NEW OPPORTUNITIES MEAN NEW CONSTRUCTION DEFECT EXPOSURES

Whatever your situation, keep in mind that new opportunities can also present new risks:

  • New relationships with unknown or unproven subcontractors
  • Different territories with different insurance requirements and legal environments
  • New risks and exposures you may be inexperienced at managing
  • Being forced to “learn as you go” on projects you’re not used to handling

Also remember that if you build it, you can be sued.

Construction defect claims are brought for a variety of reasons – deviations from building code or architectural plans, defective materials, or even disgruntled customers with imaginary issues, just to name a few. And construction defect lawsuits can quickly ensnare contractors, subcontractors, land owners, developers, and anyone else involved in a project. In short, if you’re involved in building, a customer can sue you in a construction defect claim – for up to 10 years in some states.

Before you venture into uncharted waters, take these steps to avoid getting caught up in a costly construction defect claim:

1.  Do your homework on new subcontractors. Carefully screen and get to know the reputations of any new subcontractors you’ll be using, including how well trained their workers are. Make sure every subcontractor has insurance and that you receive a Certificate of Insurance from them every year – and that you’re named as an additional insured. Check their limits of liability to ensure they’re the same as yours.

2.  Understand the insurance and legal requirements. If you’re doing business in a new territory, you’ll need to be thoroughly familiar with the laws and insurance requirements of that area. It’s worth the time and expense to consult with an attorney and a local insurance expert.

3.  Have a quality assurance/quality control (QA/QC) program for every project. A QA/QC program can help ensure that a project is done right the first time and performs as intended. The QA/QC program should outline areas such as risks and exposures, management responsibility, materials selection, subcontractor selection, workmanship, inspections, and documentation.

4.  Document and save everything. Construction projects create a mountain of paperwork including log books, inspection forms, purchase orders, training documents, and specifications. This information can be vital to investigators for sorting out what happened in a construction defect claim, and not having proper documentation can only cost you money. And since construction defect claims usually pop up long after a project is completed, you need to save everything. A local attorney can advise you of state requirements on document retention.

5.  Carry the proper insurance. With the maze of policies, exclusions, endorsements, and coverage questions involved in the typical construction defect claim, make sure you and everyone involved in the project have adequate coverage.

Construction defect lawsuits can be extremely complex, with multiple parties and insurance policies involved. They can be time-draining, often dragging out for months or years. And they can be costly, sapping precious financial resources to pay for litigation, repairs, and settlement costs. So before you venture into new opportunities, make sure you understand the risks and take steps to protect your operation.

For more information about how to protect your business from construction defect claims, see the New York construction insurance experts at Milbrandt. Request a construction insurance quote, or to learn more about the types of clients we work with, download our Construction Case Study Six Pack

Doing Well and Doing Good with the Green Air Hotel

By Zachary Edelson

Chiong saw an opportunity for architecture and space-age science to come together to address two different challenges in one fell swoop: the troubled hotel industry and China’s severe pollution problems. In terms of the former, his Shanghai-based firm had extensive experience working in the hospitality industry before, both in refurbishing and designing brand new hotels. He saw that many hotels were struggling to set themselves apart and attract customers. “A typical renovation may be to rebrand the hotel through styling and aesthetics,” says Chiong, “but such a cosmetic touchup will not distinguish or give this type of hotel a truly competitive edge.” In terms of the latter, Beijing’s pollution rating can reach 775 when 300 qualifies as an emergency by the EPA, making health a real selling point. Consequently, his firm collaborated with Bill Wolverton, a NASA scientist, to design an ingenious solution: a literally green hotel that cleans its air using special filtering plants.

His “Green Air Hotel” can naturally filter the hotel’s air, thereby supplying a unique environmentally-friendly service that would also provide the hotel with a lush visual identity. Chiong teamed up with Wolverton to figure out the specific plants and atmospheric mechanics required to deliver a true “green air hotel.” The architects came across Wolverton’s work during the course of their research. “Dr. Wolverton was one of the first scientists working with NASA since the 70s,” said Chiong, “to study phytoremediation or the cleansing powers of plants, to be used in closed ecosystems such as the space stations.” Similar projects might be the Eden Project in Cornwall, England, or Biosphere 2 in Arizona : a natural environment without any of the high maintenance associated with HEPA systems and other intensive filtration systems. Most Chinese hotels utilize standard filtration systems that accompany air-handling units, “Often with less than satisfactory standards due to poor maintenance, “ says Chiong.

