The BOMA Magazine - November/December 2011 by lprats

Achieving High Performance Through Innovation

November/december 2011

Leadership Strategiesâ&#x20AC;&#x201D; Leveraging Technology, Customer Service and Skillset

Plus:

Sustainable Service Solutions for Elevators What You Need to Know About the Lease Accounting Changes 10 Ways the New ADA Regulations May Affect Your Building

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November/December 2011 Volume 7, No. 6

24 32

28 30 Leadership Strategies for Enterprise Leaders Laura Horsley Changes in customer service, technology and job descriptions are elevating the role of the traditional PM.

Lawrence G. Perry, AIA

Exploring Sustainable Service Solutions for Elevators Sasha Bailey, LEED AP BD+C Cost-effective products and practices that help achieve reductions in material use, energy and waste.

For advertising rates and information, contact Paul Hagen at Stamats Business Media 866-965-4205. Connect with BOMA

See BOMA on YouTube: www.youtube.com/ bomainternational Follow BOMA on Twitter:

Volume 7, No. 6 The BOMA Magazine November/December 2011, (ISSN 15324346), Copyright 2011. The BOMA Magazine is published bimonthly in January/February; March/April; May/June; July/August; September/October; and November/December by the Building Owners and Managers Association (BOMA) International, 1101 15th St., NW, Suite 800, Washington, D.C. 20005; Telephone 202-326-6300; Fax 202-326-6377; www.boma.org. Periodicals Postage paid at Washington, D.C. and additional mailing offices. POSTMASTER: Send address changes to: The BOMA Magazine, Attn: List Department, 1101 15th St., NW, Suite 800, Washington, D.C. 20005. Undeliverable U.S. copies should be sent to: The BOMA Magazine, Attn: List Department, 1101 15th St., NW, Suite 800, Washington, D.C. 20005. Return undeliverable Canadian addresses to: PO Box 875, STN A, Windsor, ON N9A 6P2.

Serena Wolfe and Josh Herrenkohl Global changes are on the horizon. Make sure you’re prepared.

Lindsay Tiffany The information you need to understand and implement the new requirements.

Message from the Chair

Keep Talking, Lawmakers Are Listening.

Legislative Update DOE’s asset rating program, the latest on DOL’s “persuader” rule, FIRPTA, carried interest. Plus, notes from NAC.

State & Local Update A big victory in California, BOMA/ Carolinas-West Virginia and BOMA/ Greater Cincinnati launch voluntary energy challenges.

BOMA President Henry Chamberlain @ HenryBOMA BOMA Vice President Lisa Prats @ LisaPratsBOMA

What’s All the Fuss About Lease Accounting?

Top 10 Ways the ADA Standards Will Impact Buildings

DEPARTMENTS

Join BOMA on Facebook Join BOMA on LinkedInJoin the EER and BOMA 360 User Groups

BOMA Inte rnAtIOnAl

Guide to the 2010 ADA Standards

Trends and news from Canada—BOMEX recap.

36 GREEN SCENE

Don Totten “Green” paper meets the fiber age.

Research Corner Three common challenges to calculating escalations.

46 Eye on Education Two new options for mastering the BOMA Office Measurement Standard.

Codes & Standards Update An innovative path to codes compliance, New Mexico rolls back energy code, a global energy-efficiency standard.

Trends Tracker

BUYERS’ GUIDE Check out the latest products and services.

50 CONFERENCE

Leading the Way Scott Jones—engineer, designer, Eagle Scout.

20 around the industry

CONNECTION

Former Defense Secretary Robert Gates to keynote BOMA 2012.

Empire State Building goes for gold, the latest vacancy numbers, WBM/NIC details, In Memoriam—Lynn Bellenger.

November/December 2011 The BOMA Magazine

Message from the Chair

Keep Talking, Lawmakers Are Listening BOMA Advocacy is on a roll. This past September, BOMA California claimed a critical victory when they helped successfully defeat Assembly Bill 350, which, if passed, would have mandated that new building owners retain all of the existing service contractors’ employees from the previous building owner and would not be able to bring in new service contractors with different employees. It was a bill that was short-sighted, bad for business and nearly passed but was finally voted down after a seventh floor vote (see “State & Local Update,” pages 14-15). BOMA California leveraged BOMA’s Industry Defense funds (IDF) to educate lawmakers on the potentially farreaching negative impact of AB 350 and gained the bi-partisan support that eventually killed the bill. And, although the number of Senate floor votes was unprecedented, the BOMA-supported success was not. Less than a year ago, another IDF-funded BOMA campaign helped stop Amendment 4 from passing in Florida, a measure that would have increased taxes and derailed growth by requiring all the state’s voters to approve all local and comprehensive land use plan changes. These are just two examples of the breadth and tenacity of the BOMA grassroots network and the effectiveness of the IDF dollars. Not only were these bills bad for business in California and Florida, but they had the potential to set a precedent for similar legislation in other states. It didn’t happen because BOMA didn’t let it happen. Our next opportunity to have our collective voice heard at the table of lawmakers is during the National Issues Conference (NIC), held this year in conjunction with BOMA’s Winter Business Meeting in Washington, D.C., January

30-February 1 (see “Around the Industry,” page 20). I’ve participated in NIC several times, and few things get the adrenalin pumping more than having actual face time with your senator or representative on Capitol Hill. We hear great stories from NIC attendees who not only had face time with legislators, but also saw real results, such as the time BOMA Executive Committee member Brian Cappelli spoke to his congresswoman on national energy policy and a few days later heard her speaking on the radio, referencing the very talking points he gave her. Now is the time to have your voice heard. During NIC, the BOMA Advocacy staff does a great job prepping members for their visits during the “How to Lobby Workshop” before we hit the Hall of Congress with commercial real estate’s message. Plus, you’ll gain insight and humor from Congressional speakers and Keynote Speaker Tucker Carlson. All of our issues are in play this session—whether it’s carried interest, energy or storm water runoff—and we especially need to remind lawmakers of the perils of over-taxing and over-regulating an industry that contributes more than $118 billion to the U.S. economy and one million direct jobs through building operations alone. Let’s keep up the success; let’s keep rolling. I look forward to seeing you in Washington in January!

Boyd R. Zoccola Chair and Chief Elected Officer

The BOMA Magazine November/December 2011

Publisher: Lisa M. Prats, CAE Editor: Laura Horsley Associate Editor: Lindsay Tiffany Contributing Editors: Karen W. Penafiel, CAE, Ronald Burton, James Cox, Henry H. Chamberlain, APR, FASAE, CAE, Lorie Damon, Ph.D., Tracy Glink Designer: Amy Belice Published by: Building Owners and Managers Association (BOMA) International

BOMA International Officers Chair and Chief Elected Officer Boyd R. Zoccola Hokanson Companies, Inc. Indianapolis, Ind. Chair-Elect Joseph W. Markling CBRE Los Angeles, Calif. Vice Chair Richard W. Greninger, CPM Carr Properties Washington, D.C. Secretary/Treasurer Rebecca B. Hanner, CPM, RPA Cassidy Turley Raleigh, N.C. President and Chief Operating Officer Henry H. Chamberlain, APR, FASAE, CAE BOMA International Washington, D.C. Call for Nominations: Vice Chair and Executive Committee Members

BOMA International’s Nominating Committee is seeking candidates for the position of vice chair and for five principal members and one associate member of the Executive Committee to the Board of Governors. For further information, contact Ann Coslett at acoslett@boma.org.

The cost for The BOMA Magazine is $75 a year for subscribers and $50 a year for BOMA International members. Publication of advertising should not be deemed as endorsement by BOMA International. The publisher reserves the right in its sole and absolute discretion to reject any advertisement at any time submitted by any party. Material contained herein does not necessarily reflect the opinion of BOMA International, its members or its staff.

legislative UPDATE

BOMA Weighs In on DOE Asset Rating Program On September 22, BOMA International filed comments to the Department of Energy (DOE) in response to a notice of request for information on DOE’s plans to develop a voluntary National Asset Rating Program for Commercial Buildings (AR Program). The AR Program would establish an asset rating system for commercial buildings based on a national standard and would evaluate physical characteristics and asbuilt energy efficiency of these buildings. DOE plans to have an initial program design available soon and will launch a pilot program in early 2012, though it has promised that there will be future opportunities for stakeholders to provide input. BOMA International outlined several concerns in its comments about this type of program. First and foremost, BOMA questioned the need for the AR Program when there are already several programs, certifications and tools available in the marketplace. In addition, though DOE calls it a “voluntary” program, BOMA has concerns that states/ cities may mandate it as they move forward on benchmarking and disclosure laws. With that in mind, it’s critical that DOE gets this right and BOMA will continue to participate in the ongoing dialogue.

BOMA International Joins Comments Urging Withdrawal of DOL’s ‘Persuader’ Rule In September, the Coalition for a Democratic Workplace (CDW ) filed comments requesting the Department of Labor (DOL) to withdraw a proposed rule that would reverse decades-old exemptions to disclosure requirements for advice and legal counsel that businesses seek regarding unionization. The proposed rule would force employers and their attorneys to disclose sensitive financial details, even if an employer’s attorney or hired consultants do not directly interact with employees. BOMA International joined CDW and 265 other employer organizations in the comment letter asking DOL to withdraw the rule from consideration.

FIRPTA Legislation Introduced in Congress Legislation that will help increase foreign investment in U.S. real estate was recently introduced in both the House and Senate. Like similar legislation that passed the House overwhelmingly last summer, H.R. 2989 and S. 1616 would increase—from five percent to 10 percent—the ownership stake that a foreign investor may hold in a publicly traded real estate investment trust (REIT) without being subjected to onerous reporting and administrative requirements under the Foreign Investment in Real Property

Tax Act (FIRPTA). In countries where it is consistent with U.S. tax treaties, when applying this ownership test, H.R. 2989 and S. 1616 would “look-through” to the individual investors in foreign mutual funds that, in turn, invest in U.S. REITs. The legislation also would reverse an onerous 2007 ruling by the Internal Revenue Service (IRS Notice 2007-55) that expanded FIRPTA’s reach—applying the law to liquidating distributions received by foreign investors from private, domestically controlled REITs. BOMA International supports the repeal or amendment of FIRPTA and will continue to work with Congress to enact this legislation.

Carried Interest Tax Increase Emerges in President’s ‘Jobs’ Proposal In early September, President Obama unveiled his $447 billion proposal to help the country’s sluggish economy and help put the unemployed back to work. While the bill includes incentives to small business to hire and cuts to the payroll tax, it also includes the tax increase on carried interest as a revenue offset. It is estimated that changing the characterization of carried interest from a capital gain to ordinary income would raise $18 billion. BOMA International continues to actively oppose this major and permanent tax increase to a primary form of real estate investment in favor of short-term tax incentives. Continued on page 10

The BOMA Magazine November/December 2011

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legislative UPDATE Posting of Union Rights Notice Rule Final On August 30, the National Labor Relations Board (NLRB) posted a final rule that will require most private U.S. employers to post a notice regarding employees’ rights to unionize. The notices will be available for free from the NLRB as of November 1, and must be posted beginning November 14. The notices spell out workers’ rights to form or join labor unions, picket and strike and bargain collectively without facing retaliation. Other than stating that employees have the right to refrain from those activities, there’s no mention of a right to decertify a union or how to do so. In response to this notice, a lawsuit seeking a preliminary injunction against the regulations has been filed by the National Association of Manufacturers.

and the Regional Owners Council (ROC), a network for owners or equity partners of single or regional market commercial real estate, gathered recently in California. The meeting focused on the economy, human resources and talent, as well as future trends that will impact commercial real estate. The top issues on attendees’ minds: • Talent retention coupled with limited resources for salary adjustments and bonuses. • Future of the workforce and how it will influence commercial real estate. • “Coopetition” (cooperation among competitors). • An unnerving, uncertain economy.

The Economy, Talent, Collaboration and More Discussed at NAC BOMA’s National Advisory Council (NAC), an exclusive network of senior commercial real estate professionals,

Paul Adler with the Marshall School of Business at USC discusses the power of collaborative intelligence.

Paul Adler, professor of Management and Organization, Marshall School of Business at USC, discussed the power of collaborative intelligence and the correlation between a highly structured company that has no new ideas to a highly entrepreneurial company that has incredible new ideas and energy but can’t accomplish anything. There is a need for both in a successful company. (Harvard Business Review, July-August 2011) Asieh Mansour, head of Research, Americas, CBRE Research Operations, predicted NO double-dip recession— not because the economy is hitting on all cylinders, but because you can’t technically have a double-dip recession unless it occurs within four quarters and we have had eight quarters of recovery. The typical recovery from a financial crisis takes three to five years. For her, the rays of economic hope center on the fact that profits per employee are at an alltime high indicating hiring should begin; small businesses are beginning to access Continued on page 12

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The BOMA Magazine November/December 2011

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legislative UPDATE

Asieh Mansour with CBRE Research Operations finds economic “rays of hope.”

bank loans and are hiring; and that the economy has deleveraged a lot. She sees office vacancy dropping to its natural rate of 13 to 15 percent by the first quarter of next year. Cushman & Wakefield’s Frank Freda talked about a report out in New York saying the financial sector will consolidate its space needs by fully onethird over the next decade, and there

were several unresolved conversations about what new space needs will mean for existing space in the future. Predictions for growth sectors include hightech manufacturing; social media; auto and equipment manufacturers; agriculture; biotech; and healthcare and education, which never really slowed.

