by Internet-of-Things technology that harnesses vast streams of data run through countless sensors that turn structures into almost sentient beings that can be programmed to nearly think for themselves.

They will automatically know when to change lighting, temperatures, energy use, security, telecommunications and the myriad functions for which we need intelligent structures.

We are experiencing a renaissance of invention in what we do inside buildings. Entrepreneurs are moving from their kitchen tables and garages into communal incubating workplaces and even coffeehouses that rent workspace by the hour where unstructured collaboration occurs freely and at the pace of the runaway tech economy. And we have already seen giant corporate offices transmogrifying themselves into varieties of open-closed arrangements as suit functions and personality types. Architecture and socioeconomics have merged.

Meantime, owners and operators of commercial real estate, factories, hotels, apartment complexes, hospitals and so on are scratching their heads, white-boarding like crazy and pondering how they can keep ahead of these warping curves.

Add to all this new mandates — dictated by government agencies and sought after to achieve cost reductions — the driving imperative to function with less energy. Much less energy or none at all. And, finally, we are awakening to the fact that buildings can make us sick and unproductive, from schools to offices and multifamily complexes. We know that better designed buildings can make us happier, more creative, healthier and able to produce greater ROI for our employers.

It seems like every day someone’s coming up with a new product or process to improve buildings of the future. And so California Buildings News reached out to some of California’s most respected buildings industry leaders with the basic question: What will buildings be like in the future? Their replies vary widely, given their roles in the buildings world, but, collectively they posit a future that’s greener, bolder, healthier, more imaginative and challenging. Here are their responses.

7 California Buildings News • January/February 2015

New Tech Enables Fundamental Design Changes Henry Russell (Russ) Drinker, Managing Principal, HOK, San Francisco Advances in technology, communications and increased globalization are profoundly changing our daily lives. The world is increasingly interdependent economically, socially and environmentally. The rate of change will continue to accelerate exponentially. The design and construction industry must rethink how it works and what it makes. Buildings of the future will be reinvented in terms of what they do, what they are made of, how they are designed, built and operated and how they interact with the natural environment.

Programmatically, buildings will be designed with a multifunctional, loose fit that is adaptable at minimal cost and disruption to changes in use, technology and environmental conditions. The effect of sustainable design — reducing the impact of the built environment on the natural environment — will be dramatically increased.

Buildings will be constructed of exceptionally strong, lightweight multi-functional and sustainable materials that will be more efficient and less wasteful. Structures will be integrated into districts to share resources such as renewable energy, recycled water and recycled waste to form regenerative, climate positive communities.

Computational power and data analysis will drive integration of design, fabrication, assembly and construction. We will see a surge in new building materials and technologies stimulated by developments in nanotechnology, robotics and additive manufacturing. Mass customization will enable an explosion of creative expression at every scale of design, from doorknobs to superstructures. Buildings will be super smart and constantly adjust to balance environmental and individual user needs.

“Sustainability” Will Be Baked Into Buildings David Herd, Managing Partner – BuroHappold North America, Los Angeles By 2025 the word “sustainability” and green design will have disappeared as the methodology of sustainable design, supply and construction will be so fully embedded and integrated into the industry. Sustainability in its current form will evolve into a number of highly specialized disciplines, forming part of either the architect, engineering or construction teams.

Design, construction and operation integration will finally sync up into one 5d BIM model for design, manufacturing, scheduling, installation and operations which will significantly increase the amount of off-site prefabrication and robotic labor. We will achieve a greater alignment with the car, aerospace and supply industries. (See recent articles on Amazon warehouses.)

With respect to the actual building design, even greater focus will be on flexibility, adaptability with greater influence on workplace productivity, health, comfort and wellness.

Building elements will have lower embodied energy, will be more controllable by individuals with instantaneous crowd source feedback to the operations team, and will be more transparent in how they are meeting energy and water targets.

Finally, I believe the building of the future will be delivered by far more integrated and specialist teams— greater use of IPD and P3. The building of the future will be more like a Tesla— highly efficient, with performance and value underwritten by the supplier — and sexy!

(Continued on page 26)

8 California Buildings News • January/February 2015

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Levine Q&A (Continued from page 4) Why is an industry-wide campaign needed, instead of letting individual companies meet their own HR needs?

Buildings are smarter and require more advanced technical knowledge than the normal training programs companies provide. This is a community problem because poorly maintained buildings and infrastructure result in public safety issues. Buildings in every industry are in jeopardy of decay. What’s needed are education programs provided by IFMA including the FM accredited degree, certifications and high school education.

A community of business leaders, FMs, educational institutions, economic developers, government agencies and workforce development experts are needed to solve the FM talent gap.

Have you had any success stories you can mention?

Zig Wu was studying medicine at Oxford and his grandfather was taken ill and wound up in an intensive care unit of a hospital. The design of the hospital was so depressing and inefficient, Zig decided to study facility management to ensure that he created better hospital experiences for patients through good design. His scholarship enabled him to complete his masters in facility planning at Cornell University. Zig is now a facilities planning consultant at Jacobs Engineering.

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10 California Buildings News • January/February 2015

Talent Shortages Threaten Buildings Industry Industry Associations, Leading Firms Develop Strategies to Avert HR Crisis

F

aced with a perfect storm of California’s economic boom and Baby Boomers leaving the workforce in droves, there is a growing shortage of experienced people who operate, design, build and serve buildings

Bay Boomers are retiring in record numbers, creating shortages that must be filled by aggressive HR development and educational programs.

in various ways. If steps aren’t taken to beef up workforces, building occupants could suffer a variety of problems and degraded service.

“The crisis with sustaining our workforce in commercial real estate is not looming — it is here!” says Sandra Boyle, Cushman & Wakefield’s chief operating officer for San Francisco, and also chair of a foundation created by the Building Owners and Managers Association of San Francisco to address workforce problems.

It is a problem facing every type of company in the buildings ecosystem.

“We’re seeing the retirement of Baby Boomers in our industry, coupled with an increased demand for highly talented candidates at all levels, as a result of the current surge in building and infrastructure projects,” says Len Vetrone, Skanska USA Building’s Co-Chief Operating Officer. Vetrone has been in the position since August and was part of a transition plan when Baby Boomer Bob Babitsky announced he intended to retire. “The industry is experiencing significant movement of top level management and, now more than

ever, it’s important to have succession plans in place for key positions and to do everything possible to attract and retain top talent.”