The proposed Green Air Hotel would host a wide variety of filtering. Their specific biological preferences for light levels and environmental conditions were taken into consideration, and with the help of Wolverton, appropriately placed throughout the hotel based upon air flow, natural and artificial light, and other factors. The architectural template seen here is based on an actual hotel refurbishment project by Studio Twist, located 1.5 hours outside Shanghai. This proposal features a soaring atrium of trees and greenery, a large collection of plants in every room, and further greenery throughout the hotel’s hallways and elsewhere. These plants would be monitored and watered by hotel staff on a daily basis while a specialist would also regularly visit for inspections. Chiong has already received interest in his concept from other designers and consultants who work with the hospitality industry in China. With over 100 entrants from 28 countries, the selection of the Green Air Hotel indicates that the hospitality industry is excited to use green design as a path to success in the future.

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How cap-and-trade helps forests and businesses grow together

How cap-and-trade helps forests and businesses grow together

Portland’s nickname “Stumptown” reflects the central but conflicted role of trees in Oregon’s physical, cultural and economic landscape.

Forests cover nearly half of Oregon’s 62 million acres, and while wood product markets have faced challenges in recent years, the forest sector employs more than 76,000 people in Oregon and accounts for nearly 7 percent of Oregon’s economic base. In some rural counties, the forest sector accounts for up to 30 percent of the local economy.

Forest ecosystem services — clean water, habitat for fisheries, recreational use and carbon sequestration — also provide important but sometimes hard to value sustenance to economies and society.

Carbon markets, and especially the success of improved forest management projects in California’s cap-and-trade system, provide a path for sustainable forest management that bridges what is sometimes portrayed as conflict between timber harvest and conservation, supporting both economic and ecosystem goals.

In June, California Air Resources Board issued 2.43 million offsets to two new improved forest management projects (2.16 million offsets to Blue Source and Heartwood Forestland Fund’s Bishop Improved Forest Management Project; 270,000 offsets to the Miller Forest Improved Forest Management Project), and forestry projects officially became the largest source of offsets for California’s Cap-and-Trade program, surpassing offsets produced by Ozone Depleting Substances projects.

Although only eight forestry projects have been issued ARB offset credits — compared to 34 ODS projects and 15 Livestock projects — the 5,890,103 offsets issued in total to these forestry projects make up more than 52 percent of the 11.2 million offsets issued to date.

Notably, improved forest management projects can include sustainable timber harvest, so that forest owners can benefit from multiple revenue streams and forest systems can benefit from management that develops strong, resilient forests. Some of these projects incorporate working conservation easements that protect working forests, preserving these lands with the aim of sustaining timber and other forest products in perpetuity together with forest conservation values.

With more projects working their way through the carbon market process, it is encouraging to see forestry rewarded through this market-based mechanism for the climate benefits of improved management of these vital resources.

Markets are working, but challenges remain for making carbon markets work to support forest owners and businesses in Oregon and beyond.

In Oregon, 60 percent of forest land is owned by the federal government and so is ineligible for participation in the California cap-and-trade offset market.

Projects on other public lands also can be a challenge under California compliance market standards.

Voluntary markets provide more diverse approaches for forest owners, but a recent report by Ecosystem Marketplace showed that average offset prices in voluntary markets dropped slightly in 2013.

EPA’s Clean Power Plan, while admirable, does not provide a clear path for support of forest carbon offset projects at national scale. Given the tremendous range of products and services we enjoy from healthy, functional forest systems, ensuring that these benefits to climate, water and life are supported means available benefits for us all.

If we want to support counties, cities and businesses in Oregon that aim for healthy forests instead of Stumptowns, we need to foster innovations in carbon and other markets that help forests and businesses grow together.

Top image by Lightspring via Shutterstock.

Building Green: How Copper can LEED the Way

Have you ever considered the green attributes of copper? Copper has been used for centuries as an aesthetically pleasing building material that resists corrosion and oxidation. The many alloys of Copper, such as it’s brasses and bronzes, are visually stunning. The visual attributes, coupled with Copper’s unique physical and mechanical properties, ensures that designers and building owners can achieve their visual  and performance specifications, but also are able to meet their environmental and cost performance goals.