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The BOMA Magazine November/December 2011

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Steve Picarde, president of PI Midlantic, talked about the need for mixed recruiting tools in building staff teams. The overall turnover rate is 40 percent, of that the voluntary turnover rate is 23.4 percent. Who are all of these people leaving their jobs in this market? Shockingly, 50 percent of resumés contain fraudulent info. An interview alone is two percent better than a coin flip, partially because the interviewers are not any better at it than the interviewees; most decisions are made in the first five minutes of an interview. An assessment tool adds objective measures to the process. He also stressed that teams need a mix; you can’t have 10 strong personalities with the need to win. BOMA International leadership and staff attending included BOMA Chair Boyd Zoccola, BOMA President Henry Chamberlain and BOMA Vice President of Advocacy Karen Penafiel. Co-hosting the event were Wells Real Estate Funds’ John Oliver for the NAC members and Kiemle & Hagood’s Larry Soehren for the ROC members. Vornado/Charles E. Smith’s Patrick Terrell will take over the NAC duties for the spring meeting. For more information on either the NAC or ROC, go to www.boma.org/member ship.

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state & local update

BOMA California Defeats AntiBusiness Right to Hire Legislation California’s business community, led by BOMA California, the California Business Property Association and the California Chamber of Commerce, defeated Assembly Bill 350, one of the most far-reaching pieces of legislation to impact the state’s commercial real estate industry in years. The bill required service providers to hire a previous contractor’s employees each time a new contract is generated. On an unprecedented seventh floor vote in two days, the California Senate finally voted the bill down on a bipartisan vote as one of the last acts of its legislative year on Sept. 10, 2011. BOMA California leveraged the BOMA International Industry Defense Fund to mount a campaign against the measure, and to form the “No on AB 350” Coalition, a group of business, healthcare, tourism and service providers. Members of the coalition included BOMA

California, the California Chamber of Commerce, NAIOP of California, the California Hospital Association, the California Grocers Association, the California Attractions and Parks Association, the California Hotel & Lodging Association, Able Services and Paragon Services Janitorial. The campaign’s lobbying effort in Sacramento was greatly aided by a media effort, which generated 20 newspaper editorials voicing opposition to the bill. BOMA members also mobilized a heavy grassroots effort to educate legislators on the bill’s damaging impacts. “At the same time legislators and Governor Brown are stressing the need to ease regulatory burdens on business to improve the economy and jobs, this bill would have done the exact opposite—putting more onerous requirements and costs on small businesses,” says Ray Magnussen, president of BOMA

California and president of Paragon Services in San Diego. “We all breathed a huge sigh of relief when the Senate rejected this anti-jobs and anti-small business measure.” Assembly Bill 350 required employers with new contracts for property services, such as building maintenance, licensed security, window cleaners and food cafeteria services, to hire all of the prior contractor’s employees for at least 60 days. The bill impacted any property with service contracts, including hospitals, commercial properties, restaurants, grocery stores, universities and hotels. These same constraints applied to the sale of a building. A new owner would be mandated to retain all of the existing service contractors’ employees from the previous building owner and would not be able to bring in new service contractors with different employees. Similar successful efforts to pass this type of law have been seen in local markets around the country; however, stopping this bold first attempt to apply the law to an entire state will help stymie future efforts.

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The BOMA Magazine November/December 2011

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BOMA/Carolinas-West Virginia and BOMA/Greater Cincinnati Launch Voluntary Energy Challenges BOMA/Carolinas-West Virginia and BOMA/Greater Cincinnati have launched Kilowatt Crackdowns, voluntary energy reduction competitions, demonstrating their commitment to reducing operating costs and improving building energy performance in their respective markets. These competitions are an engaging way to calculate a facility’s ENERGY STAR® rating using the Portfolio Manager benchmarking tool, improve that score within one year and tremendously impact energy savings. Key sponsors of the competition include Duke Energy and ENERGY STAR. “This is a great and fun opportunity to partner with Duke Energy to lower energy consumption,” says Jeannie Bechtold, president of BOMA/Greater Cincinnati. “Efficiency translates to reduced costs, which creates value for our tenants, owners and investors. It’s about positioning buildings for the future—making sure they have the power to attract tenants and in a market where competition and demand for well-operated, energy-efficient properties continue to grow.” Based on a model developed in Portland and Seattle, this free contest supports building owners and property managers in benchmarking their facility’s energy performance and implementing strategies that lead to greater efficiencies and reduced operating expenses over the course of 2012. Participants will have access to a variety of technical resources, training opportunities and one-on-one assistance to support them throughout the process. At the end of the competition, the Kilowatt Crackdown will crown energy-efficiency “champions”—recognizing the most energy-efficient buildings in these markets along with the properties showing

w w w . K W C D - C a r o l i n a s . c o m

the greatest gains in performance. “Duke Energy is proud to partner with BOMA and IREM to bring the 2012

Kilowatt Crackdown to Cincinnati,” says Sue Laufenberg, commercial market manager at Duke Energy. “By providing education about energy efficiency and cash incentives to invest in equipment upgrades, building owners and managers can better serve their tenants and the Cincinnati community as a whole.” For more information, visit www. kwcd-cincinnati.com or www.kwcdcarolinas.com.

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Codes & Standards Update

BOMA Teams with Partners on Innovative Code Compliance Path BOMA teamed with AIA, New Buildings Institute, the U.S. Department of Energy and the National Trust for Historic Preservation to support approval of an innovative compliance option for International Code Council’s (ICC’s) International Green Construction Code (IgCC). The proposal would modify the first edition of the IgCC (2012) to allow an

“Outcome-Based” compliance method as an alternative to the prescriptive or modeled performance options. This Outcome-Based option allows owners and developers and their design teams to employ innovative strategies and technologies to comply with the energy provisions of the IgCC by demonstrating the actual energy performance of a building without the time and cost of obtaining code variances. The proposal includes energy performance targets for eight building types in all U.S. climate zones. At press time, this proposal was to be considered for approval by ICC voting members in the Final Action Hearing in Phoenix early in November. BOMA’s codes and standards advocacy staff will have a comprehensive summary of the Phoenix hearings in the next edition of

The BOMA Magazine. For more on this proposal and the ICC hearings, contact Ron Burton at rburton@boma.org.

New Mexico Rolls Back Energy Code The New Mexico Construction Industries Commission (CIC) recently voted to replace a 2010 statewide energy code that was more stringent than federal guidelines with the slightly less stringent 2009 version of the International Code Council’s International Energy Conservation Code. The move was part of Governor Susana Martinez’ pro-business agenda and was focused on the costs vs. benefits of one of the more stringent energy codes in the nation and concerns over unnecessary and burdensome standards that could affect growth. Opponents of the CIC decision say that repealing the 2010 code will cost more taxpayer dollars and that the repealed code would have helped the state’s residents and businesses save money on electric and gas bills by reducing energy consumption about

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20 percent. A coalition of groups has mounted a legal challenge to the CIC decision.

New Global Energy-Efficiency Standard The International Organization for Standardization (ISO) recently issued a global energy-efficiency and energy management standard, which ISO says will help organizations worldwide save money in their buildings and industrial facilities. ISO 50001 was developed by a project committee of 45 partnering countries and provides a framework for continuous energy use of existing equipment and facilities; requires the use of energy performance data to target cost-effective upgrades; and emphasizes design and installation of highly efficient systems and equipment. The new standard also addresses integration of energy efficiency into management practices, benchmarking and reporting energy use and savings. The standard development project was based on five U.S. industrial pilot projects conducted between 2008 and 2010, which achieved efficiency improvements of 6.5 percent to more than 17 percent. Implementation of ISO 50001 is supported by the U.S. Department of Energy (DOE) for industrial and commercial facilities through its voluntary “Superior Energy Performance” certification program scheduled to roll out in 2012. The DOE will also coordinate implementation of the new standard for federally owned facilities. It is not clear how this new international standard will impact federal office buildings or how it might influence the development of energy codes in the United States. BOMA’s codes and standards advocacy team is closely monitoring these developments and will provide regular updates. For more on this new international standard, contact Ron Burton at rburton@boma.org.

ICC Code Action Committees Meet BOMA’s codes and standards advocacy staff participated in the first meeting of the International Code Council’s (ICC’s) four new code action committees (CAC) in Chicago in September. The CACs are charged with pursuing opportunities to improve and enhance the International Codes, including both the technical aspects of the codes as well as the scope and application of referenced

standards. The ICC Board approved the creation of three new code action committees for the 2012/2013 Code Development Cycle to join the existing Fire CAC. The committees cover the Building (IBC), Residential (IRC), Fire (IFC), Plumbing (IPC), Mechanical (IMC), Fuel Gas (IFGC), Energy (IECC) and Green Building (IgCC) codes and will develop code change proposals and participate in the code development process. Three

more meetings of the CACs are planned prior to the January 2012 submission deadline for code change proposals for the 2012 code development cycle. BOMA will continue to represent the interests of the commercial real estate industry, and BOMA members in particular, as these new committees work to modify the ICC codes. For questions or comments, please contact David P. Tyree, P.E., C.B.O. at dtyree@boma.org.

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November/December 2011 The BOMA Magazine

Sometimes the brightest idea for attracting and retaining tenants comes from the inside.

Next to price, parking and location, having access to advanced communications services inside your building is the most important selling pointâ&#x20AC;&#x201D;making it your new competitive advantage when marketing your building to new tenants and retaining existing ones. In fact, the topic of access to advanced communications services is raised in 75% of negotiations with prospective tenants. Get connected and get them in.

To learn what other building owners and managers are saying about advanced communications, download the 2011 State of Communications Services in Commercial Real Estate Report at business.comcast.com/BuildingReport

leading the way

Scott Jones Engineer, Designer, Eagle Scout

Scott O. Jones, PE, is a principal with Jacobs Engineering GroupGlobal Buildings, where he is responsible for commercial aviation and corporate commercial design projects in the Southwest Region of the Buildings Division. In this position, he is involved in the management of architecture and engineering activities for a variety of clients. Jones has extensive volunteer leadership experience, serving as both president of BOMA/Fort Worth and director of Texas BOMA. He is chair-elect of the 2011-2012 State Government Affairs Committee and is a member of BOMA International’s Executive Committee.

BOMA members. In Fort Worth, I was successful in linking the BOMA local and ASHRAE chapter to host joint luncheons. ASHRAE has a distinguished lecturer series, and for the last couple of years we have linked BOMA’s November Luncheon around that series. This is a great way to leverage the talent of that group to bring value to our BOMA members.

How do you hope your engineering and design skill set will enhance the strategy and leadership of BOMA International?

The current fiscal and tax revenue policies may be the largest threat to industry, but a lot of people are also concerned about the political tone out there to make the building stock green overnight. We need to have sustainable properties, but we need to achieve this in a cost-efficient manner. I worry that local municipalities may approve new codes right out of the box before they are fully vetted. It’s easier for new buildings to meet these mandates than existing buildings. As local municipalities race to become the greenest, hopefully it is balanced with achievable goals that are cost effective. Ron Burton and his codes staff at BOMA International do an outstanding job of being at the table as the codes are developed and protecting BOMA members from unnecessary costs that would be written into code otherwise.

My engineering background gives me a slightly different mindset, and my experience designing buildings gives me a better technical understanding of how some of the “big building” topics merge together. I think I bring technical challenges to the Executive Committee, such as how can our buildings better utilize and manage energy or how can we use BIM (building information modeling) to make better operating decisions translating to better ROIs. I also provide input on how the model codes are changing and what the future impact will be. All these trends have significant bottomline impacts.

Tell us about your activities with building codes groups. The first organization I joined out of college was ASHRAE. In building design, I rely heavily on its resources, many of which can be beneficial to

You are very active on advocacy issues for Texas BOMA and BOMA International. What’s the most important issue before us?

You established the Sustainability Committee for BOMA/Fort Worth. How can takeaways from that experience translate to other BOMA locals?

We started this committee to educate members on sustainability topics and stay in front of legislative issues in the state. There are so many messages on this topic; it can be hard for people to determine the good ideas from the bad when the message seems to be “everything has to be green.” It’s important to be sustainable—sometimes it’s driven by the market and other times it just makes good business sense. Either way, building owners and operators need to stay active and be part of the conversation because it sets your property apart from the competition. In Fort Worth, we developed the “green minute,” where you take five minutes during the BOMA membership meeting and highlight a sustainable practice or a new product. It’s a great way to exchange information and educate membership on trends in the industry. Committees such as these can also help BOMA be a resource in the community. In Fort Worth, I was assigned to sit on the city’s sustainability task force. This is a great opportunity for BOMA locals to voice our views on the subject, plus the information from BOMA is a great resource for the city staff.

What is something that most people don’t know about you? Most people don’t know that I’m an Eagle Scout. The outdoor experiences I was exposed to were simply fantastic. We went on numerous high adventure treks, and the challenges I faced taught me how to manage adversity. My two girls are now involved in Girl Scouts; one is a brownie and the younger one is a daisy. My “daisy” told me recently that they were allowed to strike three matches at a meeting. My thoughts were—I sure hope they’re reinforcing fire safety.