John Benson, vice president of human resources for Skanska, agrees. “The exciting kinds of projects

“We’re seeing the retirement of Baby Boomers in our industry, coupled with an increased demand for highly talented candidates at all levels...” — Len Vetrone, Skanska we have, our modern culture and values and our reputation for safety help us attract a highly skilled set of trade workers who were underemployed during the downturn. Because we’ve seen such growth in the California market, we’ve put significant effort into attracting top talent from other parts of the country from within the company. Skanska is committed to offering opportunities to grow, develop, and lead in an environment that promotes safety, diversity, inclusion and reward for high performance.”

Napa-based Carlos Santamaria, principal of the global real estate consultancy CEES-Advisors, says, “The state of the industry from a service employee or building operator standpoint is that people are leaving without adequate transfer of knowledge to other workers eroding industry knowledge of the current workforce.”

Shortages of Qualified Engineers are Becoming Acute Reductions in the number of highly skilled employees, like buildings engineers, are particularly worrisome, as facilities become increasingly complex to operate. Santamaria says the problem is particularly pronounced among engineers and facilities people. “We are certainly seeing more and more building operating engineers leaving when they meet the minimum age requirement.” He added, “From a service employee perspective, this hasn’t been something that companies are able to get in front of or control. On the management side, educational and monetary incentives are used regularly to retain existing and attract new workers.”

Jones Lang LaSalle engineering executive Adam Kilburn, who is also a leader in the Bay Area’s Association for

11 California Buildings News • January/February 2015

Facilities Engineering, says, “We are seeing a very large gap background has fallen on the industry companies. With in the supply of building maintenance professionals during pressure to perform more for less, the struggle with this wave of retirement. In my opinion three key things creating and sustaining these training programs is evident. have happened. First, the industry was saturated with good The stronger the baseline training is for undergraduates, hardworking men and women the better chance our industry will who retained long-term posihave to sustain our workforce in tions. These people continue the future. Our partnership with to be both the foundation and San Francisco State University leaders in our relative areas of ensures that the university is able expertise. Second, over time the to not only sustain its certificate number of positions available program in commercial real estate in the overall technical maintebut expand it to a ‘specialty’ and nance market has gone down. later a concentration and even Crew sizes have shrunk, owners move this program to other state have shifted to on-call or mobile universities. The student interest maintenance, and the cost to in our program has been very high keep a full engineering crew has as are the internships provided by steadily grown to be a burdenour industry. some number.

“One of the goals of the part“Third, the combination of nership with San Francisco State the first two factors has meant and the BOMA Foundation with no new infusion of talent. There the help of our careers committee is no next generation ready to is to actively campaign for our step in and carry on. Apprentice industry and educate the underand entry-level positions are Buildings associations like BOMA, IFMA, AIA, IREM and SMPS are graduate students as well as the pooling ideas to educate tomorrow’s workforce. hard to come by and owners workforce on careers in commercial frequently would rather pay real estate,” added Boyle for expertise versus paying for someone to learn the trade Not all Baby Boomers have the luxury of retiring— along the way. Retirement ages have been pushed up keepor the inclination — so there may be at least some tempoing these folks around longer. These factors have created rary relief in some sectors of the buildings industry. Jana a huge knowledge gap that many trades are scrambling to Turner, commercial real estate-industry veteran and princiovercome. pal at RETS Associates says, “Baby Boomers are not retiring “I have seen two methods being used to combat the from CRE manager jobs as predicted. The recent recession problem. First, compensation packages are being driven up has caused many in this group to have to work longer than for top-level talent to stick around for a few extra years to anticipated. We are greatly seeing this phenomena in the ‘get things stable’ before they exit. This in truth is no help, property management sector.” and is merely putting off the inevitable. The most effective West Coast-based Glumac, an engineering firm with an plan has been coming from the trades themselves. They enlightened HR policy, has met the talent challenge with a are actively trying to create more entry-level positions to five-point plan, says spokesperson Britt-Marie Phaneuf: prepare for the massive exodus ahead. Savvy engineering “(1) Education: We invest in our people and create learnmanagers are pushing clients to on-board these positions ing and mentoring opportunities for them, including new today so that they will be ready in two-to-three years to employee, PM, and management training; (2) Culture: We carry the load. Training is also being increased and made sponsor and encourage our staff to have healthy lifestyles more easily available to those joining the industry. Overall through company-funded healthcare benefits and a wellthe market is aware of the challenge ahead and is slowly ness incentive program; (3) Compensation: We compensate turning the ship in the right direction,” Kilburn concludes. competitively and provide opportunity to those who express interest in developing themselves further; (4) Technology: Building Management Groups are Responding We leverage social media to convey our culture and to reach to the Problem tech savvy recruits; (5) Workplace: We invest in our office Cushman & Wakefield’s Boyle is one of the founders spaces, creating attractive, sustainable and comfortable places of BOMA San Francisco’s educational effort. She says, “The where staff are productive and want to be.” burden of training entry-level employees with little or no (Continued on page 16)

12 California Buildings News • January/February 2015

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Buildings: A Fam

You Know That Jobs Managing Buildings At a recent Building Owners and Managers Association Oakland/East Bay luncheon a young Cushman & Wakefield tenant services coordinator seemed on very personal terms with an Able Services executive who was old enough to be her father…which it turns out he was. Kaitlin Murphy and Tim Murphy have talked buildings issues together since she was a little girl and visited her dad at her granddad’s janitorial company in Alviso.

A major solution to the looming shortage of buildings industry professionals may be right in our own homes. You need not look farther than someone right across the breakfast table to get a job in the burgeoning commercial real estate management field—or in the design, supply and operations of office buildings, hospitals, hotels, apartment complexes and industrial properties. In fact, there are numerous examples of family members throughout California who have induced sons, daughters, brothers, husbands, wives and others to help design, build and run buildings. There are many rewarding careers in the greater buildings industry, reason enough to induce a family member to find a suitable role.

Like Father, Like Son — and Daughter “I always knew that I wanted to work with people,” says Kaitlin Murphy, who works at Jack London Square in Oakland. “I had seen how my dad interacts with multiple people on a day-to-day basis in a helpful and effective matter. As I was finishing my psychology degree, I decided to get my real estate license. At the time, I did not know whether I would want to get into the facilities side like my dad, or become a Kaitlin Murphy and her father, Tim Murphy. broker of real estate. After about a year as a broker, I realized that the management of facilities was more suited for me.

“It was helpful to have family in the business who could point me in the right direction. I began attending BOMA events and trying to get my name out there. I have been with Cushman & Wakefield now as a tenant services coordinator for about six months and just joined the BOMA Young

“Careers in the service industry can be tough, but it is also so rewarding and for the most part recession proof. Buildings always need to be managed and services always need to be provided.”

