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BOMA —Your Top Resource for Keeping Your Building Prepared and Up to Code BOMA San Francisco is the go-to organization for providing your team with the most up-to-date information on important topics like emergency preparedness and building codes. Two annual seminars presented valuable information to our members.

Fall 2014

Active Shooter Emergency Preparedness Drill It’s a Wednesday morning, and an active shooter forces his way into your building and threatens your tenants. This frightening scenario could happen in your building. Is your team prepared with a plan to minimize the danger and communicate with first responders, tenants and the media? Life-saving lessons were learned during BOMA’s annual emergency preparedness drill, conducted by its Emergency Preparedness Committee. The drill simulated an active shooter situation at Kilroy Ryan Rusler, Har-Bro; Joanne Hayes-White, SF Fire Chief; Sarah Realty’s 101 MacIntyre, Kilroy Realty; Greg Suhr, SF Police Chief; and Stacia Keisner, CBRE at BOMA’s Emergency Preparedness seminar.

(Continued on page 12)

Building Codes: Changes Impact BOMA Members From CALGreen updates to disability access requirements to San Francisco’s over-the-counter permit process, major changes are affecting building design, construction and operations— and there are even more code changes in the works. BOMA San Francisco’s Annual Codes Seminar speakers enlightened the audience about key updates and how BOMA is helping to shape regulations. “All of these things trickle down to costs for building managers,” said BOMA Vice President, Public Policy Ken Cleaveland. He warned that BOMA will be keeping a close watch on these issues. Moderator Gordon L’Estrange, senior associate at LIONAKIS, led the seminar, starting with a presentation by Skip Soskin, principal at Huntsman Architectural Group. Soskin shared advice on efficiently working with the San Francisco Department of Building Inspection’s (SFDBI) over-the-counter (OTC) plan review process. (Continued on page 8)

What’s Inside Views... n n n n

Meet BOMA Members • Pages 6 & 7 New Board at the Helm • Page 11 What Elections Mean for CRE • Page 11 Volunteer Appreciation • Page 14 Mixing & Mingling... Page 15


2 Managing the Unpredictable With Blake Peterson, BOMA San Francisco President I sat in on a panel interview recently and the candidate was asked “can you tell me about a specific challenge you have faced and how you overcame it?” Cue the awkward silence, followed by a stuttering, predictable sports story. Bo-ring. The reason we ask questions like this is because we recognize that the unanticipated challenges and changes that we face really do shape us as professionals. I’d venture to say that the creative thinking opportunities to solve real problems are the specific experiences that fuel one’s passion for property management. That’s the beauty of the unpredictability factor that we face every day as owners, managers and servicers of real estate. That’s why everyone loves construction. All the variables. When someone asks you about your development project, they don’t want to hear about how it came in on time and on budget, they want to hear about how you dealt with the unanticipated challenges. Trade issues? Lead time? Disruption to neighboring tenants? Scope creep? Behind every successful construction project is a very talented professional that I know worked very hard to keep the proverbial train on the tracks and I want to know how they did it, because every journey is different and there is something to be learned from it. In my own career, I’ve had to deal with many unforeseeable changes and challenges. Maybe I have and maybe I haven’t approved a lease that required the Landlord to provide gas service into the premises, only to learn that there was no gas service at the building. Maybe I had to coordinate the temporary closure of an entire four-lane freeway offramp in order to run said gas line into said building. Just maybe. The ability to understand the fundamentals of a capricious problem, evaluate options, and effectively execute the right solution is both art and science, revealing of character and competence. I’ve been called a Tree Hugger, but I answer most fondly to Decision Tree Hugger. Switching gears to a macro-perspective, BOMA San Francisco is staying at the forefront of the challenges associated with our economic tech boom. As we address our current challenges of Proposition M, retaining a talented workforce and the increasing cost of doing business (and living) in San Francisco, I can’t help but wonder what our next curve ball will be. I have no doubt that we will effectively face these issues with courage, diligence and professionalism. As your BOMA San Francisco President, I look forward to working with my esteemed colleagues on these challenges and adding to my ever-growing collection of lessons learned.