November/December 2011 The BOMA Magazine

Around the industry

Show Congress How to Get Business Done Get the scoop from political insider Tucker Carlson, earn your lobbying stripes and shape the future of commercial real estate—all in three days. BOMA International’s combined 2012 Winter Business Meeting and National Issues Conference, January 30-February 1, 2012, in Washington, D.C., offer members from across the country a forum to discuss and debate the most pressing issues in commercial real estate and provide a unique opportunity to take real estate’s message to legislators and regulators on Capitol Hill. To save participants time and money, this year’s conference is condensed into three power-packed days of learning, networking and advocacy. Po l i t i c a l analyst Tucker Carlson will be the featured

speaker at the Keynote Luncheon. Carlson brings insightful commentary infused with humor and passion to today’s political landscape. As a contributor to FOX News, the editor-in-chief of the Daily Caller news site and a senior fellow at the Cato Institute, Carlson deconstructs the day’s events with a unique perspective and provocative interviews. Carlson has hosted a number of different nightly news programs on various networks over the past 10 years, including CNN’s Crossfire and several shows on MSNBC and PBS. With his signature wit, Carlson will share with the BOMA audience his take on the divided Congress, the Obama Administration and the 2012 elections. To learn more and register, visit www.boma. com/events/WBM.

Pass the Hand Sanitizer—More of the Germiest Surfaces Revealed

In the office environment, elevator buttons, fridge handles and keyboards rank among the germiest surfaces, but what about outside the office? Kimberly-Clark Professional* recently released findings that show people encounter armies of germs just getting to work. Testing in six major U.S. cities measured for levels of Adenosine Triphosphate to gauge levels of contamination. Surfaces with the highest level of contamination include: gas pump handles (71 percent), mailbox handles (68 percent), escalator rails (43 percent), ATM buttons (41 percent) and parking meters/ kiosks (40 percent). For more information on the study and Kimberly- Clark Professional*’s Healthy Workplace Project, go to www.healthywork placeproject.com.

Washington Leaders Discuss Taxes, Energy Efficiency and FIRPTA at RER Meeting BOMA International Chair Boyd Zoccola and President Henry Chamberlain attended the fall Real Estate Roundtable (RER) meeting on October 11 in Washington, D.C. The meeting featured several high-profile speakers who discussed energy-efficiency incentives, carried interest, foreign investment in real estate, the economy and the 2012 elections. The meeting opened with an outspoken Sen. Ben Nelson (D-Neb.) discussing the debt crisis. He called on Congress to pass spending cuts before any revenue increases. Members from the audience brought up the fact the recent Empire State Building retrofit reduced the building’s energy consumption by 49 percent, yet it did not qualify for any federal subsidies because the performance bar has been set too high. While discussing carried interest concerns, Sen. Ben Cardin (D-Md.) acknowledged that leaving real estate out of the equation would leave too few dollars to meet revenue offset goals. The group was more optimistic about boosting foreign investment in real estate through the Foreign Investment in Real Property Tax Act (FIRPTA).

From left: BOMA Chair Boyd Zoccola, Sen. Ben Cardin and BOMA President Henry Chamberlain.

U.S. General Services Administration (GSA)’s Public Buildings Service Commissioner Bob Peck discussed GSA’s mandate to save the federal government $3 billion by next year through property sales and operational efficiencies. It is focusing on implementing green operating practices and increasing occupancy density in its buildings.

Continued on page 22

The BOMA Magazine November/December 2011

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Around the industry

In Memoriam— Lynn Bellenger Empire State Building Achieves LEED Gold

The Empire State Building has been awarded the U.S. Green Building Council’s LEED® Gold for Existing Buildings, making it the tallest and most well-known building in the United States to receive LEED certification. The 2.85 million-square-foot building is celebrating its 80th anniversary while nearing completion of a $550 million retrofit program. The certification follows the groundbreaking energy-efficient retrofits by the Clinton Climate Initiative, Johnson Controls, Jones Lang LaSalle and the Rocky Mountain Institute. The retrofit is guaranteed to reduce the building’s energy consumption by more than 38 percent and should save $4.4 million in energy costs annually, representing an approximate three-year payback of the cost of implementation. The improvements will also reduce carbon emissions by an estimated 105,000 metric tons over 15 years.

Vacancy Continued to Tick Down in Q3 Grubb & Ellis released its U.S. Office Market First Look for the third quarter of 2011. Despite weak national job reports for Q3, the vacancy rate ended the quarter modestly lower at 17.0 percent, down 30 basis points (bps) from the second quarter. Vacancy rates have declined 70 bps in the last two quarters. Third-quarter absorption totaled 11.8 million square feet, just below the 12.0 million square feet absorbed in Q2. Construction activity picked up slightly, ending Q3 at 22.8 million square feet, up from 19.5 million square feet in Q2. Despite this uptick, space under construction remains very low, and more than half of the new space is located in New York City and Washington, D.C. Rental rates saw little change, with the average Class A asking rate for space at $31.12 per square foot, up 0.2 percent from Q2.

The BOMA Magazine November/December 2011

BOMA International lost a great friend and colleague with the death of Lynn G. Bellenger on Oct. 19, 2011. Bellenger was an engineer and recognized expert in energy conservation and management and a partner with Pathfinder Engineers & Architects LLP, a company she co-founded in 1998. She was a fellow in the American Society of Heating, Refrigerating and Air Conditioning Engineers (ASHRAE) and served as the organization’s first female president of its Board of Directors from June 2010June 2011. Bellenger was a recipient of an ASHRAE Exceptional Service Award, a Distinguished Service Award and two first-place ASHRAE Technology Awards. She earned her Bachelor’s degree in mathematics from Principia College and her Master’s degree in environmental science from Rutgers University. She is survived by her husband; two sisters; and many nieces, nephews and cousins. To honor the remarkable legacy that she leaves, ASHRAE announced the creation of the Lynn G. Bellenger Memorial Fund, which will be used to recognize women in engineering through scholarships or other means. Donations can be made through the ASHRAE website at www.ashrae.org or directly to the Lynn G. Bellenger Memorial Fund, c/o ASHRAE, 1791 Tullie Circle NE, Atlanta, GA 30329.

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Leadership Strategies for Enterprise Leaders Changes in Customer Service, Technology and Job Descriptions Are Elevating the Role of the Traditional PM By Laura Horsley

Today’s property manager is remarkably busy. Keeping pace with the operational implications of constantly changing technology, staying attuned to tenant needs and juggling added responsibilities coming from above are just some of the challenges PMs face. Running a building is a complex and evolving business, and the leadership strategies needed to keep up with it all are evolving as well. The successful PM will need to think strategically to gain an edge and understand that, as the market shifts priorities, so do expectations.

Know your Customers’ Businesses

“The person who was the most successful property manager 20 years ago was probably very successful operationally, but those operations have changed so much over time.” —Marc Fischer, Senior Vice President and Director, Management Services, Transwestern 24

Excelling at customer service might seem like a no-brainer, regardless of market conditions, but successful tenant relations today go well beyond understanding your tenants’ needs; it’s also about understanding their businesses. Chris Lee, real estate futurist and president and chief executive officer of the Los Angeles-based CEL & Associates, Inc., sees this playing out in the shift from an asset-centric industry to a customer-centric industry and views the re-engineering and consolidation within corporate America as pushing this shift. “As corporate America consolidates and accelerates its transition to multi-markets, you really have to be on top of your customer game to capture that growth and transition, not necessarily your asset game,” contends Lee. “It’s important to learn about the growth opportunities with these corporate tenants, and you can’t do that if you’re just watching the building.” Commercial real estate firms that pay attention to what’s going on in the marketplace will have the opportunity to mine for future tenant opportunities as they follow the trends and movement of their current and prospective customers. This knowledge gives them a great tool for staking out new business opportunities, but Lee points out that there are also increasing expectations from tenants that property managers should understand their business so they can facilitate the improvements that might be helpful for their (the tenants’) businesses. “In a challenging marketplace, you cannot neglect a tenant and you cannot afford to not retain a tenant,” says Lee, who believes that integrating the voice of the customer into business operations, taking steps to measure tenant satisfaction and retraining property management and leasing staff to market the “business advantage of a building” vs. the square feet or lease rate of a building are among the critical steps to retaining tenants in today’s market. As the daily contact and relationship manager for tenants, the property manager plays a vital role in this shift from asset focus to customer focus. “The property manager is the problem-solver and facilitates the branding of the buildings,” remarks Lee. “He/she is also critical to the renewal process. If a tenant has been in a building for five or 10 years, [and] if the property manager and building owner have created no

The BOMA Magazine November/December 2011

reason to stay, it may become attractive to leave. Ultimately, the property manager is responsible for tenant satisfaction and retention.” Exactly what does it mean to understand your tenant’s business? Lee gives an example of a law firm in a commercial office building that the PM worked closely with to make sure it had evening and weekend services available while the firm was working on an important class-action lawsuit. When the firm was ultimately successful in its trial, building management hosted a breakfast for them to celebrate that success. This is one example of how understanding your customer’s business can lead to great customer service and, ultimately, a happy customer.

Leverage Technology From the Internet to the smartphone to the “cloud,” the stampede of technology over the past 20 years has led to remarkable advancements and changes to business and industry in a relatively short period of time. Commercial real estate has certainly been a part of this wild ride. The implementation of sophisticated building automation systems and the rise of the mobile, always connected property professional are just two examples of how CRE has evolved. Marc Fischer, senior vice president and director, management services at Transwestern, likes to use the “Gordon Gecko” example from the movie Wall Street: Money Never Sleeps to show just how much technology has changed in the past 20 years. “When Gordon Gecko was released from prison after 20 years, he got back his possessions, one of which was a clunky, archaic cell phone,” explains Fischer. “It was probably cutting-edge at the time, but it’s an anachronism of what has happened over the past 20 years. The person who was the most successful property manager 20 years ago was probably very successful operationally, but those operations have changed so much over time.” For better or for worse, today’s PM is connected 24/7. That expectation of availability from owners, tenants and other stakeholders demands that efficient, smart systems be in place to allow PMs to juggle their responsibilities while meeting, and hopefully exceeding, expectations. Cloud computing, or being able to externally access servers from just about any location or device, is allowing property professionals to work smarter, wherever they are. For many firms, the first step is simply organizing data into one logical file system that everyone can access. Transwestern recently unveiled a tool called “OnePlace,” where all the documents for a building reside. “Every lease, every service agreement, every tenant file resides at OnePlace,” explains Fischer. “When a manager needs a service agreement, he/she goes to OnePlace and picks it up. It becomes very easy to share. It’s portable and efficient because we’re only storing one copy of that lease and not different copies all over the server.” The next step is creating the platform to truly empower the increasingly mobile property professional on a variety of different devices, whether that’s a desktop, laptop, tablet or smartphone. “We have a chief engineer who uses his iPad to dial into the building’s information systems,” says Fischer. “If he’s meeting with a tenant who has a complaint about the office temperature, he can open up his iPad and access the building automation system and show that tenant, graphically, exactly what is happening in that unit.” The next big tool may be a customized dashboard that shows all of a building’s operational data in one place, giving thumbnail sketches of a building’s work ticket and A/R status, energy use, etc.—all in real time. The dashboard might be color-coded to give PMs a status on different systems and programs—green for “good” and red for “attention required,” for instance. “It would provide an amazing increase in efficiency for PMs to use a dashboard to manage their building,” says Fischer, adding, “and the technology could even transfer to the asset manager or portfolio manager so they can very easily keep tabs on the properties in their portfolio, too.” Continued on page 26

“The profession is becoming quite elevated in expectation; often, the PM title really carries the expectation of multiple titles—head of security, sustainability, crisis management, vendor manager, accountant, coach, tenant relationship manager … and the list goes on.” —Chris Lee, Real Estate Futurist and President and Chief Executive Officer, CEL & Associates, Inc.

November/December 2011 The BOMA Magazine

“As corporate America consolidates and accelerates its transition to multi-markets, you really have to be on top of your customer game to capture that growth and transition, not necessarily your asset game.” —Chris Lee, Real Estate Futurist and President and Chief Executive Officer, CEL & Associates, Inc.

Think Like an Enterprise Leader As purse strings have tightened, the responsibilities of the property manager have also broadened. But beyond these fiscal pressures, the role of the PM is changing as building management evolves. Lee believes the title of property manager, in many cases, may no longer be relevant as the needs of the marketplace change. “Business leader or enterprise leader might be more appropriate titles,” explains Lee. “These individuals are managing far more than a building, and eventually the titles will change to recognize that. More and more, they have to have the skillset of an asset manager, the communication skills of a good broker, the relationship skills of a good leader and the analytical skills of a Wall Street trader. The profession is becoming quite elevated in expectation; often, the PM title really carries the expectation of multiple titles—head of security, sustainability, crisis management, vendor manager, accountant, coach, tenant relationship manager … and the list goes on.” Changes in titles and job description are not subject to PMs alone. As buildings become more automated and sophisticated, the role of the building engineer is also

Increased Jobs, Increased Skill Requirements, But What About Compensation? SelectLeaders/Cornell Annual Assessment of the Commercial Real Estate Job Market Hints at New Hiring Trends The BOMA Career Center 2011 update of The SelectLeaders/Cornell Job Barometer Report exhibits a 35 percent increase in job postings per month for 2011 compared to 2010. Property Management jobs, which outdistanced every other business field in 2009 and 2010, slowed a bit in 2011, while opportunities in Asset Management and Brokerage increased (see “Job Postings by Business Field” chart). Dr. David Funk, director of Cornell University Program in Real

35.00% 30.00% 25.00%

Estate (which conducts the study), points out, “Companies have an increased focus on driving operating income, which has led to an increase in property management and portfolio and asset management jobs.” If one goes beyond the job title, many jobs posted as Asset Management included a Property Management function. The Job Barometer has been tracking a trend in the New Economy of employers seeking candidates who can multi-task with multi-sector skillsets.