— Tim Murphy, Able Services Professionals Committee. I am very happy with the career path that I chose and very lucky to share a passion for the industry with my dad.”

Tim Murphy, who is Able Services’ Bishop Ranch facilities director, says, “When Kaitlin was growing up she would ask me what I did, and I would try to explain to her that I was in the janitorial business, and I worked with property managers and facility managers to provide cleaning services for their buildings. I never thought my kids would be in our industry. Let’s face it, you don’t grow up dreaming to be in the janitorial or property management business. Two of my three kids are in our industry, Kaitlin on the property management side and my son Brian is a stationary engineer for Able Engineering Services. I am so proud of all three of my kids for choosing their own career path. I am not the type of parent that pressures their kids on their career choice.”

And there is a practical reason for young people to seek careers in the buildings industry, says Murphy. “Careers in the service industry can be tough, but it is also so rewarding and for the most part recession proof. Buildings always need to be managed and services always need to be provided. I think that a career in the building services and management industry is a good mix of both tech and getting to work with people. Although we live in a very techy environment, tech careers are not for everyone. In our industry, you get a combination of the technical ins and outs of the building but also get the rewards of being out there with boots on the ground engaging with your counterparts.”

15 California Buildings News • January/February 2015

mily Affair

s Are Good When Parents Tell You So The Richards Property Management Dynasty The name Paul Richards is regal in the downtown San Francisco commercial real estate world. He’s held top industry leadership posts at professional organizations like the Building Owners and Managers Associations and the Institute for Real Estate Management. He is widely respected and has taught numerous managers—including his sons Preston and Perry who followed him into the field.

“I really never expected any of our four sons to follow my lead into commercial real estate development, management and leasing. However, having said that I am very pleased that Preston worked his way into the property and facility management business,” says father Paul.

“When my boys were young and asked about my job I just told them I worked for the CIA…that was the easy answer. As the boys grew up all of them worked summer jobs in one of our properties and learned varied hands-on skills, including paint-on and paint-off in many a building mechanical room. When Preston expressed interest in real estate after graduating from San Jose State, we talked about brokerage, finance, development and the management sides of the business, and I gave him some contacts to call upon.

I also explained exactly what an ‘entry-level’ position meant in our business and that if he played his cards right and became a quick study he would be amazed at how fast he could move up in the business.”

“Preston like me was fortunate enough to have some great mentors. I had Ray Nann and Elmer Johnson. He has had Claudia Benjamin, Tim Ballas, Steve Austin, Steve Colvin and Sandra Boyle, who took an interest in his career and advancement plus. They encouraged him to get involved in BOMA, which he did and earned his RPA and FMA designations. I am also proud that Preston has followed my lead and has participated as an instructor for the BOMA Foundations program since I am a big proponent of giving back to our business and professional associations. Also, our youngest son Perry is in the business, presently an apprentice engineer, working for Able Engineering at Lake Merritt Plaza, Oakland.”

So what drew Preston Richards to follow his dad and ascend to his current post as workplace site manager at LinkedIn? “As a kid I always enjoyed visiting my father’s office in San Francisco and getting to meet his colleagues, many of which were close family friends. Working at 71 Stevenson as a 15-year-old student was my first experience dealing

with building operations, and I really enjoyed learning about all aspects of the building. After graduating college I was fortunate enough to find a career that I enjoyed, seemed to have a knack for, and offered a relatively clear path toward upward movement.

“I enjoy the wide range of projects real estate management has to offer and appreciate teaming up with industry professionals who assist in overseeing projects from cradle

Preston Richards (left) followed his industry-leader dad, Paul Richards, into a property management career.

to grave. Real estate management educational offering have provided me with a good platform for formal training, but there’s nothing like the experience gained from hands-on day-to-day operations and projects along with the positive (and sometimes negative) relationships that are formed through them.

“My involvement in BOMA since the beginning of my career has been instrumental in my educational growth and building my professional network. I simply wouldn’t have known nearly as many peers as I do now if it weren’t for my involvement in the BOMA Young Professionals Committee and undoubtedly wouldn’t have had the depth of knowledge I now possess if it weren’t for the Codes and Regulations Committee and Danny Murtagh. I’ve been fortunate enough to work for first-in-class companies and have exceptional mentors.” n

16 California Buildings News • January/February 2015

Talent Shortages (Continued from page 11) U.S. Construction Boom Adds to California’s Shortages Pressures to find qualified workers are a national problem, pitting one region against another for human resources. A San Francisco-based general contractor told California Buildings News recently that his firm has been scouring the land for skilled workers from as far away as Florida.

Eighty percent of construction firms plan to expand their payrolls in 2015 while only 7 percent expect to reduce headcounts, according to survey results recently released by the Associated General Contractors of America.

The survey, conducted as part of Ready to Hire Again: The 2015 Construction Industry Hiring and Business Outlook, indicates that most contractors are optimistic about the year ahead and ready to expand, but will have to cope with challenges including worker shortages and regulatory burdens.

“Contractors are extremely optimistic about the outlook for 2015,” said Stephen E. Sandherr, the association’s chief executive officer. “Indeed, if their predictions prove true, industry employment could expand this year by the most in a decade.”

Sandherr noted that the number of firms planning to add employees— 80 percent— in 2015, is significantly higher than in 2014, when only 57 percent of firms report they added to their total headcount. However, many firms that plan to hire this year expect to make only modest increases, with 90 percent of the firms that expect to add employees reporting they will expand by one-quarter or less this year.

“As firms expand their payrolls, they will invest in new equipment, pursue new market opportunities and embrace new and more efficient ways of doing business. Yet the industry must still cope with the challenge of growing worker shortages, worrisome regulatory proposals and declining federal investments in construction and infrastructure,” according to the AGC report. n C

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18 California Buildings News • January/February 2015

Association News

IES Lighting Conference Illuminates Emerging Technologies An expert in lighting design told the Emerging Technologies conference held by the Illuminating Engineering Society in San Francisco recently that studies have shown that people can perform at higher rates in blue-white lighting environments.

Arup’s Senior Lighting Consultant Toby Lewis said her company found that the bluewhite light spectrum is linked to better health and well-being and that it enhanced performance in a test the London-headquartered engineering firm conducted. She said the goals of lighting design in buildings should be to create a more beautiful environment, save energy and better address the functional needs of users.

