It’s been a difficult year for owners of rental income properties, with up to 20% of Southern California tenants behind on rent and many owing balances in the tens of thousands of dollars, according to various reports.
News coverage cites anonymous owners afraid to speak out on how policies put in place during the pandemic have taken a toll on their bottom line. One owner, in his 80s, told the Los Angeles Times he had let his lender know he could no longer meet payments and expects to hand the 200 units he owns back to the bank.
Hindsight gives us the clarity to better prepare for circumstances like these – times when the fabric of society is disrupted to and people’s livelihoods and life’s savings are at stake.
This same threat applies to the physical resilience of a community: be it from flood, hurricane, fire, or earthquake. The Federal Emergency Management Administration urges hazard mitigation to reduce loss of life and property by minimizing the impact of disasters. Key to this plan is the investment of governments, businesses, communities and tribes to develop and implement long-term strategies to protect people and buildings.
In the case of earthquakes, several cities and counties have adopted mandates requiring at least some vulnerable buildings to be retrofitted for safety. These include: Alameda, Berkeley, Beverly Hills, Burbank, Fremont, Los Angeles, Los Angeles County, Oakland, Pasadena, Richmond, San Francisco, San Jose, Santa Clara County, Santa Monica, and West Hollywood.
In situations where the retrofits are voluntary, many building owners chose to ignore the risks and fail to weigh the severe consequences of not taking action. Here’s what is projected:
If a 7.8-magnitude earthquake were to strike along the San Andreas Fault in Los Angeles today, one in every 16 buildings in the region would be damaged, according to the U.S. Geological Survey.
Other USGS projections for this scenario include 1.800 deaths, 50,000 injuries, $213 billion in property and infrastructure losses, 121,339 displaced households (351,883individuals).
Protecting Your Building and Livelihood
Retrofits enhance a building’s value by extending its longevity and making it safer for the people who occupy it. But there are many other positive cost benefits as well.
These benefits include protection from:
- Liability associated with damage, death, and injury
- Loss of income when your building is red-tagged for months or years
- The cost of paying your original mortgage loan, even when the building is destroyed
- Demolition costs including abatement of asbestos and lead
- Reconstruction costs, code upgrades and cost overruns
Financial incentives such as preferable loan and insurance rates, density bonuses, reductions in development standards and relief from nonconforming provisions also incentivize building owners to do upgrades that promote building safety and revitalize communities for greater economic impacts.
Resilience is good for communities, and good for business.
Find out whether your apartment building is at risk with a free consultation. Visit optimumseismic.com for more information, or call 323-978-7664.
You can also learn more by participating in Optimum Seismic’s upcoming workshop held in partnership with the Apartment Association of Orange County from 1 to 2 p.m. Monday, July 12 on zoom. Pre-registration is appreciated, please visit OptimumSeismic.com/upcoming-events.