Job growth has been relative since September 2008. As of September 2011, unemployment remained at 9.1 percent (0.5percent lower than a year earlier), while the underemployment rate— which includes part-time workers who’d prefer a full-time position and people who want work but have given up looking—now is 16.5 percent. According to the October U.S. Bureau of Labor Statistics report, 26 states and the District of Columbia reported unemployment rate increases, 12 states recorded rate decreases and 12 states had no rate change. Unemployment rate for Bachelor’s degree holders was 4.3 percent in August 2011, compared to 5.0 percent in August 2010. Unemployment rate for those with a Master’s degree was 4.0 percent. The decrease in development

Job Postings by Business Field

20.00% 15.00%

The BOMA Magazine November/December 2011

REITs

Property Management

Investments (asset management)

Government/Non-‐Proﬁt Organiza5on

2010 Finance

0.00% Development

2009 Consul5ng/Advisory/Third Party Service Provider

2008

5.00% Brokerage

10.00%

2011

evolving. Fischer wonders if a mechanical engineering degree may eventually be a requirement for some building engineers and if Information Technology (IT) professionals will be part of the building management team. “If the backbone of a building becomes Internet-based with building automation systems that run through the Internet, we may need additional staffers on the PM team with that technology component,” says Fischer. “It’s entirely possible that you’re going to see people in this business who have never been the classic ‘wrench-turner’ engineer and they have an advanced degree in IT or mechanical engineering.” Perhaps the best way to help today’s property professional attain the skills to be an effective “enterprise leader” or “business leader” is to properly set the stage for the modern era of property management. Notes Lee, “If we’re trying to make the industry attractive to people and show them that it’s not just about managing a building, but it’s also about being a business leader, we need to focus more on enterprise and business leadership and less on process and procedure.”

has caused a decrease in constructionrelated jobs, which is reflected in the disparity in opportunities depending upon education levels. Where are the Job Seekers applying? Asset management topped the charts in 2011, 2010 and 2009. It is interesting to note that Investment Banking went from third place on the most-applied job categories in 2008 to 16th place in 2011—it appears that they went into Asset Management. Geographically, the top most-applied to states remain New York, California, Texas and Florida. It is interesting that Washington, D.C. made the list for the first time in 2010. SelectLeaders/Cornell Skillset Requirements (September 2011 vs. September 2005): • 12.5 percent of the job postings on SelectLeaders Real Estate Job Network in September 2011 required quantitative experience compared to 7.4

$150,000 $140,000

percent of job postings in September 2005. • Approximately 21 percent of the jobs posted in September 2011 required Argus experience, which is comparable to nearly 0 percent in September 2005. More employers are not only requiring increased skills, but asking for scores, such as GMAT and grade point average of applicants, in this increasingly competitive job market. Compensation Industry-Wide? The decrease in compensation from 2009 to 2010 for Property Managers of properties less than one million square feet was 20.9 percent, compared to Acquisitions Associates (Office/Industrial) decreasing 14.1 percent, Portfolio Managers (Office/Industrial) 11.6 percent and Project Managers (Residential) down 6.9 percent (see “Compensation 20042010” chart) between 2009 and 2010.

“It’s entirely possible that you’re going to see people in this business who have never been the classic ‘wrench-turner’ engineer and they have an advanced degree in IT or mechanical engineering.” —Marc Fischer, Senior Vice President and Director, Management Services, Transwestern

In many cases, bonuses are compensating for any reductions in salary. Today, however, bonuses are not just tied to personal performance, but to company performance as well. The 2011 BOMA Career Center Job Barometer Update is more optimistic than in the past two years; new hiring trends appear to be emerging. We will continue to assess how this new hiring paradigm could affect our industry.

About This Report: The SelectLeaders/ Cornell Job Barometer Report—An Assessment of the Job Market in Commercial Real Estate is written and published by Dr. David Funk, director, Cornell University Program in Real Estate. Special thanks to his Cornell Graduate School team: Shawn Duggal, CJ Kodani and Patrick Nessenthaler. BOMA Career Center excerpt by Susan Phillips-LoPinto, CEO, SelectLeaders Real Estate Job Network.

Compensation 2004–2010

$130,000 Project Manager (Residen>al)

$120,000

Acquisi>ons Associate (Oﬃce/Industrial)

$110,000

PorHolio Manager (Oﬃce/Industrial)

$100,000

Property Manger (>1m s.f.) (Oﬃce/Industrial)

$90,000 $80,000 2004

2005

2006

2007

2009

2010

November/December 2011 The BOMA Magazine

technicians and engineers can recommend cost-effective sustainable products and practices that help achieve reductions in material use, energy and waste. The following sustainable solutions can be implemented to increase energy efficiency, reduce toxins, eliminate unnecessary waste and extend the life cycle of your elevator.

Sustainable Solutions for Traction Elevators Upgrading the Motor

Exploring Sustainable Service Solutions for Elevators By Sasha Bailey, LEED AP BD+C With a continually increasing emphasis on green-building practices globally, many building owners, facility managers, engineers and architects are seeking ways to reduce the environmental impact of existing elevators by exploring innovative sustainable service solutions. Among the environmental challenges they are encountering are energy efficiency, indoor air quality and oil requirements. In response, experienced

Upgrading from a motor-generator (MG) drive to a variable-voltage variable frequency (VVVF) drive could save approximately 40 percent on energy consumption, depending on the elevator type and size. Because of required power conversion, MG sets require one motor to run solely as a generator to power another hoisting motor. More current technology, like VVVF drives, has eliminated the need for this unnecessary redundancy, thus greatly reducing the amount of energy needed to power elevators. Moving away from the old MG sets also eliminates potential indoor air quality issues associated with carbon dust created by the use of carbon brushes in the motors themselves and waste heat.

Regenerative Drives Building owners can implement technical advances, like installing regenerative drives, which revert some of the elevator’s unused energy back into the building. The power that is transferred back into the building would traditionally be dissipated via heat into the machine room. With the regenerative drive, the excess energy is captured and reused, and the system reduces costly traditional cooling of the elevator machine room. Building owners, facility managers, elevator consultants and architects can utilize energy calculators to help customers identify estimates of energy savings from regenerative options.

The BOMA Magazine November/December 2011

Destination Control Software Installing destination control software can create more efficient passenger transportation, ultimately improving building efficiency—not to mention the “cool” factor—which can increase the building’s overall property value. Destination control software improves routing by grouping elevators by the floor the passengers intend to travel to in a building. Buttons are not required inside each elevator car because passengers designate which floor they are traveling to using a centralized screen input system in the building’s lobby. The touch screen directs passengers to their designated elevator as determined by a formula that considers requested destinations and estimated time to destination. Riders are evenly dispersed to their appropriate elevators. The destination control software groups all passengers traveling to the same floor in the same cab, reducing the number of stops and improving the elevator’s efficiency. This practice can increase handling capacity up to 30 percent. Systems equipped with destination control software also allow building owners to accommodate tenants with high-traffic needs during peak travel times of the day.

Sustainable Solutions for Hydraulic Elevators Readily Biodegradable Oil Recently developed canola-based hydraulic oil represents the most environmentally preferable hydraulic option available today. It differs from traditional soy-based hydraulic oils, which are typically 50 percent vegetable-based with synthetics added to compensate for deficiencies. It has a more stable viscosity throughout its heat range, requiring less valve adjustments in extreme temperatures, and may eliminate the need for a viscosity control device that requires energy in order to keep the oil fluid and avoid thickening. Traditionally, a viscosity control device is required to keep an elevator’s oil at its

optimum operating temperature around the clock, even when the elevator is not in use. Eliminating the need for this device reduces the amount of electricity a building’s elevator is consuming. And, by replacing existing petroleumbased oil with this product, you can rejuvenate your system’s lubricity, which will allow you to maintain your elevator at peak operating performance and make the system more environmentally preferable.

Power Units and Valves Another improvement in hydraulic elevator technology can be achieved through the updating of power units. Normal wear and tear on older pump units means seals can begin to leak or valves might not seal tightly, permitting system pressure to decrease over time. Decreased pressure requires the unit to unnecessarily power-up in order to relevel even in off-peak hours. Constant leveling throughout a unit’s downtime can mean unnecessary use of electricity for the building owner and more wear and tear on the seals and pump parts.

Sustainable Solutions for All Elevator Types LED Lighting Installing light-emitting diodes (LEDs) can reduce energy costs by up to 80 percent, as well as dramatically cut down on the number of bulbs that owners need to replace each year. Typically, LED lights last up to 10 years. The choice to move to LED can reduce heat loss typical in other lighting options and disposal issues common with other mercury-containing bulbs. It also increases the life span, in some cases up to 10 years per light. Finally, LEDs do not emit the ultraviolet light that is common in other bulbs, which can cause fading to elevator cab interiors over time.

Econolight™ Based on life cycle analysis, it is common knowledge that an elevator’s largest environmental footprint comes from the energy used during its use phase and

most of that phase is spent sitting idle. Programming the elevator controller to shut off the elevator’s lights and fan when the cab meets certain parameters will increase energy savings. Econolight is a sustainable solution that eliminates approximately 60 percent of wasted energy in an idle elevator. For instance, if the elevator is stopped on the lobby floor and has not been used within a certain time frame, the elevator system would be programmed to shut off the cab’s lights and fans. With Econolight, energy use could go from 24 hours a day to less than 9.5 hours a day, reducing CO2 emissions by 193,000 tons per year. Features and benefits include: • Easy and quick installation (less than two hours). • Conserves energy. • Increases the value of the elevator and building. • Saves money due to fewer bulb replacements. • Five-year-or-less-payback period in energy savings. • Cabs are cooler when lighting has been off between service calls.

Solid-State Starters A solid-state starter supplies a motor with smooth and steady current, eliminating the large influx of current typically created by older mechanical starters. Conventional motors, when energized, create power surges (“spikes”). These spikes may be noticed by momentary dimming of the lights in the cab and may hamper optimal performance of sensitive equipment, such as computer equipment. This sustainable solution also provides savings because the starters reduce spikes, which utility companies may bill at higher rates. Features and benefits include: • No starter contacts used during normal operation. • Less severe starting. • No light flicker or spikes that can interfere with a building’s equipment. • Reduced stress on the motor windings. • Prolonged motor life. • Quieter operation.

Battery Lowering Battery lowering ensures that, in the case of an emergency, all elevators are lowered to the nearest point of egress, thereby avoiding entrapments. Battery lowering also reduces the demand on a building’s backup generator, permitting reduced energy demand in an emergency. This can reduce the need to include elevator systems while sizing the building’s backup generator and represents an efficient use of resources.

Conclusion The largest impact the industry can have on energy reduction is through the modernization of outdated and energyinefficient technology, one building at a time. According to the U.S. Green Building Council, buildings are using approximately 71 percent of all electricity in the United States, making finding means to reduce this usage paramount to sustained operations. Because older elevators consume up to two to three percent of all electricity globally, it has become increasingly important for companies to provide best-in-class sustainable solutions that reduce customers’ environmental impacts and operating costs. Recent reports indicate that there are opportunities for energy and emissions reductions in drives, lighting and fans, with potential energy savings ranging from 50 to 94 percent for each element. It is estimated that regenerative drives, in particular, reduce 3,800 pounds of greenhouse gas emissions per year per elevator. The reduction can be substantial for customers who are measuring, documenting and reporting the CO2 footprint of their building portfolio. In short, by choosing sustainable service solutions, building owners benefit both building occupants and the environment. About the Author: Sasha Bailey, LEED AP BD+C is a corporate sustainability manager in ThyssenKrupp Elevators Americas’ Business Unit. She can be contacted via e-mail at Sasha.Bailey@ thyssenkrupp.com. Learn more about ThyssenKrupp’s sustainable design solutions for elevators at www.thyssen kruppelevator.com/su stain.asp.

November/December 2011 The BOMA Magazine

What’s All the Fuss About Lease Accounting?

Global Change Is On the Horizon By Serena Wolfe and Josh Herrenkohl Businesses around the world are bracing for the biggest accounting change to hit commercial leases since 1975. The new guidelines, currently being drawn up by the Financial Accounting Standards Board (FASB) and its global counterpart, the International Accounting Standards Board (IASB), will affect companies that lease everything from real estate to photocopy machines. The new guidelines have triggered considerable nail-biting among companies, particularly those in the retail sector, that wonder exactly how much time, money and additional staff will be needed to meet them. While the new rules are not expected to be formally announced until early 2012 and likely will not take effect until 2015 or later, companies would be wise to start preparing for them sooner rather than later. Those who procrastinate will be in for a rude awakening—the operational implications for many companies will be substantial, requiring significant system and process changes.