Thanks to BOMA San Francisco’s 2014 Corporate Sponsors* Platinum Sponsor

Able Services Gold Sponsors

ABM NRG Energy Center San Francisco ProTech Security Services, Inc. Recology Golden Gate Universal Protection Service

Silver Sponsors Alliance Roofing Company, Inc. AT&T BNBuilders CBRE Hines Kilroy Realty Corporation Metropolitan Electrical Construction, Inc. Pacific Gas and Electric Company Paramount Group, Inc. San Francisco Electrical Contractors Assn., Inc. Unique Elevator Interiors, Inc. Waxie Sanitary Supply

Bronze Sponsors Biagini Waste-Always Green Cassidy Turley Deutsche Asset & Wealth Management Equity Office Georgia-Pacific, LLC Hathaway Dinwiddie Construction Co. Hudson Pacific Properties Impark Marble West McMillan Electric Co. RiverRock Real Estate Group Securitas Security Services USA Shorenstein Realty Services, L.P. The Swig Company, LLC Township Building Services, Inc.

Friends of BOMA American Asphalt Boston Properties Capital Building Maintenance CBF Electric &Tel/Data Cole Supply CTC-California Technical Contracting, Inc. Cushman & Wakefield of CA GCI General Contractors LAZ Parking R.N. Field Construction, Inc. Rossi Builders, Inc. The Lawson Roofing Co. Inc. ThyssenKrupp Elevator Corporation Transwestern Wilson Meany Young Communications *For sponsorship opportunities, please contact Tory Brubaker at toryb@BOMA.com


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4 7 Reasons Why It’s Lucky To Use Union Carpenters 1 Training. Union carpenters receive four years of classroom and on-the-job training in the latest

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6 Principal Member Profile

Alyssa Freeman, Assistant Property Manager Boston Properties

From budgets to property walks to construction and tenant meetings, Alyssa Freeman juggles diverse responsibilities as Assistant Property Manager for Boston Properties’ Three and Four Embarcadero Center. “Embarcadero Center is a dynamic place and there are always a myriad of activities,” she says. The holiday season is especially busy, as Embarcadero Center is gearing up for the annual Building Lighting Ceremony. In previous years, she helped with day of festivities. But this year, as assistant property manager, she learned a lot about the engineers’ perspective and the preparation that goes into lighting these soaring towers. Freeman has been active in BOMA from the start of her commercial real estate career. At an undergraduate real estate event hosted by CREW, a woman recommended that she check out the BOMA website. She researched the industry and interviewed with Boston Properties, where she was hired. “Once I joined Boston Freeman likes to explore new cities and Properties, I was encouraged to get involved with BOMA’s YP Committee.” try out restaurants during her travels. “When I first joined the committee, there were skills I wanted to develop. My advice for other young professionals is to step outside your comfort zone. There’s no better place to take a leap than BOMA! Know your limits, but don’t be afraid to challenge yourself.” She eventually became the chair of the committee. And, at BOMA San Francisco’s annual meeting in October, Freeman was honored as Principal Member of the Year. When she has some time off, Freeman likes cultural events (ballet is a favorite), traveling and exploring new cities. She also enjoys DIY projects like home-making wine. Cheers to Alyssa for her many accomplishments!

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Associate Member Profile

Jessica Handy, Director, West Coast Operations, CodeGreen Solutions

As the Director for CodeGreen’s West Coast Operations, Jessica Handy helps clients fulfill their sustainability objectives — earning ENERGY STAR labels, achieving LEED certifications, monitoring and managing their electricity use and sustainability, and complying with local and state requirements. Handy brings this expertise to her role as vice chair of the BOMA San Francisco Energy & Environment Committee. During her three-year tenure with the committee, “a key trend I have seen is an increase in the general awareness of the value of saving energy.” “Energy efficiency, and sustainable operations in general, are being demanded by the latest generation of workers, and the biggest and most vocal companies brag about their sustainability efforts. Being more aware of energy and resource conservation is rapidly becoming part of the fabric of property ownership and management,” she adds. Handy’s involvement with BOMA goes back to 2003 in New York City, where Handy enjoys backpacking in Yosemite. she was on the board of directors before moving to California. She also serves on several BOMA Greater Los Angeles committees. Her experiences at BOMA have enhanced her career. “Because of BOMA, I have been able to learn a lot about California. This is a very big and legislatively active state. BOMA makes it possible for me to stay informed of the legislative changes that impact my work and that of my clients. Through my participation on the BOMA California Board, I’d like to think that I might help influence some of these changes as well.” Her contributions are appreciated, indeed! Handy was recently named Associate Member of the Year for 2014 by BOMA San Francisco. When she’s off work, Handy serves as president-elect of the Kiwanis Club of Santa Monica. She is an avid backpacker and hiker of California parks.


