Institutional Real Estate, Inc.

NAREIM Dialogues Fall 2017

The Institutional Real Estate Inc Sponsorship brochure, Connected-Investor Focused, We connect people, data and insights, sponsorship, events, IREI Products

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Page 27 of 47

NATIONAL ASSOCIATION OF REAL ESTATE INVESTMENT MANAGERS 26 NAREIM THIS BUILDING IS BRAND NEW! IT'S JUST FINE! Actually, it may not be... How is it possible that a newly constructed building would have issues with quality of construction? One might think at present, with experienced developers, designers, architects and contractors on board, that issues of construction quality would be increasingly rare. Unfortunately, we still see teams surprised by these kind of issues, which can unfortunately be a challenge to real estate transactions. WHY? WHAT IS THE PROBLEM? Quality of the construction workforce: The construction industry was severely impacted by the Great Recession. Many people left the industry during the downturn; not all of those people came back. We regularly see and read about construction firms not finding enough personnel to satisfy their current workloads. As one result, they are having to hire people that are either less experienced, or have no prior experience in construction. There is a lack of collective training and development of these newer personnel, which translates to an end product that can be inconsistent. Supervision of 3rd party observers: While developer have 3rd party observers as part of the project team, we have seen cases where the 3rd party observations did not help the quality of the construction. Developers do not always follow through on getting appropriate oversight of the elements and/or systems observed. Having documentation summarizing findings, as well as pictures to support such findings becomes critical. In particular, where constructed elements will be covered by finish materials, such documentation is the only reliable way to verify quality of construction after the fact. With respect to disabled accessibility, one issue is uneven enforcement. Compliance with the State or City Building Code is enforced through plan check and inspection on the local level, but accessibility required by overlapping federal standards are not a part of their review. The extent to which a local building inspector is familiar with these requirements varies greatly. Unfortunately, in too many instances, agencies have on the whole, neither the inclination nor funding to train appropriately to standards other than those required locally. As a result, enforcement of federal standards often happens by lawsuit after the fact – a situation no building owner desires. The area of disabled accessibility design is not well-understood, and there are a variety of interpretations, gray areas, and reasonable accommodations that can be argued to be compliant – there can be more than one way to solve the problem. Accessibility standards can seem to be constantly in flux, requiring expert help to interpret and understand what the current professional opinion of the regulations require – what are the best practices. Overlapping federal, state and local requirements do not trump each other in whole, but must be complied with fully down to each area, element, or measurement. Meeting one standard does not excuse one from meeting other applicable standards; hence the Chris Geier, P. E. VicePresident, Marx|Okubo Associates, Inc.

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