The Balance Sheet The proposed changes will replace Accounting Standards Codification 820 (formerly known as Statement of Financial Account Standards No. 13 [FAS13]), the “right of use” law that has governed the treatment of leases from an accounting perspective since 1975. Under FAS 13, companies that lease real estate or equipment may be able to report the lease obligation off-balance sheet, which means the lease payments are treated as an operating expense on the income statement. As an example, a company may opt to sell a real estate property and then lease it back from the buyer through a sale-leaseback agreement. If structured as a keep operating lease, this strategy allows the company to move the real estate off its balance sheet, lower its debt ratio and use the proceeds from the sale to finance its business or pay down debt without additional lease liabilities. There are some restrictions: The off-balance sheet option does not apply if a company’s combined lease rental payments exceed 90 percent of the current market value of the real estate or equipment or if the length of the lease exceeds 75 percent of the “useful life of the asset.” But over the years, many companies have found ways to structure around the restrictions, which FASB felt understated their financial obligation on a company’s balance sheet. FASB’s proposed new rule requires all leases to be reported on the balance sheet (the only exception is short-term leases

The BOMA Magazine November/December 2011

of 12 months or less). This means that companies that lease commercial space, for example, would have to report the lease as both an asset and a liability on their books. This, in turn, could potentially affect the company’s reported net income, loan covenants and credit ratings, among other things, since the lease payments would be considered outstanding liabilities owed to the lessor. Publicly traded companies in the United States would have to bring $1.3 trillion in leases onto their balance sheets under this new rule, according to estimates by the U.S. Securities and Exchange Commission. When private companies who follow U.S. GAAP accounting are considered, the off-balance sheet liability is even higher, reaching $2 trillion. Retailers will be hit the hardest: Those in the S&P 500 currently have off-balance sheet lease liabilities of at least $549 billion, estimates Credit Suisse. The proposed new rules also bring potential headaches, as companies will be required to collate additional data and lease details. Instead of using traditional straight-line accounting, where rental payments are averaged out over the life of the lease to calculate the annual lease payment expense, the new rule requires far more complicated calculations that will change the expense recognized by a company. The rule requires the company to forecast the payments for the entire life of the lease and then recognize the interest expense on those payments as if the asset had been purchased rather than leased from day one. Essentially, the Boards view a lease as a financing transaction rather than an operating expense. The expense will be recorded as amortization expense and interest, and front-loaded, as interest expense will be much higher in the beginning than in later years.

The new rule requires far more complicated calculations that will change the expense recognized by a company.

credit rating, ability to borrow money or even meet the credit level needed to renew a lease. On the technology side, the new rule will add significant assets and liabilities to the balance sheet and require periodic reassessments of every lease in every country, which basic computer programs and spreadsheets likely cannot handle. Companies will have to go through all of their leases, put them through some sort of spreadsheet or model to forecast out cash flows and figure out the borrowing rate to apply. As a result, many companies may have to implement costly new IT systems and add additional staff to handle the new requirements. While larger companies likely have the resources to get through this, small and middle-market companies may struggle.

Preparing Early

Effects on Leasing

There will be a significant need for additional personnel leading up to the rule changes, as many companies will need to locate existing leases and abstract relevant, but in many cases missing, data required to perform the calculations. In addition, companies will need to make changes to their business processes and technology to capture data from future leases. Most major vendors of IT systems, including financial systems and corporate real estate systems, are beginning to identify the requirements for the necessary changes but will not be able to make the necessary changes to their products until the rules are finalized. That means there will be a very high level of dependency on a very small pool of knowledgeable resources to assist companies with these changes. The companies that prepare early are the ones that will be least likely to suffer significant business disruptions as the implementation date draws near. In addition, assuming the new rules become effective in 2015, public companies will have to provide comparable data for a three-year period. That requires companies to restate their financial statements for 2013 and 2014 to show how the accounting change would have affected those years so that analysts will have an apples-to-apples comparison. The proposed accounting change could also create sticker shock for analysts and investors covering a particular company who suddenly see a sharp rise in a company’s expenses and a potential (depending on the composition of a company’s leases) drop off in earnings per share. If companies don’t do their homework early, prepare highly detailed supplemental data and give investors and analysts a heads-up on the accounting change and its expected impact on profits, it could spell disaster. Indeed, it could be a slippery slope for the ill-prepared: The on-balance sheet liability could affect a company’s ability to meet loan ratio or other income metrics requirements in financial covenants which, in turn, could affect the firm’s

Could the accounting change cause a surge in companies opting to own, rather than lease, real estate? Perhaps, however, the current proposed change is far more reasonable than the original plan, which would have required companies to calculate lease payments through optional lease extension periods. The backlash to the original plan was swift and angry, causing FASB to amend the proposed rule to reduce the likely lease term to something many are familiar with today. As many have prophesized, the number of sale-leasebacks and triple-net lease tenants could decline under the new proposed rule; however, most companies will probably still lease rather than own real estate, even if it requires additional paperwork and complying with new rules. Some larger companies, with good access to capital and a lease/own mix, might be inclined to buy more assets in the future instead of leasing, but the majority of companies may be reluctant to take on the challenges of buying and managing real estate. The new rules will have far-reaching ramifications that will affect every company in the world that has a lease. FASB has been working with IASB to draw up universal standards that will affect companies and leases around the world. Although the change has been under consideration since 2002, efforts escalated during the economic meltdown in 2008 when investors began demanding greater transparency and disclosure in corporate financial statements. A universal standard is expected to be issued early next year. About the Authors: Serena Wolfe is a partner with Ernst & Young LLP’s real estate practice. She can be reached at serena. wolfe@ey.com. Josh Herrenkohl is a senior manager with Ernst & Young LLP’s real estate practice. He can be reached at josh. herrenkohl@ey.com. The views expressed herein are those of the authors and do not necessarily reflect the views of Ernst & Young LLP.

November/December 2011 The BOMA Magazine

Top 10 Ways the ADA Standards Will Impact Buildings New BOMA Guidebook Helps Property Professionals Comply

By Lindsay Tiffany The first major update to the Americans with Disabilities Act (ADA) was finalized last year, making the new regulations the first comprehensive revision to federal accessibility standards since the initial ADA standards were issued in 1991. The 2010 ADA Standards will become mandatory in March 2012, affecting alterations, renovations, tenant improvements and new construction in commercial buildings. While the Department of Justice’s (DOJ’s) revised rules include a broad “grandfather” clause that exempts all building elements constructed or altered in compliance with the 1991 regulations, when those elements are subject to a planned alteration they must comply with the new 2010 regulations. To help industry professionals understand and implement the new requirements of the 2010 Standards, BOMA has released a new publication, Guide to the 2010 ADA Standards. The guidebook includes information on updated requirements for accessible routes and a variety of building elements, as well as new policies and practices impacting service animals, mobility devices and communication services. BOMA played an active role in representing the commercial real estate industry throughout the new ADA standards development process. “BOMA is committed to helping our members make their buildings accessible. Since the first standards were issued in 1991, we have actively participated in the standards development process and produced a host of resources to help property professionals with compliance,” comments BOMA International’s Vice President of Codes, Standards and Regulatory Affairs Ron Burton, who led

10 Building Elements that will be Affected by the New ADA Standards Front and side reach ranges. The new standards set limits on counter heights and the placement of other elements, such as faucets, towel bars, soap dispensers, water fountains, shelves, coat hooks and more.

Employee work spaces. The new requirements increase the accessible common use circulation paths in cubicles and other employee work areas.

Restrooms. Enlarged turning spaces and clearances for wheelchair access are now mandatory.

Wheelchairs. Wheelchairs must be permitted in all areas open to pedestrian use. Increased wheelchair turning spaces and clearances are also required in specific areas, such as restrooms and work spaces.

Power-driven mobility devices. The new standards include modifications defining wheelchair and other powerdriven mobility aids. Devices like Segway® PT must be permitted in most cases.

Accessible routes. Accessible routes must be located in the same areas as exterior and interior general circulation paths.

Parking garages. All pedestrian direct connections to another facility or building must be accessible. Additional van-accessible spaces are required.

Communication services. Video remote interpreting (VRI) and other auxiliary aids may be implemented to provide effective communication.

Service animals. The new standards require expanded coverage for individuals using dogs for specific tasks.

Recreational areas. Fitness centers, exercise rooms, spas, saunas and swimming pools are required to have accessible routes, clear floor space for wheelchair access to equipment and facilities. Accessible pool entries and exits are also now required.

The BOMA Magazine November/December 2011

BOMA Inte rnAtIOnAl

Guide to the 2010 ADA Standards Lawrence G. Perry, AIA

Along with several industry coalition partners, BOMA helped facilitate a less complicated and more cost-effective transition to the new rules.

BOMA’s efforts in the development of the new guidebook. “BOMA’s participation in the standards development process over the last 20 years has positioned us as leaders in the accessibility arena,” adds BOMA International Chair Boyd R. Zoccola, executive vice president, Hokanson Companies Inc. “This new guidebook is an unmatched resource for understanding the new rules and implementing them correctly.” Along with several industry coalition partners, BOMA helped facilitate a less complicated and more cost-effective transition to the new rules, with notable success on two fronts. The first was the inclusion of the “grandfather” clause that exempts all building elements that were constructed or altered in compliance with the 1991 rules. This grandfather exemption is in effect until those elements are subject to a planned alteration and also applies to the “path of travel” to an altered area. The second is the inclusion of a reasonable timeline within which to comply with the new rules. Over the last decade, BOMA has had extensive input in key accessibility forums, including the ANSI A117 Accessibility Standard Committee and the ADA Accessibility Guidelines Review Advisory Committee. Both committees have worked to set a foundation for consistency between accessibility requirements of federal law, model codes and state and local regulations. The new

guidebook is a complete update to BOMA’s 1991 publication ADA Compliance Guidebook: A Checklist for Your Building, one of several publications BOMA issued after the publication of the 1991 standard.

Compliance Deadline

After March 15, 2012, new construction, alterations and tenant improvements are required to comply with the 2010 ADA Standards. Act now to ensure you are ADA compliant. For more information or to order BOMA’s Guide to the 2010 ADA Standards, visit http://shop. boma.org.

November/December 2011 The BOMA Magazine

trends tracker

BOMA Canada’s BOMEX 2011: It All Starts Here By Henry Chamberlain, APR, FASAE, CAE St. John’s, Newfoundland, is full of firsts: It was the first colony in North America, witnessed the first transatlantic cable and was the site of the first transatlantic flight. Being the Musson Rubber - BOMA.qxp

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eastern most part of North America, it is also the first place the sun rises. BOMA International Chair Boyd Zoccola and President Henry Chamberlain attended this year’s BOMA Canada National Conference and Exposition (BOMEX) in St. John’s, Newfoundland, 10:34 AM Page 1

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The BOMA Magazine November/December 2011

September 25-27. Held in a venue on the harbor, the meeting attracted approximately 300 delegates and 45 tradeshow exhibitors. An additional 100 participants attended the closing TOBY® Awards gala, which had 31 building entries. The gala was emceed by local comedian and personality Sheila Williams, who was also a featured entertainer at the pub crawl social. The education program, sponsored by BOMI Canada, featured five or six sessions per time segment over two days. There were excellent programs on sustainability, leadership, management best practices and more presented by representatives from some BOMA International partners, including Trane. The keynote speakers were retired Canadian Forces General Rick Hillier and environmental sustainability expert and venture capitalist Dr. Tom Rand. In more than three decades of service to his country, Hillier remobilized support of Canadian troops, worked closely with prime ministers, increased Canada’s significance within NATO and solidified Canada’s reputation on the world stage. His keynote speech focused on leadership during difficult times. Rand is founder and director of VCi Green Funds, a seed and venture capital fund in the low-carbon sector, and is also lead advisor at Cleantech, which helps Canadian clean-tech companies grow to global leadership. He recently published Kick the Fossil Fuel Habit: 10 Clean Technologies to Save Our World. In his keynote address, he spoke about the importance of renewable energy, weighing the advantages of different

sources, and urged significant capital investments in clean energy systems. He argued that only through a global, longterm approach can renewable energy The Building Owners and Managers Association (BOMA) of Canada is the voice truly become reliable enough to eradiof the Canadian commercial real estate industry, with more than 3,200 memcate the use of fossil fuels. bers in regional associations across Canada. On behalf of the building owners, Rand encouraged the commercial real estate industry to rethink its reliance on managers, developers, facilities managers, asset managers, leasing agents, brokers oil, gas, coal and nuclear power and disand the product and service providers to more than two billion square feet of cussed business models that could yield commercial real estate in Canada, BOMA Canada addresses issues of national significant return on investment while concern and promotes excellence in the industry through information, educaweaning the industry off unsustainable tion, advocacy and recognition. For more information on BOMA Canada, visit sources of energy. As an example, he www.bomacanada.ca. spoke about The Planet Traveler, a project in downtown Toronto that claims to be the greenest hotel in North America, which Rand co-developed. The hotel Wakefield, Humford Management and was hosted by BOMA Canada’s officers, runs on geothermal energy and has 75 SNC Lavalin, moderated by Steve Wilwho include: Chair Wendy Cardell, direcpercent fewer carbon emissions than liams of Real Capital Analytics. The panel tor-at-large, Cadillac Fairview Corporait would running on non-renewable concluded that, while the economy in tion Ltd.; Chair-Elect David Judge, direcsources. The building was retrofitted Canada is faring much better than in the tor-at-large, Humford Management; Vice using five percent of the building’s capUnited States, especially when measured Chair Peter MacHardy, director-at-large, ital and has yielded significant payback. by new construction and absorption, GWL Realty Advisors; Secretary-TreaZoccola served as the U.S. representafear over economic uncertainty in the surer Sonia Trudel, CA, MCR; and Presitive on an executive roundtable general United States and Europe persists. dent Diana Osler Zortea. session with Canadian representatives The BOMA International delegation from Jones Lang LaSalle, Cushman & garvin-Buildings-Ad 10/6/11 3:28 PM Page 1

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November/December 2011 The BOMA Magazine

green scene

‘Green’ Paper Meets the Fiber Age By Don Totten

We all want to choose products that help the environment. But sustainable purchasing isn’t as simple as a recycling or certification logo anymore. The longer we’re at it, the more we learn that our vision of sustainability needs to adapt and grow with new innovations. To really help the environment when you buy a paper product, ask about its fiber age. Paper with a young fiber age is made with environmentally friendly, younger trees instead of using our planet’s valuable, old-growth forests.

