Newsletter Sign-up

By CHARLIE BAUROTH, account engineering manager, and TANYA GILBREATH, engineering technical unit, at Liberty Mutual Property

Vacant and idle buildings face twin perils: lack of maintenance and lack of necessary utilities. Often forgotten in the day-to-day activities of the owners, these unprotected structures can deteriorate--making them vulnerable to damage from vandals and the elements. In order to protect these buildings and have them available for future use, the National Fire Protection Association (NFPA) recommends keeping in place protection systems for fire and other exposures such as security.

An analysis of an insurance company's large loss experience in vacant and idle buildings from 2000 through early 2009 shows similar trends. Fire was the second most prominent peril in both frequency and loss amount, with 80 percent of these fires determined to be of incendiary origin.

The most prominent perils in both frequency and severity were burglary and vandalism. Of these losses, 90 percent involved theft of copper electrical or plumbing materials. This is noteworthy as there has been a noticeable increase in the past three years in the number of copper thefts from vacant or idle properties including new construction and renovation locations.

In 2006 alone this analysis shows 22 such losses totaling over $2.1 million. These losses continued through 2008 with three copper theft losses totaling over $9 million occurring at vacant retail locations.

Collapse, wind and hail were the next significant hazards for vacant and idle buildings and represented 19 percent of the insurance company's reported losses in this analysis. Although rain and snow were typically the mechanisms of overloading the roofs, and ultimately causing collapse, structural deficiencies such as rotting and corrosion were also factors. Regular inspections can minimize weather-related losses by ensuring that leaks are repaired, roof drains are clear of obstructions, ballast is evenly distributed, and rooftop equipment is adequately secured.

Water damage due to frozen or broken piping caused the remaining losses. In most of these cases, water ran undetected for long periods of time due to missing or inadequately maintained water flow alarms and monitoring equipment.

The insurance analysis also showed that many of these perils are often associated with one another. In one particular loss scenario, vandals broke into a vacant building and stole the copper wiring, piping and the wiring in a roof top HVAC unit. They also broke several windows, damaged lighting, ceiling insulation, and a sprinkler head. Because the damaged sprinkler head was on an unmonitored system, it allowed water to flow undetected and cause additional damage. The loss, more than $500,000, was eventually discovered by the owner while performing a periodic site inspection.

In another case, damage occurred when the display window in a vacant retail store was vandalized, allowing subzero temperatures to compromise the already minimal heating in the building. The window was boarded up and after two weeks of cold weather the pipes froze, broke and drained for a number of days prior to discovery. It cost more than $200,000 to repair the building.

MAINTAINING PROTECTION

Properly functioning and maintained fire alarm and sprinkler systems assume an even larger importance in vacant or idle buildings because--with no people present--they are usually the only protection and/or notification system in the event of a fire. Therefore it is critical to adhere to a schedule of periodic inspection, tests and maintenance to ensure the equipment is in good operating condition. It is also important to promptly correct and repair any deficiencies and not to change the building occupancy--which includes vacancy--withoutevaluating the capability of the fire protection systems to protect the new occupancy.

While it seems intuitive that a vacant building would be protected by the same sprinkler system that was adequate for the initial occupancy, this is not always the case. Removing combustibles and equipment from a sprinklered building does not remove all of the risk. One has to consider the conditions that will exist in the facility after it is vacant.

For instance, some buildings become vacant on a warm summer day when the threat of cold weather is long forgotten. Winter arrives and the unheated building's sprinkler lines and water pipes freeze with only a winter fire or the return of spring revealing the damage. Similarly, while the former occupants of the building were well aware of, and monitored, the building's cold spots, this knowledge is lost when the building becomes idle and those unmonitored cold spots can cause sprinkler leakage. Some facilities rely upon process heat to help warm a facility but once it is vacant or idled, that heat is no longer present. This lack of process heat can result in expensive and messy problems with the fire protection equipment and even the process equipment itself such as undrained boilers.

Another critical component of vacant building protection is maintenance of alarm systems as they are often the only way of notifying the fire department that there is a fire at the facility. The alarms should be monitored by an outside service and testing and maintenance should adhere to NFPA 72, National Fire Alarm Code. Even when a sprinkler system controls or extinguishes the fire, water can continue to flow undiscovered for days without an alarm to summon the fire department.

While a facility may have a monitored alarm system in place, nothing beats a regular visit to ensure that everything is in good condition and that the building is not forgotten. Weekly recorded visits by a representative of the owner to inspect the premises and verify that the facility is secure and that all protection equipment is in service is a key element to protecting the vacant or idle building. These visits can also reveal any structural deterioration before it compromises structural integrity as well as keep your building in compliance with NFPA 1, Uniform Fire Code for vacant buildings and premises. As the losses noted earlier indicate, an active, maintained fire protection system is one of the primary defenses for this occupancy.

Of course, any problems found during regular visits should be addressed quickly before further complications occur. And it's a good idea to conduct a post-storm visit after severe weather events such as hail or high winds to look for any damage that may have occurred.

A CHECKLIST

Other prevention practices include:

--Removing combustible storage, refuse and vegetation to reduce the fire loading both within and outside the facility as well as help maintain the building aesthetically, which goes a long way in attracting a new user.

--Following welding, cutting and other hot work criteria including having a hot work permit system in place for any hot work conducted.

--Installing monitored low temperature sensors inside the building in case the temperature starts dropping--something that can happen if an HVAC system is vandalized.

--Installing glass breakage detectors or motion detectors and video cameras--all which can be easily handled by monitored security systems.

If you have a building that will be vacant, the following actions will help you protect your facility whether the vacancy is expected to be for a short period or of unknown length. Prior to vacating a building, notify the police department, fire department, your property insurance carrier and any alarm monitoring services.

Secure the facility to limit access by unauthorized persons.

--Maintain building heat in all areas at a minimum of 40 F.

--Maintain all fire protection equipment in accordance with NFPA standards.

--Chain and lock all sprinkler control valves in the open position.

--Close and latch all fire and smoke doors. Maintain them in good operating condition.

--If it is necessary to keep a fire door open, verify that it is fully operational and the automatic closing device is provided and in service.

--Remove combustible materials from the building.

--Remove flammable and combustible liquids from the building. If this is not an option these liquids should be placed in listed flammable liquids cabinets or rooms.

--Remove all outside storage if possible.

--If this is not possible, relocate the storage to a minimum 50 feet from the building.

--Remove combustible residues from machinery.

--Remove all waste materials from the premises.

--Power down all equipment and disconnect all unnecessary power supplies.

--Disconnect and remove compressed gas cylinders from the building.

--Maintain on-call personnel to be available to assist in emergency situations, such as fires, boiler shutdown, snow removal, or other situations.

--Conduct and record weekly inspections to ensure these conditions are maintained.

Because vacant buildings are attractive to a variety of people--vagrants, arsonists, burglars or others who may be looking for a way to cover up a crime--they are susceptible to fires or other events that can consume the entire structure. Implementing a regular schedule of both internal and exterior checks of vacant/idle structures to discover problems or maintenance issues that may lead to fire and collapse or to deter burglary and other unauthorized actions will help your structure maintain its value over the long-run.

October 1, 2009

Copyright 2009© LRP Publications