8

Code Updates (Continued from page 1)

Some tips: make sure all sheets are the same size and expediter, it’s best to have the design professional there or that no type is less than 1/8” high, and keep project have them available by phone for clarifications. descriptions short. The SFDBI is seeing problems with plans meeting “If you use an architect or engineer from out of state, accessibility requirements. DBI officials said to study the we strongly recommend that you administrative bulletin (AB 56 have an architect that is familiar for path and travel certificawith San Francisco and the tion) which is available online, process review the drawings prior since it is frequently updated. to submittal,” he said. Soskin Halloran said he wanted to advised that your architect be “demystify the disabled (DA) present, so they can make checklist.” There are three changes on the drawings. ways for projects to be DA However, only the contractor or compliant: owner can pick up a permit 1) Offer equivalent facilitation, without additional paperwork. 2) Technical and feasible— The audience then heard from Show that altering or removing Richard Halloran and Mark a structural element would be Walls of the SFDBI. The premise Seminar chair Gordon L’Estrange leads Title 24 discussion. required, and 3) Unreasonable for OTC is that for office TI hardship —This is based solely permit submittals, there is one hour of review for every on cost and must be approved by the city. It would apply department (mechanical, fire, etc). “We want to do what in a case in which the cost is going to kill the project. we can to make the process easier,” said Walls. He advised “We don’t want to kill projects,” he said. “We will help that if you see a plan checker who writes comments, try you fill out the forms” for technical and feasible and to see the same person when you come back. If you use an unreasonable hardship. (Continued on page 10)


9

Title 24: What the Future of Energy Efficiency Regulations Means for Commercial Landlords and Tenants Although the current atmosphere is one of uncertainty as to how Title 24 will be implemented and how significant the compliance costs will be, California’s commitment to green building and energy efficiency remains clear. The recent roll out of California Building Standards Commission’s 2013 Title 24 Code Regulations (“Title 24 Regulations”) that took effect on July 1, 2014, reaffirms California’s pledge to achieve its zero net energy goals for commercial buildings by 2030. The Commission continues to aggressively push forward with the next round of 2016 code requirements as stakeholders and policymakers are currently engaged in the “pre-rulemaking” process for the next iteration of 2016 Title 24 Regulations. As to the 2013 cycle, the most notable change is that Title 24 Regulations now apply to tenant improvements with a permit value of $200,000 or above, as well as building additions of 1,000 square feet or greater. The uncertainty of who will fund these tenant improvements, and more importantly whether building owners will bear the burden of upfront infrastructure costs to accommodate the Title 24-specific regulations, has been the most difficult concept for landlords and tenants to accept. As a result, there has been a great deal of apprehension in terms of how to properly allocate Title 24 compliance costs between landlords and tenants. This, in turn, has led to a decline in the number of building permit applications and, coincidentally, an increase in the number of leases where the parties reach an impasse and walk away from the deal. What is the solution? Unfortunately, there is no bright line answer, but candid discussions among the parties detailing the tenant’s needs and how those objectives can be achieved in a cost-efficient manner is a starting point. There are a few options to alleviate some of the cost considerations, ranging from the implementation of certain pass-throughs of operating expenses and CAM charges to be spread among all building tenants over the life of the lease term, or the inclusion of certain Title 24 compliance costs as part of the negotiated tenant improvement allowance. One thing is clear—Title 24 Regulations will encourage landlords and tenants to negotiate language in their respective letters of intent, leases, and work letters to address compliance costs head-on. In the past, the voluntary adoption of non-mandatory, incentive-based green building standards was thought of as a good marketing tool. This is no longer the case. The 2013 Title 24 Regulations are mandatory, when applicable, and while compliance will prove to be navigable (at least until the 2016 cycle takes effect), the new regulatory framework adds a layer of sizable cost considerations that will fuel the ongoing debate between landlords and tenants as to who should bear the ongoing compliance costs.