Recycling: Helpful, But Not Quite Innovative In the 1990s, recycling became popular. In fact, if you wanted to help the environment in those days, using paper, tissue and towels made from recycled paper was usually your only option. Because of this, the easiest way to measure “green-ness” was through a product’s percentage of recycled content. By today’s standards, the process of recycling is a very energy-intensive way to “go green.” For example, when paper is recycled in the United States, about a third of it is sent to China, usually to become boxes for toys and other consumer products. The paper needs to be picked up by the disposal company, processed and cut, bundled for shipping, delivered to port, taken by ship to China, taken by train to a paper mill, treated with chemicals to de-ink, reshaped into a new product and returned through the same routes back to the United States to be used all over again. That is a lot of work—and energy—for something that claims to be good for the environment. This is particularly cumbersome given that, even with new recycling

technology, people often still prefer to use paper products that aren’t made from recycled paper.

Green Begins Before Recycling New innovations have zipped by the outdated recycled-content standard. Land-use and sustainability science has revolutionized the paper industry. Tree farmers around the world are proving to be ingenious sustainability innovators, whose models for success fit outside of this outdated measurement. The old recycled-content standard especially ignores tree farmers in equatorial climates, who can take advantage of naturally faster re-growth rates to create environmentally sound paper products. Modern tree plantations, particularly along the equator, are redefining our notion of “green.” Through these plantations, we find that paper can be sustainable without recycling, when it’s made with fibers from “rapidly renewable” trees. Rapidly renewable trees are trees that grow so fast that they can reach full height quickly—more like crops than our image of slow-growing forests. These trees can grow to maturity in as little as six years.

The Young Tree Advantage These new, young trees are grown on plantations that are fully compliant with national laws. In fact, many go beyond the laws to sustainability that is internationally certified from seed to paper. Neutral, third-party organizations, such as the Programme for the Endorsement of Forest Certification (PEFC), the world’s largest forest certification organization,

The BOMA Magazine November/December 2011

monitor the paper-making process at these plantations to verify that they promote sustainable forest management. Equally important to the environment, these fast-growing trees leave no “holes” in the forest like they do in our colder northern climate. Trees are organized to grow and be harvested in ways that maintain the landscape and keep a constant and established environment for the local animals. In contrast, most recycled paper in the United States originally came from old-growth forests. Old-growth forests are full of trees that have been around for decades or even centuries. They absorb tons of greenhouse gasses over the years and are home to more plant and animal species.

Welcome to the Fiber Age To be serious about protecting these valuable old-growth trees, saving energy in paper production and shopping “green,” ask for paper and tissue products with a “young” fiber age. When a paper product has a “young” fiber age, it means that the base paper was made using a higher concentration of rapidly renewable trees. Paper products with “older” fiber age use more precious, slower-growth forests in production. All over the world, innovators in sustainability science are finding new ways to deliver the “green-ness” that we’re all looking for. By keeping up-to-date with them, we can buy paper products that truly help the environment. About the Author: Don Totten is vice president of marketing for Oasis Brands’ Away-from-Home business. With more than 20 years of experience in the tissue industry, Totten specializes in innovation that reduces waste and improves sustainability. Many Oasis Brands’ tissue and towel product families are made with rapidly renewable fiber. For more information, visit www.oasisbrands. com.

SUPPLIER Showcase

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Ornamental Fencing From Ameristar Fence Products, Inc. Ameristar’s Montage Plus® ornamental fencing, the first choice among contractors for providing owners with a decorative fence that balances strength, aesthetics and cost. Montage Plus provides consumers with a maintenance-free solution that’s matched with a rigid steel construction for strength and durability. Phone: 866-702-3192; e-mail: busdev@ameristarfence.com; www.AmeristarFence.com.

Aquatherm: The Right Pipe For Your Building! With a better material, leak-free connections and a 10-year warranty that even covers incidentals, what’s not to love? Switch to Aquatherm’s heat-fused polypropylene and learn why Aquatherm is the fastest-growing pressure piping system in North America! www.aquathermpipe.com, or contact Charlie Clark, Inside Sales Manager, at Charlie. clark@aquathermpipe.com or 801-805-6657.

BAC Factory-Authorized Parts at Cooling Tower World Cooling Tower World is the only place to purchase BAC Factory Authorized Parts online. BAC’s parts are manufactured to meet rigorous cooling tower duty specifications and are guaranteed to fit your unit and perform as original equipment. Cooling Tower World offers Free 2-Day Shipping on all orders placed, and all parts carry a full 1-year warranty backed by BAC. For more information, visit www.CoolingTowerWorld.com.

CSW Screw Compressors From BITZER BITZER CSW Screw Compressors are optimized for low-condensing temperature applications, making these models ideal when replacing old, inefficient Screw or Recip models in watercooled chillers or air-cooled systems operating under moderate climate conditions. With market-leading energy efficiency, particularly under part load operation, CSWs provide equivalent EERs to complex oil-less, centrifugal models, but at a much more competitive price. Approved for R134a, R22 or R407C. BITZER U.S., Inc. Phone: 770-503-9226. E-mail: sales@bitzerus.com; techsupport@bitzerus.com; customerservice@bitzerus.com.

Clean and Polish Offers Specialty Maintenance Services Exterior Building Maintenance and Specialty Service Provider: 1-800-811-4989; www.cleanandpolish. com. Providing commercial window cleaning, pressure washing, “green” garage/parking lot cleaning, metal, glass, wood and stone restoration/maintenance, bird/spider control systems, canopy/awning cleaning, caulking, masonry and concrete repairs, painting and much more!

Cleaner, Healthier Environments With Cleaning Services Group As a national leader in the industry with over 25 years of experience, CSG will provide your business with customized programs to fit your janitorial needs AND help you maintain a cleaner, healthier environment for your customers and employees. More information on Cleaning Services Group, Inc. at www.cleaningservicesgroup.com. Phone: 800-683-6572; Fax: 800-789-5440.

‘Shield Your Budget From Costly Compromise’ Through Coast to Coast Direct Painting Products One word that just doesn’t fit in the professional workplace: compromise. A professional doesn’t compromise quality or value for speed. Now there’s an easy-to-use paint roller tool that delivers quality, speed and value, the patented Paint Shield system. This tool produces the cut-in quality of a seasoned professional painter, while reducing the time from start to clean by up to 50 percent. Less time, less cost, more savings. It’s the only no-compromise approach to profit and value. Coast to Coast Direct: 714-904-8320; mike@coast-coastdirect.com; www.coast coastdirect.com.

November/December 2011 The BOMA Magazine

SUPPLIER Showcase

Of Products & Services

Special Advertising Section

Continental Control Systems’ Accu-CT—Current Transformer For Revenue Grade AC Energy Measurements Continental Control Systems announces the release of the Accu-CT™ the high-accuracy, revenue grade current transformer for use with any WattNode® Energy meter. The Accu-CT and WattNode comply with the ARRA (American Recovery and Reinvestment Act) and will provide for ANSI C12.1 accuracy requirements for the California Solar Initiative and for ANSI C12.20 for tenant submetering and billing. For more information, call 1-888-928-8663 or visit www.ccontrolsys.com.

‘Breathing Life Back Into Your Building’ With Dadanco Just because you have an existing 30-year-old perimeter induction system, doesn’t mean you can’t go “Green” and increase tenant comfort while reducing energy and running costs. DADANCO replacement induction units with patented nozzle technology provide very high air entrainment ratios at low operating static pressures. Call 413564-5775; or visit www.dadanco.com.

Electronic Building Directories From Directory Solutions, Inc. 25-year leader in electronic and touch screen building directories. Unlimited listings that can be updated in seconds from your office. Wide variety of features and directory styles. Visit www.TouchSource.com or call 800-704-3458.

Disaster Planning From DKI DKI Commercial Solutions’ unparalleled ability to assist companies with disaster planning, as well as handling any size property loss with one simple call, has alleviated much of the responsibility for risk managers and property managers. For more information, please visit www.dkics.com.

Twin-Man, Mobile, Fall-Arrest Cart From Garlock Safety Systems The COBRA LIFELINK™ Twin-Man cart is a mobile anchorage system 2 workers can tie-off on when they’re exposed to a fall-from-height hazard. Cart simultaneously provides fall arrest for 1 person and fall restraint for a 2nd. Contractors and maintenance personnel will appreciate the cart’s simplicity and how easy it is to roll around the jobsite. If a fall arrest occurs, a claw located under the unit penetrates the substrate and holds the cart and worker secure. Compact design fits easily into elevators, pickup trucks and through doorways. No anchorage to the substrate is required. Call Garlock Safety Systems 763-694-2614 or visit www.railguard.net/cobra-cart.asp.

Asphalt Preservation From Gee Asphalt Systems, Inc. Asphalt Preservation is about taking care of your good pavements while they are still good. We’ll show you how to preserve your asphalt pavements for a fraction of the cost to replace them. Serving clients Nationwide. For more information, contact us at 800-747-8567 or log on to www.geeasphalt.net. “The Asphalt Preservation Specialists”

General Elevator Parts Inc.—We Buy & Sell Single Source Supplier: 1-800-848-3329 or 773-491-1927; Fax: 1-800-578-6349 or 773-463-2827. Otis, Westinghouse, Dover, Imperial, etc. Surplus Motors and Generators: Rotors—IMO Pumps; Armatures—Door Motors; Machine Parts—Controls; ✓ Obsolete’s Largest Supply. GeGeLu@comcast.net: Networking your inventory is like fishing. Just send over your list and we will hook you up! Otis turtleback longneck and shortneck hoist motors size 1 1/2, 2 1/2, 3 1/2, 4 1/2, 5 1/2, etc. Otis wound rotors type 1ac, 2ac, 3ac, 5ac, 7 1/2ac, etc. Otis 63g, and all other dc hoist motors leg mount and flange mount. Westinghouse dc flange mount 63a, 93 and 93.5 frame. See the website at elevatorexchange.com.

The BOMA Magazine November/December 2011

Special Advertising Section

Rigging, Safety and Training From Hamilton Blake Safety Unique Solutions for Rigging, Safety, and Training … we offer hands-on training for window cleaners and specialized technology, such as the 121 Ft. Omme Lift for rent or purchase. Call Us Today—702-307-4477; www.hamiltonblakesafety.com.

Corrosion Protection For Dry Fire Sprinkler Systems From Huguenot Laboratories! MICBlast Nitrogen generation technology replaces your existing air compressor with corrosion inhibiting, high purity Nitrogen (N2) for your Fire Protection Systems. Call Huguenot Labs for details 800-228-3793. www.huguenotlabs.com.

UL Listed Elevator Key Box From Knox Company Store elevator drop keys and other emergency keys in the high-security Knox Elevator Key Box. • UL Listed meeting 2012 International Fire Code • Low profile design complements most lobby decors • Available in 2 sizes in four colors Phone Knox Company at 800-552-5669 or e-mail info@knoxbox.com.

PAR-Style Lamps From LEDtronics Continuing to add to its line of innovative and energy-efficient LED replacements for incandescent and halogen light bulbs, LEDtronics® announces its new series of PAR-style high-power, high-efficacy lamps with highest-grade LEDs and Fresnel lens. Phone: 800-579-4875; Web: www.ledtronics.com.

Elevator, Escalator and Exterior Maintenance Expertise From Lerch Bates Lerch Bates consults on all facets of design, maintenance and sustainability. We assess, advise and recommend strategies for designing, maintaining and inspecting elevator and escalator systems, managing and handling materials throughout the building, along with accessing and maintaining the exterior or façade. www.lerchbates.com. Phone 303-795-7956.

‘Green’ Elevator Drives From Magnetek Magnetek’s Quattro® Elevator Drives are the green solution for high-rise buildings. Quattro drives can save as much as 40 percent on your energy costs. Available in AC or DC, Quattro drives offer proven energy savings, lower installation costs and superior ride quality while helping your projects qualify for utility rebates. Visit www.elevatordrives.com or call 800-236-1705.

Marley Engineered Products’ SmartSeries: Something This Simple Takes a Great Deal of Thought When it comes to simplicity and style, SmartSeries™ outsmarts the competition. Efficiency, form, function and a few other pretty amazing features. SmartSeriesWall Heaters continually monitor and adjust the wattage output of the heating element and fan speed to closely match the heating requirements of the space within one degree of the set temperature. www.smartseriesheat.com/ products/commercial-wall-heater/.

TDF From Maxton Manufacturing … A Simple Solution to Hydraulic Oil Contamination Are your elevators wasting energy with constant re-leveling, over shooting floors or suffering high temperatures? Contaminated hydraulic oil is the most likely culprit. Get proactive with the Tank Discharge Filter (TDF) system from Maxton and see how maintaining clean oil solves these common hydraulic elevator performance issues. Call Maxton Manufacturing 1-775-782-1700 or go online www.maxtonvalve.com.

November/December 2011 The BOMA Magazine

SUPPLIER Showcase

Of Products & Services

Special Advertising Section

Big Spheres From Meltdown Glass Utilizing the beauty and durability of cast-glass, Meltdown Glass’ Big Spheres product offers a clean, geometric solution to partition walls while preserving the organic qualities of cast-glass. This product allows designers to create spaces that allow light transmittances while still maintaining privacy. Meltdown Glass textures are available in oversize panels and can be tempered to meet safety codes. For more information, please visit meltdownglass.com or call 800-845-6221.