Copper products are durable, low maintenance, reusable and recyclable. In fact, many copper-containing building products have high recycled content; often 80% or more. Building applications for copper metals range from the building envelope to the equipment used in the building, such as, roof and wall cladding, flashing, gutters, and downspouts. Copper roofs and cladding do NOT have to be replaced, often lasting over a century. This longevity eliminates the need to use new roofing material and prevents the waste generated from other old, worn roofing material. The higher initial cost of using copper is offset by low to virtually no maintenance costs over the operational life of the building. Because Copper has a minimal impact on energy consumption and natural resources, its use has an extremely positive impact on energy efficiency, indoor air quality, as well as, life cycle costs.

Copper’s benefits extend beyond construction completion. When a building is demolished, all of the copper is recyclable. Nearly all of the copper that has ever been mined is still in use today. With the exception of high performance wiring applications, recycled copper maintains its performance attributes through the recycling process, and is NOT down-cycled into lower value products.

Copper contributes to achieving LEED credits by saving energy and reducing a building’s carbon footprint. The bottom line is that for an addition upfront cost of about 2% to support green design, there is an average life-cycle savings of approximately 20% of total construction costs.

Where Copper Counts    

  • Innovation & Design Process (LEED) Innovation in Design
  • Materials & Resources (LEED) Building Reuse, Recycled Content
  • Energy & Atmosphere (LEED) Optimal Energy Performance
  • Competitive Operation, Maintenance & Energy Costs (BEES)
  • Comfort of Indoor Occupant
  • Sources: Copper Development Association (CDA)

How Copper Helps

  • Recycled Content
  • Envelopes, roofs, plumbing
  • High efficiency wiring
  • Passive solar heating
  • Low maintenance exteriors
  • Sunshades, plumbing,  and Internal monitoring systems
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– See more at: http://blog.greenwizard.com/wp/2014/08/building-green-how-copper-can-leed-the-way/#sthash.GgON3FFb.dpuf

22,000 New SF Residents Hunt for Apartments That Don’t Exist

sf by Tracy Elsen

The latest census data estimates that San Francisco’s rise in population since 2010 was 32,000 people, but only 4,200 new housing units have been added in that time. Given that the average household size is 2.3 persons, this means that there are 22,000 more new people than new homes available in the city over the past four years. According to the latest research from local real estate company Paragon Commercial Brokerage, this imbalance has been the biggest factor in the rampant home and rent price increases over the past few years. With the economy booming, new San Franciscans keep arriving despite the fact that the city has no room for more people in its current housing stock. High rents have also meant that the cost of buying an apartment building to rent out has skyrocketed 51% since 2010.

One of the reasons for the housing shortage is the crash of 2008, when the recession caused a huge dip in the number of new projects planned. The construction recovery lagged behind the recovery in the local job market because projects generally take years to build. Building of new units has now started up again, but isn’t yet close to meeting the surging new demand.

White Paper: Email Re-Marketing Is Multi-Family Missing Out?

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This new paper, conducted by D2 Demand Solutions, is based on research into how 31 well-known national and regional multifamily operators responded to online leads from prospective renters. Download the paper, check out the results, and share your feedback! http://hubs.ly/y03_KH0

So much attention is given to social media and a lot of money spent on websites, ILS and traditional media, all with the goal of generating leads. But what, other than having leasing associates engage leads, does our industry do with the leads they get? This paper discusses the results of a test on how typical operators use email re-marketing as part of their “lead consideration.”

LED Lighting Prices Projected to Fall

LED lighting prices expected to fall.

Revenues from LED lighting products in commercial building markets are projected to grow from $2.7 billion in 2013 to more than $25 billion in 2021, according to a recent report from Navigant Research.

When LEDs were first introduced for general space lighting they were expensive, not very efficient, and too dim. Today, LED-based lighting products can successfully compete with rival technologies on the basis of light quality, efficiency, dimmability, and almost any other important metric except for price – which is falling rapidly.

“The rise of LED technology will transform every part of the commercial lighting industry,” says Jesse Foote, research analyst at Navigant Research. “While other lighting technologies have limited potential for future improvements, new designs for LEDs that push quality and efficacy to new levels continue to emerge from lighting labs around the world.”

In the coming years, LED prices are expected to fall to a point where savings from electricity consumption will provide a short payback period that will encourage consumer adoption en masse, according to the report. This shift will be most dramatic in the share of lamps sold for retrofit projects, where older lighting is often replaced specifically to improve efficiency. Although Navigant Research reports that only 5 percent of lamps sold to retrofit projects worldwide in 2013 were LED-based, that share is expected to grow to 40 percent by 2017 and 63 percent by 2021.

The full report is available from Navigant Research.