The devastation caused by last month’s massive 8.1- and 7.1-magnitude earthquakes in Mexico City serves as a grim reminder of the importance of building safety to guard against death, injury and property damage.
There’s no disputing that saving lives is the ultimate concern in preparing for an earthquake, but did you know that building retrofits bring about many cost benefits as well?
Save Up to $7 for Every Dollar Spent
Researchers at Caltech have determined that for every dollar spent in retrofitting soft-story structures, property owners could expect to save up to seven dollars, and that study didn’t factor in loss to contents, alternate living expenses or deaths and injuries – all of which would have significantly increased the cost-to-benefit ratios.
In a separate study, the university determined that seismic retrofits are cost-effective when projected annualized loss would be reduced by 50 percent or more at a cost that would equal no more than 10 percent of the replacement cost of a building.
The Federal Emergency Management Agency found similar cost benefits in a two-year analysis of seismic retrofit scenarios applied to a variety of building types, including a scenario of a tilt-up warehouse building in California.
“In this example,” the study found, “the benefit/cost ratio is about 10 without the value of life and about 12 with the value of life. The benefit/cost analysis suggests that a retrofit is strongly justified economically, even without including the value of life.”
Liability, Loss of Income
Loss of income can occur when commercial property is damaged to the point where it is no longer habitable. This can create severe financial hardship for property owners who not only lose their monthly rental income, but are simultaneously facing the costs of recovery coupled with ongoing monthly payments associated with their original mortgage.
What legal risks do property owners face if they don’t have their buildings retrofitted? A two-year study funded by the National Science Foundation’s Earthquake Hazard Reduction Program determined that case law puts the question in the hands of a jury to decide.
In a precedent-setting case in Paso Robles, two employees of a clothing store were crushed to death by falling bricks during an earthquake in 2003. The building had been ordered by the city to be seismically retrofitted, but the deadline to do it had not yet passed.
A jury in the case found the building owner negligent based on the fact that he had received a retrofit order, knew the building was potentially dangerous but had not taken action to correct the problem.