To that she added that lighting design should also promote human health.

Jay Shuler, CEO of Cool Lumens, sees lighting interacting with many other buildings’ functions to create new opportunities. “Lighting is the perfect host for communication nodes in the commercial and municipal Internet of Things (IoT). They are ubiquitous, evenly spaced, and elevated— perfectly positioned for wireless mesh networking, and where they can see the entire public space.

They are powered, eliminating “Lighting is the perfect host for communication nodes in the commercial and the need for batteries. And they municipal Internet of Things (IoT),” says Jay Schuler, CEO of Cool Lumens. are IoT nodes themselves, being one of many devices that will be controlled for energy savings, management, human comfort and convenience. The transition to LED lighting provides us a golden opportunity not only to save lighting energy, but to begin the build-out of the IoT infrastructure.”

19 California Buildings News • January/February 2015

LA Architects’ Advocacy Efforts Produce Results By Will Wright For over ten years, the Los Angeles Chapter of the American Institute of Architects (AIA|LA) has been sharing constructive recommendations to improve the environmental and economic performance of the region with ideas to advance the health, livability and functionality of the area.

We are delighted to celebrate the fact that many of our ideas have been implemented and that many more of our recommendations are evolving into an actionable agenda supported by constituents and politicians alike. In an effort to further shape our efforts moving forward, 2015 serves as an excellent opportunity to reflect upon these past 10 years and celebrate our successes and, at the same time, highlight our regional issues that still need to be improved upon.

Analyzing the cumulative effects of our 10 years of Advocacy Briefs, the AIA|LA applauds civic leadership for engaging architects and designers more inherently in the process to build world-class civic projects and public architecture. We’ve achieved substantial progress adopting energy, land-use and transit policies that will create a healthier and more sustainable region. We’ve also led the way with advancing watershed management and conservation policies such as low-impact development, gray water/water-recycling measures, distributed power and renewable energy advancements. As community leaders, we’ve also successfully enabled more architects and designers to serve on neighborhood councils, design review boards and city commissions.

One of our most notable achievements has been encouraging Los Angeles City Council to invest in a new citywide zoning code and streamline entitlement and permitting procedures, which will provide more clarity to the community. We were also proud to see LA Department of Building and Safety wholeheartedly adopt our recommendations for how to improve their L.A.R.R. process for permitting non-structural building materials.

Still Have a Long Way to Go Areas that we’re happy to see substantial progress, yet still need some additional improvements include procurement reform and expanded project delivery opportunities that will help more resources be directed into public facilities, achieving best-value for the owner and constituent.

We inched a step closer to business tax reform, but still have a long way to go to correct the unfair burden of our industry’s double-taxation on pass-throughs to

sub-consultants and the consequent disadvantage to LA firms that export design solutions internationally.

We also recognize that substantial work needs to be applied towards greening our infrastructure, making our streets safer, healthier and more beautiful and cleaning our watershed.

However, regrettably, some of our ideas have received very little traction. Multi-jurisdictional joint-use development between our many layers of government deserves more attention. So does achieving meaningful and substantial CEQA reform for sustainable urban infill development and infrastructure. Regulations that facilitate joint-ventures and public-private partnership (P3) financing also need strategic advancement in an effort to tap into more effective funding and project delivery opportunities.

Also, and perhaps most urgently, genuine and holistic regulatory reforms need to be implemented in effort to facilitate greater housing affordability and a better balance in the jobs/ housing ratio region-wide.

While some may feel that these obstacles are insurmountable, the AIA|LA is confident that with the right leadership, and with a reinvigorated civic negotiation of our public realm, we as a region can make substantial progress. If you synthesize all of these corresponding objectives, it all comes down to advocating for more city leadership to apply a design-thinking approach to improving the health, beauty and economic prosperity of our region.

Rather than tackle all of our disparate problems in silos, AIA|LA encourages our civic leaders to bring architects and designers to the table early and often and to envision the solutions that can achieve a multitude of goals and leverage the various pools of resources in a more holistic and integrative fashion. For instance, based on a recent needs assessment, LADWP recognizes that it will need to repair and replace its vast network of utility poles and water mains. Likewise, as a region we must find a way to clean our watershed and ensure a safe, resilient supply by strategically recharging our aquifers Rather than tackle these issues as a set of disparate and competing problems, AIA|LA recommends that we optimize this as an opportunity to replace our water mains, bury our power lines and repair and upgrade our sidewalks and roadways all as one comprehensive effort to improve the environmental performance and the health of our public realm, which in turn will make the city more attractive and economically prosperous.

It is with an enduring sense of loyalty to Southern California that AIA Los Angeles offers our design and leadership resources and our commitment to work with policy makers and civic leaders to advance a healthier and more prosperous region for all.

Wright is Director, Government & Public Affairs, AIA Los Angeles.

20 California Buildings News • January/February 2015

Do You Have—or Need—Terrorism Insurance?

By Kathy Mattes The events of September 11, The next question would be which specific properties or 2001 in New York cost insurance places should have terrorism insurance? The highest priority companies close to $40 billion. places would be properties or locations that are large, signifThe subsequent Terrorism Risk icant, loved or otherwise important. The second tier of risk Insurance Act of 2002 established would be the properties in close proximity to the first. As a government-funded reinsurance program that enabled you move further away from the place of a possible terrorist insurance companies to continue to provide coverage for event, the likelihood of a terrorism insurance loss is reduced. terrorist events in the then more-uncertain world.

So who is carrying terrorism insurance for their properWhen 2014 came to a close, so did the Terrorism Risk ties? Prior to 9/11, standard commercial insurance policies Insurance Program Reauthorization Act (TRIPRA) of 2007. included terrorism coverage as part of the package, effectiveIn early January Congress passed, and President Obama ly free of charge. Today, insurance losses attributable to tersigned into law, the Terrorism Risk Insurance Program rorist acts under commercial policies are insured by private Reauthorization Act of 2015, reinstating “...the San Francisco Bay insurers and reinsured or “backstopped” by TRIA for six more years. (The original TRIA the federal government pursuant to TRIPRA, Area and the Los Angeles/ and owners of commercial property must be of 2002 was extended by an extension act (TRIAEA) in 2005 and a Reauthorization Act Orange/San Diego corridor offered the opportunity to purchase terror(TRIPRA) in 2007, which expired 12/31/14.) are all possible targets for ism coverage. All Workers Compensation Reading about this in the BOMA policies must include terrorism risks. a terrorist attack.”