Quality in Motion From Mitsubishi Electric For more than 25 years in the United States, architects, contractors and building owners have specified Mitsubishi Electric for new elevator and escalator installations, modernization, preventive maintenance and repair. Our preventive maintenance philosophy results in an industry-leading call-back ratio, maximizing equipment uptime. For more information, visit www.MitsubishiElevator.com. Phone: 1-800-988-8474; Fax: 714-220-4812.

Nexus Valve’s UltraMatic The UltraMatic™ by Nexus Valve is a combination automatic flow control valve, ball valve and union. Using the UltraMatic for balancing hot and chilled water coils saves energy and money. Learn more at www.nexusvalve.com or 888-900-0947.

Stop Pest Birds With Nixalite Solutions Keep your buildings and facilities clean and free of pest birds. Since 1950, Nixalite of America has manufactured and supplied effective and humane pest bird and animal control products. To request your free catalog, please call 800-624-1189 or visit www.nixalite.com.

Oconee County, S.C. Seeks Proposals Oconee County, S.C. is accepting proposals, from private sector companies, for redevelopment of the 1956 County Courthouse into a residential, commercial or mixed-use development. Specifications may be obtained from www.oconeesc.com or by contacting Robyn Courtright, 864-638-4141, rcourtright@oconeesc.com.

Quadlogic Controls Corp. For Monitoring Metered Loads IQ² is Quadlogic’s new Web-based package for energy monitoring and tenant billing, with an intuitive graphical user interface. Property managers and engineers can monitor metered loads for consumption (kWh) and demand (kW), prepare measurement and verification reports and produce tenant invoices. Visit www.Quadlogic.com, call 212-930-9300 x326 or write info@quadlogic.com.

Infrared Radiant Heating From Radiant Electric Duluth • Reduce heating costs 30-60 % • ROI 2-3 years • Clean Room use • Zero emissions Manufactured by Radiant Electric Heat. Contact: Radiant

• Low operating temps • Reduced fire risk • Zoned individually or with building maintenance systems

• 10-year no maintenance guarantee • Allergy-free/sinus-friendly • Portable, baseboard, wall, cove, suspended ceiling units

Electric 218-525-5002.

Redi Controls’ Oil-Acid-Moisture Purger Regains chiller capacity and saves thousands of dollars per year in energy savings due to oil migration during chiller operation. Consider opportunities for Utilities Rebates, LEED and Green Buildings points. Video presentation at www.RediControls.com.

The BOMA Magazine November/December 2011

Special Advertising Section

RoofConnect … 24/7/365 Nationwide Service For All Your Roofing Needs One call offers peace of mind for your reactive roofing emergencies and proactive roof asset planning. Utilize RoofConnect’s nationwide coverage and resources for your roof management, leak repairs, capital re-roof or coating projects, snow removal and coordinated disaster response. Schedule an assessment of your roofing needs today. Call RoofConnect 24/7/365 at 877-942-5613 or www.roofconnect.com.

Special Pathogens Laboratory: Get Ready For Proposed ASHRAE Legionella Standard 188 Keep the water in your building safe with Special Pathogens Laboratory, The Legionella Experts. Laboratory services, risk assessment and outbreak consultation, and the latest on detection, control and remediation of Legionella and other waterborne pathogens. A2LA and NELAP accredited; CDC-Elite certified. 877-775-7284 or www.specialpathogenslab.com.

Upscale Recycling Bins, Benches and Planters From T2 Site Amenities Finally. Great looking recycling bins for lobbies, meeting spaces and offices. Extraordinary benches and planters. Huge array of styles, colors and materials. T2 Site Amenities. www.t2-sa.com. Call 847579-9003. E-mail lori@t2-sa.com.

Total Door: Not Just Another Pretty Door Total Door systems deliver: • Unmatched security • Quick installation—no assembly • Lower upfront costs • Fast delivery required • Durability 10 times greater • Free comprehensive maintenance • New, retrofit and custom. than conventional doors and installation training • Manufactured in the United States • Lower maintenance costs Visit www. totaldoor.com or contact sales@totaldoor.com or 800-852-6660.

YASKAWA Offers Building Automation Solution The Z1000 variable speed drive is designed for building automation applications through 500 HP. The Z1000 provides protection against drive and motor faults to maintain uptime, making it perfect for building automation applications that require reliable motor control. Phone 1-800-YASKAWA. Website http://Ez.com/yai228.

ADVERTISING INDEX Company

Page No.

AAON....................................................................................Cov 4 American Anchor................................................................Cov 2 American Arbitration Association......................................... 10 Ameristar Fence Products....................................................... 37 Aquatherm Inc............................................................................ 37 Baltimore Aircoil Co. Inc.-Cooling Tower World............ 37 Bartlett Tree Experts.................................................................. 16 BITZER US Inc............................................................................ 37 BOMA International.................................................45, 47, 49 BOMA Nevada........................................................................... 42 Clean and Polish Inc.................................................................. 37 Cleaning Services Group.......................................................... 37 Coast to Coast Direct.............................................................. 37 COIT Restoration Services...................................................... 16 Comcast Business Services...................................................... 18 Continental Control Systems................................................. 38 DADANCO................................................................................. 38 Danfoss Inc.................................................................................. 21 Directory Solutions Inc.-Touch Source............................... 38 Disaster Kleenup International (DKI)................................... 38 FLEXIM.........................................................................................15

Company

Page No.

FLIR Systems...............................................................................12 Garlock Equipment Co............................................................38 Garvin Industries........................................................................35 Gee Asphalt Systems Inc.........................................................38 General Elevator Parts..............................................................38 Grainger...........................................................................................4 Hamilton Blake Safety..............................................................39 Huguenot Laboratories............................................................39 JP Obelisk.....................................................................................14 Keyscan Access Control Systems.......................................... 13 Kidde Fenwall........................................................................Cov 3 Knox Company..........................................................................39 LEDtronics Inc............................................................................39 Lerch Bates Inc...........................................................................39 Magnetek......................................................................................39 Marley Engineered Products........................................26A, 39 Maxton Manufacturing............................................................39 Meltdown Glass Art & Design............................................... 40 Mitsubishi Electric & Electronics USA Inc.......................... 40 Naylor Publications...................................................................43 Nexus Valve.................................................................................40

Company

Page No.

Nixalite of America...................................................................40 NYSERDA.......................................................................................9 Oconee County.........................................................................40 Pro-Bel.............................................................................................7 Quadlogic Controls Corp........................................................ 40 Radiant Electric Duluth-Black Goose Chimney................ 40 RC Musson Rubber Co............................................................34 Redi Controls Inc.......................................................................40 RoofConnect..............................................................................41 Salsbury Industries......................................................................23 Sheffield Metals..........................................................................35 Shortridge Instruments Inc...................................................... 44 SIGNARAMA..............................................................................11 Special Pathogens Laboratory................................................ 41 Spot Coolers............................................................................18A T2 Site Amenities.......................................................................41 Total Door...................................................................................41 Viconics............................................................................................3 Watco Manufacturing Co....................................................... 17 Yaskawa Electric America.................................................. 41 Zeag Canada Ltd........................................................................42

November/December 2011 The BOMA Magazine

research corner

Three Common Challenges to Calculating Escalations By Tracy Glink and Lorie Damon, Ph.D.

Operating expense escalations often present challenges for property professionals, accountants and tenants alike, in part because there are no official standards to guide the practice of calculations. To help property professionals prepare their 2011 escalations, experts William H. Brownfield, CRE, CCIM and Larry Mayerhofer, CPA, founders of Brownfield and Mayerhofer, have provided a prudent review of some of the most complex elements of escalating expenses. Brownfield is also the author of BOMA’s The Escalation Handbook for Office Buildings.

Gross Ups Grossing up entails adjusting a building’s expenses to reflect full occupancy, which creates a method of comparing expense increases from year to year. Grossing up protects the tenant during periods of increasing occupancy and protects the landlord during periods of decreasing occupancy. Property managers should track both economic occupancy (leased square

Las Vegas

Where education and fun come together www.BOMANevada.org

footage) and physical occupancy (square footage that is actually occupied) each month. Tracking both metrics can be used to make the gross up more accurate when a portion of the building is leased but not occupied, thus resulting in a decrease in variable expenses. Taxes inevitably invite many questions. In some cases, it makes sense to gross up taxes if a new building opens with a partial-year assessment by the taxing district. Tenants moving in during that first year should expect their base year to be grossed up, so they will be protected in subsequent years from extraordinary increases in assessed value. Tenants with net leases, rather than base year leases, should expect their first year property taxes to be grossed up if the lease was negotiated with grossed up taxes included in their projected expenses. It is always best to retain a property tax expert to determine what the fully occupied, fully assessed value of the building should be. Continued on page 44

Plug-in electric vehicles are here. Are you ready?

EDUCATIONAL COURSE SCHEDULE 2012 DATE

COURSE

February 6-8

Environmental Health and Safety

March 19-21

Facilities Planning and Project Management

April 30-May 2

Design, Operations and Maintenance of Buildings Part 2

June 11-13

Leasing and Marketing for Property Managers

August 6-8

Real Estate Investment and Finance

Sep 17-19

Budget and Accounting

October 15-17

Technologies for Facility Managers

Nov. 5-7

Law and Risk Management

Dec. 3-5

Design, Operations and Maintenance of Buildings Part 1

For Information and Registration call BOMA Nevada’s office at 702-938-2662

The BOMA Magazine November/December 2011

Zeag Canada Ltd. Telephone: 905.813.1966 Toll Free: 1.877.791.1121 www.zeagca.com

T H E B O MA I N T E R N AT I O N A L O N L I N E B U Y E R S’ G U I D E :

http://BOMA.OfficialBuyersGuide.net

CONNECT YOUR COMpANY wITH MORE THAN 17.500 BOMA internAtiOnAl MeMBers Available 24 hours a day, 365 days a year, the BOMA International Online Buyers’ Guide is the internet’s most comprehensive resource for products and services in the commercial real estate industry. Our members spend more than $104 billion a year on office-related purchases, and they refer to our official Online Buyers’ Guide when they are looking to buy. Make sure your company has a presence!

Categories include: · · · · · · ·

Building Services Cleaning Design Management Services Mechanical Restoration waste Management And many more!

Reach the people you want to do business with at the moment they are making their purchasing decisions. Reserve your space on the BOMA International Online Buyers’ Guide today!

For information about advertising on the BOMA International Online Buyers’ Guide, contact:

Don Henesy at (800) 369-6220, ext. 3479, or dhenesy@naylor.com.

research corner Expense Caps Like gross ups, expense caps can be complicated. Expense caps are simply negotiated limits on what a tenant will be required to pay in escalated expenses and are usually described as a percentage. Often, expense caps exclude certain non-controllable expenses, such as taxes, insurance and utilities. Expenses such as security, cleaning and administrative costs are considered controllable because the landlord has a choice in vendors and service levels. While all expense caps benefit the tenant, many landlords prefer a cumulative cap on controllable expenses, as the cap is based on the first lease year’s actual expenses but generally states how much operating expenses can increase each year on a compounded percentage basis over the first year. The other alternative method for capping is the annual cap, which is based on the lower of the actual operating expenses or the capped expense amount from the previous year. It limits the percentage increase over the prior year’s allowable expenses. Tenants

often prefer an annual cap but may accept a cumulative cap if necessary.

Amortizations Amortizing capital improvements is a common practice, but not all capital improvements can be amortized. Most leases typically permit capital improvements to be amortized only if they will reduce operating expenses or if required by law to comply with building codes. Moreover, leases commonly include a clause that stipulates that capital improvements must extend the useful life of the asset beyond the original life or materially increases the value of the asset above its current book value. If the capital improvement does not meet those requirements, it’s generally categorized as a “major repair” and fully expensed in the year incurred. For improvements required by the Americans with Disabilities Act (ADA), most leases only allow “code-required” improvements that relate to code changes that go into effect after the lease commences. As the ADA Standards were recently updated, additional capital

The BOMA Magazine November/December 2011

improvements may be required to comply with the new regulations and, thus, would be escalatable. In preparing escalations estimates for tenants, understanding the key concepts and rationale behind treatment of gross ups, expense caps and amortizations can help clarify the calculations and make them more readily acceptable to both the landlord and the tenant. For more information on The Escalation Handbook for Office Buildings, visit http://shop.boma.org or www.escala tionadvisors.com. Looking for additional data to help you with your escalation calculations? BOMA’s 2011 Experience Exchange Report® (EER) is the industry gold standard for benchmarking income and expense data in commercial offices, providing valuable analytic insight into the performance and efficiency of individual buildings compared to other individual buildings and markets in the United States and Canada. Learn more at www.bomaeer.com.

Compliance Deadline Coming in March After March 15, 2012, new construction and alterations are required to comply with the 2010 ADA Standards. Don’t be taken by surprise. Act now to ensure you’re ADA compliant.

BOMA INTERNATIONAL

The ADA Standards have Changed… Is Your Building Compliant?

BOMA’s new Guide to the 2010 ADA Standards specifically addresses the next generation of accessibility rules and regulations. A follow-up to BOMA’s groundbreaking ADA Compliance Checklist, the 2011 Guidebook helps property professionals understand and implement the revised Americans with Disabilities Act (ADA) design standards implementing Title III of the ADA, adopted by the U.S. Department of Justice in 2010. The Guide to the 2010 ADA Standards includes updated requirements for accessible routes and a variety of building elements, including employee work spaces, restrooms, reach ranches, sales and service counters, stairways, telephones, special rooms and spaces, recreation facilities and much more.

