If you own, manage or are a tenant in a commercial building
PAY ATTENTION!
No where is there more dramatic opportunity for loss of revenues then in a commercial office building that has not prepared for business interruption.
Each situation is unique in its risks for the owner, and the tenant, each property its own profile, the answer lies in evaluating by the right questions and planning for the right contingencies, either through mitigating the risk, or outsourcing it to a 3rd party through proper insurance coverage.
For the Owner/Manger
- insurance risk, tenants may not disclose or have sufficient insurance for repairs to tenants on the adjoining floors or units, you will be named
- asset preservation - from the loss of the structure, to interruption from major transportation routes, insufficient insurance
- leasing - new tenants especially U.S. based companies require the base building to have a business continuity and disaster recovery plan
- tenant retention, in a tight market it is a value added service to tenants that you need to provide for yourself and the tenants, but by insuring they have a plan, you reduce your risks as well
- maximizing revenue - if a building or a major tenant is out of commission long enough the tenant will miss rent, or go bankrupt. Studies have shown many businesses that have to close for 3 weeks, never recover. Their customers go to number 2, or insurance or the banks will not provide the funds to recover.
- you rely on the base building for the necessities, from communications (how many trunk lines into your building, what if one is cut by a back hoe, or as I.T. professionals call them cable seeking devices), water, hydro, elevators, parking
- your insurance coverage must protect you from other tenants actions and activities
- never is the opportunity greater for events out of your control, to control your destiny, prepare by having a plan yourself, and integrating it with your landlord