California Weekly Update got me asking It is safe to say that all iconic, wellmyself a few basic questions: How is terrorknown office and major retail properties ism defined? What does terrorism insurance cover? What within California carry terrorism insurance. I spoke with does TRIA mean to terrorism insurance? And what does this Scott Ritto, Senior Risk Manager for Kilroy Realty Corp., mean for properties in California? which has a multi-million-square-foot portfolio of properThere is no international definition for terrorism. The ties in California and on the West Coast. Kilroy has a blanword is commonly used to refer to violent acts intended to ket policy on its entire portfolio with terrorism insurance create fear, perpetrated for a religious, political or ideologembedded in it. This means that their insurance coverage ical goal, and with a deliberate target and disregard for the comes from an “admitted” company, rather than a “surplus” safety of non-combatants. A study found 22 separate definior “excess lines” insurer. Kilroy could choose to opt out of tional elements, including violence, force, fear, threat, and the terrorism coverage, but the cost is such that they have victim-target differentiation. not elected to do that. I also spoke with Hudson Pacific, TRIPRA 2015 provides us with a way to define terrorism which has a 6.4 million square-foot portfolio in the same for the purposes of insurance in the U.S. TRIPRA covers markets, and the answer was the same. only those events declared as terrorism by the Secretary of Jerry Becerra, with Barbary Insurance Brokerage, handles the Treasury, in concurrence with the Secretary of State, the insurance for a number of buildings and businesses in San Attorney General and the Secretary of Homeland Security Francisco. He informed me that all insurers must provide a as an act that is dangerous to human life, property or infradisclosure notice of terrorism insurance coverage. Whether structure and to have resulted in damage within the United the coverage is embedded or not, clients may either opt out States or on U.S. property or premises outside of the U.S. of the coverage or fail to opt in. Clients tend to make that According to the State of California’s Office of Emergency decision based on a number of factors, including type and Services website, “California’s population, industrial infralocation of the property as well as the cost. structure, economic importance, international reputation, The manager or operator of a commercial property is media industry and numerous iconic features combine to seldom involved with the placement of insurance coverage, make the state a potential target for both domestic and and is often not even aware of whether terrorism coverage international terrorist acts.” I think it is safe to say the San is in place. Perhaps that would be a good topic to include in Francisco Bay Area and the Los Angeles/Orange/San Diego your next meeting with building ownership. corridor are all possible targets for a terrorist attack.

Mattes is a Real Estate Consultant in San Francisco — www.kathymattes.com.

21 California Buildings News • January/February 2015

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22 California Buildings News • January/February 2015

Association News

Building Environments Can Sicken People, USGBC Audience Told People who work or live in buildings that are noisy, poorly lit, over-crowded, humid and too hot or too cold can develop stress and other diseases, Esther Sternberg told attendees of the Building Health Forum held at the University of California San Francisco at Mission Bay by the U.S. Green Building Council of Northern California. Sternberg is director of research at the University of Arizona Center for Integrative Medicine. She said building designers and operators are, however, able to create interiors that are calming and capable of producing higher levels of comfort and work productivity.

“People take their buildings home with them at night,” she said, carrying the stress that building environments cause into their personal lives.

The USGBC conference covered a wide range of topics intended to stimulate solutions to poor buildings environments.

Orange County-based Simon Turner, CEO of Healthy Buildings, said, “There is a clear relationship between the productivity of people and healthy buildings environments.” Better ventilation, he said, can produce very positive outcomes. He said his company’s investigators find mold in one out of four air ducts they examine. Legionnaires disease, Turner reported, is actually killing more people today than ever before, and he faulted poor plumbing systems, water tanks and shower heads as the primary causes.

George Denise, director of sustainability at Oracle’s Redwood City headquarters, noted that only 1% of all buildings are new and said there should be much more focus on making existing facilities — many of them over 50 years old—healthier. He said flatly, “Most buildings aren’t managed very well— especially schools.”

Harry Hobbes, the area director of engineering at Intercontinental Hotels in San Francisco, said his sustainability efforts at his hotels are responsible for 7% of the hotels’ profitability. But he added that companies should go beyond greening their properties to make them also healthier, to improve the overall occupants comfort and health.

Healthy Buildings’ Turner identified many areas in buildings where diseases lurk: F Coils and drain pans can breed microbial matter F All wet surfaces must be drained to prevent microbial incubation F Poor air filter maintenance can compromise indoor air quality F Uncontrolled moisture in ducts can produce mold F Exhaust systems should maintain room integrity F VAV box malfunctions can allow temperature and

contaminant levels to increase F Poorly maintained cooling towers can breed deadly

Legionnaire’s disease

23 California Buildings News • January/February 2015

BOMA SF Hears the California Boom Will Keep Echoing

C

alifornia as a whole and the Bay Area in particular will Meantime, reports are surfacing throughout California of continue its “Never Never Land” economic growth rate markedly improved local economies in major coastal areas like for the foreseeable future, a leading economist told Los Angeles, Orange County and San Diego. A recent panel of a luncheon conference of the Building Owners and forecasters who spoke at the San Diego Business Journal’s 2015 Managers Association of San Francisco in late January.

Economic Trends Event, for instance, was unanimous in opti“Everybody here is smiling from ear to ear,” Capital mism about their region’s prospects, with unemployment dropPlanning Advisors Chief Investment Officer Brian Pretti told the ping to a recent 5.8 percent jobless rate in San Diego. audience of commercial real estate executives and representaLos Angeles Economic Development Corporation’s forecast tives of companies that serve the buildings industry. “I grew up for 2015 is also mostly bullish, saying “Sustained employment here, and I have never seen so many (construction) cranes in gains (are) more broad based than the region has experienced the sky,” visible evidence of the buildings boom. “The Bay Area since the end of the recession.” LAEDC says the leading indusis another planet. We are so lucky to live here.” tries will be construction, health care, professional, scientific One of the biggest macroeconomic drivers of California’s and technical services, administrative and support services. good fortune, Pretti said, is the gush of capital flowing from China, Japan and Europe to the safe haven of the U.S. dollar and California real estate. The Golden State is also, he said, “the tech center of the universe” and that has a powerful “economic multiplier effect” on every aspect of the Bay Area’s economy, in particular. “The Bay Area is now a destination for global capital.”

California’s agribusiness, travel and tourism BOMA San Francisco thanks these companies who hired industries are also booming.