Order Online Today at http://Shop.BOMA.org

ADA–082011

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By Lorie Damon, Ph.D. When it comes to measuring floor area in office buildings, property managers, brokers and leasing agents typically rely on architects and building measurement firms to determine the measurements and classifications of various types of space in an office building. While they don’t need to measure the space themselves, property managers, brokers and leasing agents do need to understand the classifications of space and how the measurements were achieved in order to administer leases, collect rents and escalations and assist in leasing space to new tenants. As office building owners increasingly seek opportunities to maximize revenues and control operating expenses, understanding and applying floor measurement standards accurately can be an indispensible tool for achieving better net operating income. In 2010, BOMA published Office Buildings: Standard Methods of Floor Measurement (ANSI/BOMA Z65.1-2010), an update to the 1996 Standard Method of Measuring Floor Area in Office Buildings. The 2010 standard introduces a number of new terms and concepts, such as two different methods for measuring floor area, including the new single load factor method, and the addition of regional leasing practices for enclosed and partially enclosed walkways and outdoor lobbies. To help industry professionals understand the new standard, BOMA International has developed two options: an online course and an in-person workshop offered in a classroom setting through a BOMA local association. Both the online course and the workshop provide a comprehensive introduction to

the new standard. Industry practitioners who participate in either course will be able to: • Explain the new terminology and concepts in the new standard; [ i ]

• Describe the two different methods for measuring office area and follow guidelines for selecting one or the other; • Determine how to use the Single Load Factor Method calculation for all floors of a multi-story building; • Execute the five simple steps to measure office space; and • Recognize and use the correct lease language to use when citing the 2010 standard. Developed in conjunction with Gemini Performance Solutions and BOMA Calgary, the online course, “Exploring and Using BOMA’s Office Measurement Standard 2010,” can be completed in approximately two hours and is accessible from BOMA’s website. The registration fee is $199 and includes a complimentary copy of the standard itself, a $49.95 value. In addition to comprehensive training that explains the new concepts and methodologies outlined in the 2010 standard, the course also includes detailed floor plans to illustrate key concepts, as well as exercises and learning assessments (including a final exam) that allow participants to gauge their understanding of the subject matter. The online learning system allows participants to start and stop the course as their schedules and paces permit. Registrants have access to the course for a

The BOMA Magazine November/December 2011

full year, affording them opportunities to complete the course at their convenience and review key concepts as needed. The in-person workshop, “Understanding the New 2010 Office Measurement Standard,” is a three-and-ahalf-hour, interactive classroom-based course designed to help property managers, brokers, architects, space planners and other industry practitioners who are familiar with the 1996 standard understand the changes in the 2010 standard and prepare them to be discerning users of the 2010 standard. The workshop includes exercises designed to help attendees practice their skills and reinforce what they learn. To participate, contact your BOMA local association to learn more about dates and space availability. Both the online course and the classroom-based workshop qualify for continuing professional development credits, including RPA, FMA, SMA, CPM and ARM credits, as well as AIA Learning Unit Hours for architects. Savvy property professionals recognize that understanding and applying the floor measurement standards appropriately in their buildings can generate significant revenues for their owners. BOMA’s training on the 2010 Office Measurement Standard is designated to help property professionals capture every available source of revenue and savings for their owners. To learn more, visit www.boma.org; click on Education; and Office Standard e-Learning Course.

GET INTERACTIVE!

The interactive downloadable formats include hyperlinks, expanded definitions and many full-color illustrations.

THE

BOMA STANDARD

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BOMA SUITE OF STANDARDS NOW AVAILABLE In 1915 BOMA published the first office floor measurement standard… and the rest is history. Today, BOMA International is the secretariat of a suite of measurement standards covering a broad range of building types. Need a floor measurement standard? BOMA has you covered. Check out BOMA’s Suite of Standards: ANSI/BOMA

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Who benefits from BOMA Standards? A cross section of real estate professionals: building owners and managers, facility managers, architects, space planners, interior designers, engineers, leasing professionals, asset managers, appraisers, brokers, general contractors and many others.

SS–072011

buyers’ guide

Buyers’ Guide to Building Products and Services PRODUCT

DETAILS New Trane Tracer™ Building Automation Systems Maximize HVAC Performance

Trane, a leading provider of indoor comfort systems and solutions, has introduced an updated Tracer ES building automation system (BAS) to optimize building efficiency. Trane Tracer ES, a web-based systems integration solution that provides facility managers a comprehensive view of all their buildings and systems from any personal computer, can now be easily integrated with Tracer SC, used to manage individual HVAC systems. Both Tracer solutions provide online, on-site and remote alarms, monitoring, scheduling, analysis and control with a user-friendly online interface.

For more information, visit www.trane.com

Schindler Enhances E-Tools with 3-D Building Information Modeling Software

Schindler Elevator Corporation now provides customers access to three-dimensional, real-time, dynamic Building Information Modeling (BIM) software on its website. With BIM, users can create “to scale” elevator and escalator models that can be viewed from any angle, helping to identify any issues with the interface to the building or other building systems early on in the design phase. Schindler customers also benefit from the company’s online My Schindler™ e-tools, which provide around-the-clock access to drawings, specifications, service activities, performance history and project schedules.

For more information, visit www.us.schindler.com

Sky Pro® Offers New Automated Window Cleaning Solution

Sky Pro has introduced the Sky Pro Window Cleaning System, an automated window washing solution for high-rise commercial building owners and managers. Available in several different models, the Sky Pro system will leave windows clean and spot-free at a rate of 17,000 to 35,000 square feet per hour. The system provides a safe and easy-to-use alternative to manual scaffold and boatswain’s chair window cleaning equipment. The system operates from existing roof rigging and cleans the entire exterior, not just glass.

For more information, visit www.skypro.com

Acuity Brands Expands Lighting Offerings for MOBs

Acuity Brands, Inc., a market leader in energy-efficient lighting and control solutions, has introduced the Healthcare Lighting® Surg5™ surgical troffer luminaire. The Healthcare Lighting Surg5 delivers consistent, high-quality lighting while providing significant energy savings and overall ease of maintenance. Designed to provide supplemental lighting in surgical suites, surgical troffer luminaires are usually mounted in arrays surrounding the perimeter of the operating table. The Surg5 luminaire is designed to deliver the equivalent light output of a six-lamp fluorescent troffer while requiring only five lamps.

For more information, visit www.acuitybrands.com

New Garland Coating Protects and Beautifies Walls

Garland’s new Tuff-Coat™ single-component, low-solvent, emulsified poly-resin architectural wall coating protects and beautifies all types of exterior and interior masonry wall surfaces, including concrete, brick work, stucco and exterior insulation finishing systems (EIFS). It provides heavy-bodied protection against moisture, sunlight, fumes and fresh or salt water, while allowing water vapor to escape the structure through its breathable film. Tuff-Coat is also low-fading and hides stains and discolorations.

For more information, visit www.garland.com

VFA Releases Solution Enabling Mobile Facility Self-Assessments

VFA, Inc., a leading provider of capital planning and asset management solutions for facilities, has released a new version of its guided facility self-assessment solution, VFA.auditor®, featuring iPad® support for mobile surveys. VFA.auditor provides facility and building managers with surveys to assess and rapidly collect data about the condition of major building systems. This latest release expands support for mobile devices, enabling the flexibility and versatility of condition assessments on-the-go.

For more information, visit www.vfa.com

The BOMA Magazine November/December 2011

245 Park, New York, NY

Rosewood Court, Dallas, TX

Riverwood 100, Atlanta, GA

KEY RESULTS

BOMA 360 BUILDINGS

NON BOMA 360 BUILDINGS

Tenant reported “good” or “excellent” overall satisfaction

91%

88%

Tenants are satisfied with the value they receive for the amount paid

73%

66%

Tenants are happy with office security policies and procedures

90%

84%

THESE BUILDINGS HAVE AN EDGE – DOES YOURS? BOMA 360 Performance Program® designated buildings outperform comparable buildings, giving them a real edge in today’s competitive environment. A 2011 Kingsley Associates study found BOMA 360 buildings have higher tenant satisfaction scores in 47 out of 50 categories. KEY RESULTS

BOMA 360 BUILDINGS

OTHER BUILDINGS

Tenant reported “good” or “excellent” overall satisfaction

91%

88%

Tenants are satisfied with the value they receive for the amount paid

73%

66%

Tenants are happy with office security policies and procedures

90%

84%

The BOMA 360 designation demonstrates to owners, tenants and prospective tenants that your building is being managed to the highest standards of excellence. For more information, visit us at www.boma.org.

The Power of Performance

conference connection

Former Defense Secretary Robert Gates to Keynote BOMA 2012 Former U.S. Secretary of Defense Robert Gates will be the keynote speaker at the Sunday General Session during the 2012 BOMA International Conference, June 24-26 in Seattle, giving attendees his candid insights on global politics and world affairs, U.S. intelligence and defense strategies, leadership and the global challenges of the 21st century. The Sunday General Session is sponsored by Yardi. One of the most respected leaders in recent U.S. history, Robert Gates served as a trusted advisor to eight U.S. presidents, driving U.S. intelligence and defense policies over the past fourand-a-half decades, from the Cold War to today’s ongoing war on terrorism. He served as Secretary of Defense under two

presidents—Barack Obama and George W. Bush—and through two wars, Iraq and Afghanistan. Considered “The Soldier’s Secretary” for his commitment to placing the men and women in uniform as his top priority, Gates made significant advances in soldier safety, including replacing vehicles in the field with heavily armored vehicles, which is said to have reduced roadside bomb attacks and fatalities by almost 90 percent. A three-time recipient of the Distinguished Intelligence Medal, the CIA’s highest award, he is the only career officer in the CIA’s history to rise from entry-level employee to director. As a nonpartisan senior-level official, Gates’ leadership and guidance earned him the National Security Medal, the Presidential

Citizens Medal and the National Intelligence Distinguished Service Medal. His successes include the reshaping of U.S. nuclear weapons policies, the removal of troops from Iraq and the resurgence of troops in Afghanistan—culminating in the death of Osama bin Laden. Until becoming Secretary of Defense, Gates served as chairman of the Independent Trustees of The Fidelity Funds, the nation’s largest mutual fund company, and on the board of directors of NACCO Industries, Inc., Brinker International, Inc. and Parker Drilling Company, Inc. He is also the author of the memoir From the Shadows: The Ultimate Insiders Story of Five Presidents and How They Won the Cold War, published in 1996.

What People are Saying Hear what 2011 BOMA International Conference attendees have to say about why the 2012 BOMA International Conference will be the commercial real estate event of the year.

Patrick D. Clark, RPA, CCIM

Katya J. Naman, CCIM, CPM, RPA

Karrie McCampbell, CPM

Business Development

Senior Vice President

Senior Vice President,

Manager

Lowe Enterprises,

Management Services

McKinstry, Seattle, Wash.

Washington, D.C.

Transwestern, Dallas, Texas

“The biggest advantage I can see by attending the BOMA conference is the vast network you develop among all areas of the business, in all geographies. I’ve taught education sessions, as well as attended them, and the education is just superb.”

“There’s such value in networking at the BOMA conference with individuals from all over the country and around the world. You have an exchange of ideas, plus you’re exposed to different ways of solving the same problems. The education sessions are relevant, timely and informative. It’s an ever-changing business, so you need to constantly upgrade your knowledge.”

“I have been attending the BOMA convention since 2004 and have always been impressed by the vastness of the tradeshow. It’s very impressive to see so many national vendors in one place, not to mention the networking is unbelievable.”

The BOMA Magazine November/December 2011

It’s 2 a.m. Do you know why your tenant’s CO alarm is beeping?

It May Not Be What You Think About seven years ago, New York City passed a law requiring carbon monoxide (CO) alarms in multi-family and private dwellings. Those alarms now need to be replaced. In fact, some of them may be sounding. Underwriter’s Laboratories (UL) requires an end-of-life warning in CO alarms. As part of Kidde’s commitment to safety, all our alarms are UL-listed and have this built-in safety feature. This means seven years after installation the alarm will sound, letting you know it’s time to replace the unit. Avoid that 2 A.M. call from your tenants. Install new Kidde CO alarms in your building today!

For more information, contact your local contractor or visit www.beatthebeep.com.

We asked customers what they looked for in commercial heating and cooling equipment. They told us:

Reliability, Quality, Durability, Serviceability So, we made sure we had all of these covered... and added one more:

lf C Un ont its ain ed

up to 16 EER

up to 14 IPLV (AC) / 24 IPLV (EC)

rs lle Ch i

up to 14 EER / 3.6 COP

up to 22 EER / 4.6 COP

G W eot SH he P rm Un a its l/ Ai r Pu -So m urc p e Un H its eat

up to 14 EER

La Sy rge st Sp em l s it

up to 17 SEER

Sm Sy all st Sp em l s it

up to 14 EER

p rg e Un Ro its oft o

al l Un Ro its oft o

Energy Efficiency

up to 19 SEER

High Efficiency

Contact your local AAON representative to learn more about AAON products and discover the many heating and cooling solutions AAON can provide.

R89580

Locate AAON representative

www.aaon.com

(AC) = Air-Cooled (EC) = Evaporative-Cooled

Rooftop Units • split systems • GeotheRmal heat pUmps • aiR-soURce heat pUmps • chilleRs • self contained Units