Report by Kimberly Huangfu, Real Estate & Land Use Associate/LEED AP BD+C, and Manuel Fishman, Partner, Buchalter Nemer. They may be reached at 415.227.0900 or khuangfu@buchalter.com or mfishman@buchalter. Visit www.buchalter.com.

Thank you to the Sponsors of the Annual Building Codes Seminar: Major Sponsor

Event Sponsors Angotti & Reilly, Inc. Buchalter Nemer Hathaway Dinwiddie LIONAKIS R.N. Field


10 Code Updates (Continued from page 8)

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Next was an overview of how California’s Title 24 Energy Code requirements affect typical office TI within an existing building—and the cost of that impact. L’Estrange noted that “in general, we estimate the electrical cost to increase 25-30% from pre-July 1, 2014” (the date regulations went into effect). BOMA members should be aware that the next code cycle for 2016 is already underway with proposed measures for elevator lighting, controls and HVAC modifications.

“We estimate the electrical cost to increase 25-30% from pre-July 1, 2014.” ­— Gordon L’Estrange, LIONAKIS Strategies to meet requirements were discussed, including: receptacle control — using controlled outlets to save energy and eliminate vampire loads; occupancy sensors; disaggregation of electrical circuits which separates loads by use for monitoring; lighting control systems; using LEDs in big office spaces; reduced lighting power and density; multi-level controls and daylight sensors. Julia Grinberg with PG&E said there are rebates and incentives for buildings to get low or no-cost LEDs. Commercial building managers should contact their PG&E representative to learn more. In making lighting alterations, it’s best to think about the future. More robust controls are more likely to meet future green requirements. “New products are being unveiled from companies like Wattstopper and Leviton,” said Bradley Onstad with CBF Electrical & Tel/Data Contractors. His firm likes to put in flexible systems.

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San Francisco fire officials observed that as companies grow in this bustling economy, buildings often overlook fire and safety procedures. Wiring such as “daisy chains” is commonly seen. Records must be kept for systems like fire alarms and life-safety egress. Kimberly Huangfu, a real estate attorney with Buchalter Nemer, notes that Title 24 will encourage landlords and tenants to negotiate language into their respective letters of intent, leases, and work letters to address compliance costs head-on. There is no bright line rule that clearly delineates whether landlords or tenants are responsible for government-mandated regulations. This determination often hinges on whether the upgrade is structural, the aggregate costs at issue and the length of the lease term, and who will ultimately benefit from the improvement. n


11 Victories for BOMA SF PAC-Backed Candidates and Initiatives The November 4th election brought more Republicans to Congress—in the main— while electing more moderate Democrats in San Francisco. BOMA’s Political Action Committee, the only one actively representing the interests of commercial real estate owners in local David Chiu will represent elections, had a significant San Francisco in the Assembly. success rate in the races and propositions on which the organization took a position. The key race was the one for the California Assembly that pitted Supervisors David Chiu and David Campos against one another. BOMA has had a long and positive relationship with David Chiu, the President of the Board of Supervisors, for years so it was no surprise that the organization endorsed Chiu early on. The BOMA-SF-PAC board appreciated Chiu’s practical approach to lawmaking by building consensus among all impacted parties before pushing legislation forward. Although the race was a close one, BOMA was gratified to see Chiu emerge victorious, and we look forward to his service in Sacramento as our

next Assembly Member. Chiu will join Phil Ting as the two Assembly Members representing San Francisco. BOMA also did a bold thing in supporting a new director for BART, Nick Josefowitz, as we felt change was needed there with a representative who would push harder to improve the downtown San Francisco stations. Josefowitz won in a surprise upset of the 24 year incumbent, James Fang. On the statewide propositions, BOMA supported both of Governor Brown’s top priorities: the water bond and the rainy day fund, both of which passed with wide margins. On the local level, BOMA supported the $500 million transportation bond, which passed, and opposed the so-called 24% “speculator’s tax” on residential property sales, which failed. BOMA also supported allowing artificial turf on Rec and Park playing fields and an affordable housing policy statement both of which passed. Our only loss was on our support for another policy statement focused on local transportation issues. The transit-first proponents easily defeated our call for a more balanced approach to managing cars in the City. The BOMA-SF-PAC appreciates the voluntary funding it receives from the membership and welcomes questions at any time. Contact Ken Cleaveland, Vice President/Public Policy, at kenc@boma.com to learn more about the PAC.