San Francisco State University students as interns in 2014, Marc Intermaggio, BOMA SF’s executive many of whom now work in commercial real estate. vice president, commented, “Certainly we’re seeing lots of new money (Chinese and otherwise) seeking real estate in the U.S., San Cassidy Turley/DTZ Francisco, New York, etc. Coastal cities in CBRE particular. Not just office, but lots of residential too. With global turmoil (in the equities City & County of San Francisco market and with sovereign debt crises), U.S. Cushman & Wakefield real estate is a favorable asset class.”

Gachina Landscape Management There are storm clouds on the horizon, however, said Pretti. U.S. economic growth Harsch Investment Properties has been boosted to a great extent by Kilroy Realty Obamacare health expenditures, but most Langley Investment Properties of the government costs of the new medical welfare program were paid for with money Newmark Grubb Knight Frank borrowed by the federal government— The Presidio Trust adding to an accumulated debt taxpayers will face downstream. U.S. debt and that incurred by other major national banks has With support from the BOMA San Francisco Foundation, SFSU’s Commercial now topped $45 trillion, said Pretti, creating Real Estate Certificate program is strengthening and expanding our workforce. the possibility of a downstream bubble.

To participate in the 2015 internship program, email jobready@boma.com.

The U.S. economy will continue to benefit in the foreseeable future from the attraction of the strong dollar and in the protection of American real estate. “America is the only repository big enough to accept (the flow) of foreign capital,” said Pretti.

“It has nowhere else to go.” He added, “Foreigners are buying (American) real estate like there is no tomorrow.”

BOMA and SFSU...

Helping Students Launch Their Commercial Real Estate Careers

24 California Buildings News • January/February 2015

Association News

Silicon Valley Apartment Industry Strives to Provide More Homes California Apartment Association Audience Got Good News–Bad News Reports The Silicon Valley apartment market this year is projected to be robust, according to various speakers who addressed the California Apartments Association’s Outlook 2015 conference in Mountain View, sponsored by the TriCounty CAA (covering Santa Clara, San Mateo and Santa Cruz Counties). That said, they noted there are still impediments to providing enough rental homes for the surging technology- driven workforce.

San Jose Mayor Sam Liccardo told the audience of apartment owners, managers and suppliers that his administration is committed to working with developers to increase the rental housing supply—especially if it can be located near mass transit.

“This year we will continue to build aggressively in downtown San Jose,” he said.

He added that the Millennial generation’s fascination with San Francisco cannot last forever, since average rents there are nearing $4,000 per month. He pledged to work to create a more “vibrant urban space” of entertaining, park-like venues that younger workers enjoy in San Francisco. The mayor said that in the next year, “San Jose will add more homes than the other three (Bay Area) cities combined,” referring to San Francisco, Oakland and Fremont.

The speakers at the conference painted a picture of Bay Area rentals that are strongly influenced by regional dynamics, with San Francisco and San Jose being bedroom communities for more job-intensive regions where companies like Google, Facebook, Apple and the many global headquarters of the traditional Silicon Valley are located.

$4,000-a-Month Rent and Four-Hour-a-Day Commutes As San Francisco rents approach $4,000 a month and commutes to Silicon Valley can easily top two hours each way, more renters are moving to the East Bay and beyond—and yet there seems no stemming the tide of newcomers to Northern California.

Bay Area unemployment is around 5%. Economist Lawrence Souza reported that more than 100,000 people moved to the Bay Area last year: 40,000 to Silicon Valley, 40,000 to San Francisco and almost 25,000 to the East Bay. “There is nothing like being close to jobs,” said Essex Property Trust Executive Vice President John Eudy. Agreeing, Prodesse Property Group President Michael Pierce, said that Millennials want to live as close to work as possible, often forgoing cars and relying on mass transit or walking to work and area attractions.

Both industry leaders said trends are strong for continued apartment living for other reasons as well. “High housing costs are trapping people in multifamily housing,” said Pierce. This

includes families who might have bought homes in times past, but are now settling into apartments for longer periods of time in areas close to good schools. Increasingly, apartment developers are working with sustainability advocates to build apartments that are both taller, denser and adjacent to mass transit.

Government Issues Impacting Multifamily Housing On the positive side, political leaders like San Jose Mayor Liccardo are pushing to permit many more sustainable housing solutions. On the negative side, too many local political leaders are listening to Not-In-My-Backyard (NIMBY) opponents to virtually any type of development. And in Sacramento overzealous progressive Democrats are attempting to impose burdens on the industry that could inflate operational costs, increase tenants’ rent and reduce housing availability.

CAA CEO Thomas Bannon and Senior Vice President Debra Carlton said the apartment industry was successful in 2014 in thwarting a number of attempts to overregulate multifamily properties (such as the Ellis Act amendments that threaten private property control)— but said they anticipate trouble ahead in 2015.

“We were incredibly successful (in 2014) in the vast majority of races in electing pragmatic Democrats (over progressives),” said Carlton. “The California Legislature is under Democratic control, but that includes a lot of moderate and pragmatic Democrats and Republicans, who are mostly with us. The bad news is that our success at the state level pushes (troublesome) issues to the local level.”

In 2014, CAA and its allies were able to win support for AB 2451 governing the use of water submeters, remove a glitch in obtaining electronic signatures on leases with enactment of AB 2747, and with passage of AB 2256 clarified authority needed by law enforcement officers to gain access to gated communities.

CAA Tri-County was also active in government affairs, thanks to the efforts of SVP Joshua Howard and Government Affairs Director Rhovy Lyn Antonio: • Made certain rental property owners are not liable for smoking violations in cities prohibiting smoking • Worked with several cities to develop their Housing Element, ensuring policies were in place to allow creation of affordable housing opportunities • Engaged in elections to promote a strong rental housing industry • Assisted in the reduction of sewer fees in San Carlos

For more information, visit www.caanet.org

25 California Buildings News • January/February 2015

More Women Enter CRE Workforce— But Pay and Promotions Lag

CREW-Los Angeles leaders from top: Crystal Fiedler, Shireen Enayati, and Tori Robinson.

Thanks to organizations like CREW, women are being encouraged to take part in the many roles that are needed to manage, operate and design buildings and provide needed products and services to them.

CREW-Los Angeles President Crystal Fiedler — who is also an Allsteel architect and design manager — recently said, “We are seeing an increase in women in real estate, and as the numbers continue to rise, many benchmark studies still note a gender disparity when it comes to compensation. To better address these disparities, we encourage companies to have their employees (men and women) join organizations like CREW, to gain access to tools and networking that will help women thrive in real estate and gain leadership training. It is important for companies to have formal and informal mentorship programs that pair senior leaders with women in their company, giving them the visibility, connections and assistance they need to excel.”