Members Elect New Directors; BOMA Board Elects New Officers Two new directors have been elected to serve on BOMA San Francisco’s board of directors. They are Marc Gille, Director of Asset Management for Embarcadero Capital Partners, and Jeff Needs, Senior Portfolio Manager for Hudson Pacific Properties. The BOMA San Francisco Board of Directors has elected new officers, whose terms run November 2014 through October 2015. Congratulations to newly elected Treasurer Wes Powell, International Director, Jones Lang LaSalle; President-Elect John Combs, Principal, RiverRock Real Estate Group; and President Blake Peterson, Portfolio Manager, Investor Services, Cushman & Wakefield. Continuing her service as a member of BOMA San Francisco’s Executive Committee is immediate past president Sarah MacIntyre, Asset Manager, Kilroy Realty Corporation. Marc Gille

Jeff Needs


12 Emergency Preparedness (Continued from page 1)

First Street building in the offices of its tenant, Box. Both emergency situation: the San Francisco Fire and Police departments’ first • Communicate with tenants. Even if you don’t have all responders participated in the exercise. the details, let tenants know that you are aware that someAt the recent Emergency thing is going on. Prepare a statement that security can Preparedness Seminar, committee give to tenants and others. members, police and fire personnel, • Communicate with upper management. “We didn’t and property professionals shared some have a way to communicate with upper management of the highlights of the drill. “At the before the drill. We established a company-wide proceend of the day, this is going to save lives,” dure,” said Eileen Kong, Senior Asset Manager for Kilroy. said San Francisco Police Chief Greg Suhr • Prepare materials in advance. Sean Bennett, chief about the drill that engineer of Able Engineering Services, allowed the police and said it’s important in an emergency that “At the end of the day, this fire departments to police have keys to your building and is going to save lives,” — work with property be given printouts of every floor in a Greg Suhr, SF Police Chief professionals to improve binder. emergency plans. San • Harness technology. Kelly Francisco Fire Chief D’Innocenti, workplace services adminJoanne Hayes-White remarked: “The more istrator for Box, uses an app called XMatters that allows we can plan, the better.” the company to communicate with employees with a “Our goal for the seminar was for people to have simple blast. You can do a roll call of your employees something they can take back to the office to make them and account for them. As a tech company, Box had in more prepared,” said Committee Chair Ryan Rusler, place plans for business continuation in the event of an who led the program. These are some tips shared by the emergency. speakers in a panel discussion. Many can be applied to any • Tighten access to your building. Captain Ann Mannix of the police department’s tactical unit emphasized the need to “harden your target.” Make it difficult for peoYour commercial ple to enter your building and use controls that prevent IPM/Green/LEED specialists intruders from operating elevators. The best advice in an active shooter situation is run/hide/fight. Transamerica Pyramid Center’s Director of Security Jackson Talbot presented some best practices in active shooter situations. Remember “RAIN” — Recognize, Avoid, Isolate and Notify. Learn to recognize sounds of danger such as explosions and screams and call security. n Serving commercial property

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14 Congratulations to Members of the Year!

BOMA-SF-PAC Goodbyes BOMA San Francisco members of the year were honored at the Annual Meeting: Associate Member of the Year Jessica Handy, CodeGreen Solutions; Blake Peterson, BOMA SF President; and Principal Member of the Year Alyssa Freeman, Boston Properties.

The BOMA-SF-PAC said goodbye to three long-serving board members: Mike Freeman, McCarthy Cook, served 19 years on the board and two years as chair; Nancy Gille, Real Systems, served eight years with three years as treasurer; and Jim Christian, DRA Advisors, served 19 years with four years as chair. Thank you for your dedication and service to BOMA’s Political Action Committee!

Appreciating Our BOMA Volunteers! Have you enjoyed a BOMA golf tournament or wine tour? Been inspired at the Innovative EARTH Awards luncheon? Sharpened your knowledge at an Emergency Preparedness seminar? Or made valuable contacts at a BOMA networking event? If so, you can thank the many dedicated BOMA members who volunteer their time and talents to our organization. We appreciate the countless hours they spend helping make our BOMA such a vibrant association. Are you interested in joining a BOMA committee? Depending on your skills and interests, we can help you identify one that’s a good fit.