She added, “We also encourage ‘Lean In’ type programs, that allow women in an organization a forum to discuss issues related to women in the profession, increase their network of people, and have someone they can reach out to for assistance, guidance and sponsorship.”

Founded in 1989, CREW Network is the industry’s premier business networking organization dedicated to supporting the achievements of women in commercial real estate. Members represent nearly every discipline within the industry and the organization encourages/welcomes men to join. The network is comprised of 74 chapters and approximately 8,700 members across North America. Its mission is to influence the success of the commercial real estate industry by advancing the achievements of women.

BOMA San Diego Earns International Recognition for Linkage Fee Referendum Campaign The Building Owners and Managers Association (BOMA) of San Diego was recently honored by BOMA International for “Outstanding Single Government Affairs Issue.” The award recognized BOMA San Diego’s leadership role in a referendum campaign to overturn a commercial construction fee increase approved by the San Diego City Council. That fee increase, designed to assist in financing subsidized housing units, was 350 percent–750 percent depending on commercial development type, and was estimated to cost the industry $8 million–$10 million annually in increased fees.

Following the City Council vote in December 2013, BOMA led a partnership of more than 50 San Diego businesses and organizations, known as the San Diego JOBS Coalition, to launch a referendum campaign.

In January 2014, the JOBS Coalition turned in more than 53,000 referendum petition signatures, and in March 2014, the San Diego City Council voted unanimously to rescind the fee increase. BOMA then negotiated a compromise agreement with the City of San Diego which incrementally and nominally increased the fee in exchange for exemptions and regulatory reform. BOMA San Diego’s effort saved its membership millions of dollars, demonstrated the importance of coalition building, and provided a road map to success for other industry associations across the country facing similar challenges.

26 California Buildings News • January/February 2015

Buildings of the Future (Continued from page 7)

Interiors and Exteriors Will Be Integrated Larry Morgan, SAP Senior Facilities Manager and IFMA Board Member, Pleasanton Much has been written and discussed on what the future of the built environment will be from an architectural perspective, technology perspective, flexibility perspective, etc., but I have rarely seen a discussion on what the built environment of the future may be like from a tactical operations perspective, so let me share my views. z All buildings in the future will still have a top, sides and a bottom that require proactive care. Shelter and security is the primary reason buildings are built, and that won’t change. The difference will be that the exteriors of the buildings will be integrated into the infrastructure to generate power and help eliminate air pollution, etc. z Core operations and maintenance functions will largely remain the same but based on type of activity per location with performance contracting the norm not the exception. Robots won’t be cleaning the toilets, etc. anytime soon. z Technology/IT driven FM decision is the future they say, not without the coinciding investment in human capital. I can train a monkey to change a light bulb, but I can’t train a monkey to use data-based group relamping decisions, educate to extrapolate. z The gap between the outgoing and incoming professionals that operate these capital investments will reach critical mass no later than 2020. Attract, pay accordingly, retain and educate — or move your own desk.

State Government To Continue Driving Greener Buildings Esteban Almanza, Acting Director, California Dept. of General Services, Sacramento California has long been recognized as a worldwide leader in environmental protection, energy efficiency and the fight against climate change. This commitment to sustainability also applies to California’s state government operations. At the direction of Governor Edmund G. Brown Jr., the California Department of General Services has been charged with leading the state’s green building efforts.

To date, approximately 140 state-owned and leased buildings have achieved LEED (Leadership in Energy and Environmental Design) certification from the U.S. Green Building Council. That number will continue to multiply over the next decade.

Many state agencies are also installing solar power at their facilities via an innovative power purchase agreement program managed by DGS. Under the agreements, the solar provider installs solar power systems using third-party financing and then sells the renewable electricity generated by the solar panels at a competitive cost to the host facility. Wind power is also becoming an option.

In addition, Governor Brown has directed that all new state buildings and major building renovations beginning design after 2025 be constructed as zero net energy facilities: buildings designed to produce as much energy as they consume in a year.

DGS is leading the effort to meet that goal.

27 California Buildings News • January/February 2015

Hotel Design: Back to the Future Bob Eaton, Founder, Eaton Hotel Investments, Arroyo Grande New trends in hotel design are returning to the origin of hotels as far back as the 19th century. Back then a community’s major social events were held at downtown hotels, where people came together for important civic affairs, weddings, receptions, meetings, etc. These urban hotels featured the best cuisine and palatial lobbies. Examples are the Beverly Hills Hotel, the Palace in San Francisco, the Biltmore in Los Angeles, etc.

New hotel design is reflecting the changing nature of hotel guests.

Dominated by the Millennials and their active social activities, new hotel designs are going back to the origins of hotels as social meccas. New design ideas today are minimizing guest room space and amplifying the scope of public spaces for “hanging out” or dining and drinking. There is a new appeal for open public venues to gather for social interaction that may be missing in other parts of our digital age. Hotels are able to be minimalists in actual rooms and accommodations, yet expansive and open in these new public spaces. Tomorrow’s hotels are focusing on the delivery of a public identity and status as a place to be with others —and not just a place to sleep while away from home.

More Training Needed for New Technology Robert Alvarado, Executive Secretary-Treasurer for the Northern California Carpenters Regional Council, Oakland The impact of technology and design promise to revolutionize the building industry in both design and function. With this in mind, it’s important to realize that the training for those trades people, who would build these future buildings, is important to ensure form and function.

It’s very easy to leap to the conclusion that new training programs must be developed and then must be taught by someone. Most often, it’s a last minute race by educational groups to develop these training programs; usually at great cost and without much success.

While design and function may change, at its core, construction processes and the application of these processes remain pretty constant. The modern apprenticeship program, as offered through the building trades and the Carpenters Union, has always been able to address the rapidly changing technology in the construction industry. Labor/Management make up the governing body of the apprenticeship, allowing for discussion of new trends and the implementation of new processes within the construction industry.

In addition, the apprenticeship is also a place of higher learning, where journey level crafts people have the opportunity to learn and certify in new skills and technologies, giving employers and end users the best product available.

(Continued on page 28)

28 California Buildings News • January/February 2015

Buildings of the Future (Continued from page 27)

Building Regeneration, Beyond LEED and Wellness Alan Pullman, Senior Principal, P+R Architects, Long Beach The architecture community has a responsibility to design places that have less impact on our Earth and greater impact for our personal wellness. The industry will trend in three areas —regeneration and appropriate buildings, moving beyond LEED and net zero and wellness. There has already been a shift to a more conscientious approach to design: micro homes, adaptive reuse, culturally appropriate buildings which sustain generations. This mode of thinking will continue to flourish.