BOMA Executive Vice President Marc Intermaggio with Emergency Preparedness Committee Chair Ryan Rusler.

Visit the Committees page on our website for key committee leadership contacts (www.bomasf.org), then reach out to the relevant committee chair to learn more.


15 Mixing & Mingling Scenes from the BOMA Young Professionals Boat Cruise and the annual un-Oktoberfest.

Young Professionals Boat Cruise

Above left: Team Able – Sam Shapiro, Jeff Dachenhaus, Grant Frazier, Sean Kelly and Craig DeMartini. Above right (in circle): BOMA YP friend; Ryan Mahoney, McMillan Electric Company; and Mary Milazzo, Cupertino Electric Company.

Un-Oktoberfest Far right: crowd scene at the un-Oktoberfest. Near right: Robert Dawes, ABM and Michelle Funkhouser, Hines, visit with a friend at the event.

Thank you to SC Builders for sponsoring un-Oktoberfest! About BOMA VIEWS Views is published quarterly by BOMA San Francisco. Associate Publisher: Tory Brubaker Editor: Henry Eason Ad and Art Director: Ellen Eason Eason Communications LLC Reach your prospects through BOMA Views in 2015. Discounts available for annual advertising buys. Contact Ellen Eason at 415.596.9466 or ellen@easoncom.com


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The Last Word: Marc Intermaggio Women Leaders Drive BOMA A guest approached me after our recent annual meeting and remarked how impressed she was by our cadre of women in leadership positions. Used to be that BOMA might have stood for Bald Old Men of America. Not anymore — and surely not at BOMA San Francisco! As more and more women have entered various disciplines of commercial real estate, property and asset management have certainly benefited. So too, has BOMA San Francisco. To wit: Sandra Boyle chairs the board of the BOMA San Francisco Foundation and its newest industry-changing endeavor — to identify, train, recruit and diversify commercial real estate’s future workforce. Sandra also happens to have been BOMA San Francisco’s first woman president, elected in 1995. Other women presidents have included Marsha Ramsey, Lisa Vogel, Kathy Mattes, Kirsten Walraven, Margot Crosman, Anne Hinz, and of course our immediate past president, Sarah MacIntyre. Newly elected president Blake Peterson continues the tradition of women leaders at BOMA San Francisco. Other women presently serving on our board include Elizabeth Trowbridge, Deborah Boyer, and Tawni Sullivan. Tawni is also vice chair of the BOMA San Francisco Foundation.

Other women serving on our Foundation board include Michelle Funkhouser, Marsha Ramsey and Linda Oubre. But wait—there’s more! Kathy Mattes chairs BOMA’s Leadership Development and Nominating Committee. She also chairs BOMA’s Political Action Committee. Nicole Dubee chairs our Careers in Real Estate Committee; Christine Mann chairs our Education Committee, with Amber Miller serving as vice chair of that committee. Our Energy and Environment Committee is chaired by Jenna Hattersley, and is vice-chaired by both Jessica Handy and Laurie Rummelhart. Lynn Tolin is vice chair of our Government Affairs Policy Advisory Committee. Stefanie Medious chairs our Membership Services Committee. Brooke Barnecut now chairs our Young Professionals Committee, and Julie Venegas is vice chair. The immediate past chair of the YP group is Alyssa Freeman, who notably was selected Principal Member of the Year for 2014! Let’s not forget the BOMA Staff— where able women provide stellar service. LaMata Lewis is Director of Accounting, Akiba Davis is Education Coordinator, Tory Brubaker is Member Services Director, and Nicole Cui serves as Office Operations Manager. Look around at any BOMA San Francisco event, and most likely you’ll observe at least half of the participants are women. It should be no surprise that women serve in quite a few leadership roles within our Association. They have undoubtedly enriched BOMA San Francisco’s community of commercial property professionals and have helped keep BOMA San Francisco relevant to the needs of its members! Marc Intermaggio, CAE, is the Executive Vice President of BOMA San Francisco. BOMA women leaders at last year’s BOMA holiday party. From top: Stefanie Medious and Sarah MacIntyre; Michelle Funkhouser; Anne Hinz and Deborah Boyer.

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News from the Building Owners and Managers Association of San Francisco

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