Sustainable design is ubiquitous in architecture, in the future a shift will occur to provide a regenerative effect on life with ideas like net positive buildings.

Lastly, wellness will be a major emphasis on all built projects — it will be holistically integrated into the design and truly enhance the health of occupants and users.

Providing and planning for tangible results across the design spectrum— from circadian lighting to fitness integration— will encourage a cultural shift towards greater wellness. The Well Building Standard will become as universal as LEED certification.

Data-Driven Systems Will Improve Functionality Jessica Handy, Director, CodeGreen Solutions, Santa Monica In the future, we will all have a deeper understanding of our built environment through the integrated use of data. We will get real-time outputs from buildings such as occupancy loads and water waste detection, and building operators will get real-time inputs from users about working schedules, climate comfort, and lighting level requirements.

The path to fully leveraging building data starts with seamlessly collecting, analyzing, and taking action based on real-time data. The key component of this data revolution begins with understanding utility consumption, much as it does today. Utility providers are working towards providing real-time data electronically through the use of smart-meters, but are often not keeping pace with the increasing demand for real-time data.

Analyzing collected data is already a reality through a variety of skilled consultants and analysis tools. Data allows us to make decisions based upon facts, not assumptions. Facts including what systems are being used when and by which occupants in what location, can be used to optimize HVAC delivery, to adjust blinds, and to temper water, lighting and air levels. These tools are available now to a rapidly growing group of early adopters. But if we desire a better future, real-time data and analysis tools must be accessible to all.

29 California Buildings News • January/February 2015

Tenants Will Drive Building Modernization • Meade Boutwell, Senior Vice President, CBRE, San Francisco San Francisco continues to be a leader in the revolution of office buildings.

New attributes in these “buildings of the future” will be more technology and data-driven than physical or plant-driven, as building owners today have, for the most part, run their buildings as efficiently as possible.

Tenants or occupiers will be expected to take authority over their own sustainability, observing the impact of their occupancy and use of office space within building systems. We envision tenant spaces being metered separately, so occupiers can track their energy consumption, water use and waste output in real time. These expenses will be net of the base rent and controllable by the tenant, encouraging conservation and comparison among peers.

Building owners will continue to enhance the quality of the work environment by providing new building-managed areas for collaboration and upgraded amenity packages. Roof decks and outdoor spaces are gaining popularity, with more developed in the last two years than in the last two decades. As workdays become longer, employees desire integration of workouts, bike rides and recreation throughout the day, thus showers and bike parking are evolving from conveniences to must-haves.

From sustainability to amenities, occupiers are driving new building trends and transformation. “Buildings of the future” will not only provide access to amenities to help employers recruit and retain top talent, but they will also help foster social interactions and perhaps even build a sense of community.

New Materials Offer Architects More Aesthetic Choices Scott Uriu, Principal, Baumgartner+Uriu, Los Angeles Our hopes for buildings of the future, especially within the upcoming decade, would be to have buildings that take full advantage of many of the exciting modern materials available, new composites, along with many of the new technological advances; CNC milling, laser cutting, water jet cutting, and 3D modeling advances. With much of this new technology it is becoming to the point where mass customization is less and less of an issue; one example is CNC cut material; it does not automatically mean there is a multitude of saving to repeat a pattern over and over, but it is the overall cutting time that is more important, allowing components and pattern to be potentially uniquely cut each time. Also it would be my wish that buildings use these materials, technologies, and techniques not merely as feats of engineering but as aesthetic choices, placing more emphasis back onto the human spirit, and less weight on pure cost-benefit-analysis and efficiency. With all of the immense technology and information available, along with a resurgence of remarkable fabricators, it is hard not to have a positive vision of the next generation of buildings have in store for us.

We are working on a couple of projects where structure and cladding are collapsed more into a single entity, using composites in that true sense of the word, and thus designing more efficient buildings, these we are hoping to see finished well within the next decade. n

30 California Buildings News • January/February 2015

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Industry Profile

Plenty of Space Left for Bay Area Tenant Growth

Q&A with Steven M. Ring, Managing Director Northern California Investor Services, Cushman & Wakefield You have asset management responsibilities for the entire booming Bay Area region. Are you worried that the area is not going to be able to accommodate such explosive growth with sufficient space?

We still have many developable and re-developable commercial sites in the greater Bay Area, so I’m not concerned about space.

What concerns me is being able to get employees to these spaces. I have seen two big booms in the last 20 years in the Bay Area, and this feels the same but isn’t the same. The difference is the transportation hub development that is occurring in the residential area of our industry. This is going to be the only way the Bay Area will be able to accommodate this explosive growth. Employees have a tipping point and two-hour morning commutes from beyond the Altamont Pass is not the answer. If our transportation authorities can keep up with the Bay Area needs, I think we can move employees more efficiently than we do now. Unlike other areas of the nation, we are lucky to have multiple modes of mass transportation and our underutilized ferry system.

Surely San Francisco is beginning to reach commercial real estate capacity. What other parts of the Bay Area are you recommending to prospective tenants?

Tenants will go where they have to go. If a social media firm needs to be in San Francisco because their investors insist, then they will have to adjust their budgets accordingly. It is the other set of tenants that don’t need to be in San Francisco. As the leases from 2009 and 2010 are starting to roll, I’m seeing the “back office” needs searching other areas of the Bay Area and, in one case, Sacramento that still has high vacancy in certain areas and great rental rates. Again, the transportation hubs will continue to be important to tenants and being able to attract talent. Oakland is ripe, once again, to prosper. I hope the new mayoral administration understands what they need to do.

What other regions of the state are appealing to companies and organizations that may not be able to house all their employees in the Bay Area?

It depends on the business. Tech will always want to be around tech. It is a collaborative industry. Sacramento is on the radar, once again, for companies and organizations that don’t have to be in Bay Area. Los Angeles and San Diego are making appeals to these same firms but they can’t offer a better transportation experience than the Bay Area and, in fact, have less options. Cost of housing and warm weather are their appeal.

What impediments are there to providing enough product to ensure some continued economic growth in Northern California?

The major impediment is government agencies. Entitlement processing and fees are astronomical in many regions of the Bay Area and doesn’t incentivize developers. Developers have learned to work it within their budgets but when it can cost $100,000 in entitlement fees per residential unit, you can understand why middle-income housing has become a challenge to build. The supply cannot keep up with the demand.