GOOD NEWS FOR COMMERCIAL PROPERTY SELLERS – AB 1103 HAS BEEN DELAYED

November 28, 2009 on 12:08 am | In FASCINATING INDUSTRIAL REAL ESTATE INFORMATION, GREEN, Government, Uncategorized, all | 4 Comments

GOOD NEWS FOR COMMERCIAL PROPERTY SELLERS – AB 1103 HAS BEEN DELAYED

By Jodi Summers

Back in October 2007, when Assembly Bill 1103 was signed, the objective of reducing commercial energy consumption by, January 1, 2010, seemed a long ways away.

AB 1103, which was signed into law in October, 2007, requires the tracking of the energy use of all nonresidential buildings and the disclosure of such energy use as part of the sale, lease, or financing of an entire nonresidential building.  The stated purpose of the disclosure requirement is to “motivate building operators to take actions to improve their buildings’ energy profiles” and “to allow building owners and operators to compare their buildings’ performance to that of similar buildings and to manage their buildings’ energy costs.”

In October, 2009, Governor Schwarzenegger signed Assembly Bill 531 (”AB 531″) into law, temporarily delaying for an indefinite period of time the January 1, 2010 commencement date under AB 1103.

The state advises that owners and operators of nonresidential buildings should not delay preparations for the eventual disclosure requirement as compliance will require a year of records.

In order to comply with AB 1103, the state suggests that all owners and operators of nonresidential buildings should:

* Register for an account with Portfolio Manager

* Create a profile within Portfolio Manager for each nonresidential building owned

* Coordinate with each electrical or gas utility to automate the uploading of data to Portfolio Manager to the extent possible

* Track the implementation of AB 531 to determine the revised Disclosure Commencement Date to be set by the State Energy Resources Conservation and Development Commission (”ERCDC”)

* Ensure the Disclosure Data (defined below) is disclosed as part of any sale, lease, or financing affecting an entire nonresidential building concluded on or after the revised Disclosure Commencement Date

The intent of the law is “commercial valuation of energy usage” during a financial transaction, just as square footage is valued, says Martha Brook, senior mechanical engineer with the California Energy Commission (CEC).

A preexisting executive order, S-20-04, already mandated benchmarking the energy efficiency of state buildings.

http://www.martindale.com/environmental-law/article_Allen-Matkins-Leck-Gamble-Mallory_818224.htm

http://www.facilitiesnet.com/energyefficiency/article/California-AB-1103-Requires-Ener%20gy-Benchmarking-Data-Released-During-Sales–11020

http://www.leginfo.ca.gov/pub/07-08/bill/asm/ab_1101-1150/ab_1103_bill_20071012_chaptered.pdf

WHAT HAPPENS WHEN A TENANT ABANDONS AN INDUSTRIAL SPACE?

November 21, 2009 on 12:40 am | In FASCINATING INDUSTRIAL REAL ESTATE INFORMATION, Legal, Problem Solving, Problems, Uncategorized, all | 4 Comments

WHAT HAPPENS WHEN A TENANT ABANDONS AN INDUSTRIAL SPACE?

Edited by Jodi Summers

Hey landlords, have you ever had this happen to you –

You decide to visit a tenant whose rent is past due, and while passing by the front window of the property, you notice that the space appears to be vacant.

Do you know what to do? Can you, as the owner, just assume that the tenant abandoned the property, change the locks, and lease out the property to the next person?

Yeah right, if only it should be so simple. Being a landlord is just not that easy.

According to the California Association of Realtors legal department:

California law provides a procedure that the owner or the property manager of the rental real property must follow before assuming that the rented property has been vacated. The focus of this legal article is on this procedure for regaining possession of abandoned real property. A copy of the notice that the owner must send to the tenant is included. However, this article does not address the issue of recovery of damages by the owner.

FAQ

Q 1: If a landlord believes the rental property has been abandoned, what is the notice that the landlord must provide to the tenant?

A: The Notice of Belief of Abandonment (“Notice”) goes as follows:

Notice of Belief of Abandonment

To:

______________________________________________________________________

(Name of lessee/tenant)

______________________________________________________________________

(Address of lessee/tenant)

This notice is given pursuant to Section 1951.3 of the Civil Code concerning the real property leased by you at ____________________ (state location of the property by address or other sufficient description). The rent on this property has been due and unpaid for 14 consecutive days and the lessor/landlord believes that you have abandoned the property.

The real property will be deemed abandoned within the meaning of Section 1951.2 of the Civil Code and your lease will terminate on ____________________ (here insert a date not less than 15 days after this notice is served personally or, if mailed, not less than 18 days after this notice is deposited in the mail) unless before such date the undersigned receives at the address indicated below a written notice from you stating

Both of the following:

(1) Your intent not to abandon the real property.

(2) An address at which you may be served by certified mail in any action for unlawful detainer of the real property.

You are required to pay the rent due and unpaid on this real property as required by the lease, and your failure to do so can lead to a court proceeding against you.

Dated: __________________________________________________________

(Signature of lessor/landlord)

___________________________________________________

(Type or print name of lessor/landlord)

___________________________________________________

(Address to which lessee/tenant is to send notice)

(Cal. Civ. Code § 1951.3(d).)

Q 2: Under what circumstances may a landlord give the tenant the Notice in Question 1?

A: The landlord may give the Notice only if two conditions have been met: (1) the rent on the property has been due and unpaid for at least 14 consecutive days and (2) the landlord reasonably believes that the tenant has abandoned the property (Cal. Civ. Code § 1951.3(b)).

Q 3: What if the landlord doesn’t want to wait the 14-day requirement mentioned in Question 2?

A: If a landlord wishes faster action, the landlord may use the unlawful detainer remedy. See California Code of Civil Procedure Sections 1161-1179a. See also, the C.A.R. legal article, Unlawful Detainer: The Eviction Process in California < http://www.car.org/index.php?id=MTg4Ng >

Q 4: What if the landlord believes the property to have been abandoned and there’s been a breach of another covenant under the lease but the rent has been paid?

A: The landlord must use the unlawful detainer remedy if the landlord wants to get the tenant out of the property. See California Code of Civil Procedure Sections 1161- 1179a. See also, the C.A.R. legal article, Unlawful Detainer: The Eviction Process in California.

Q 5: What is a “reasonable” belief of abandonment?

A: Many residential as well as commercial tenants vacate the premises when behind in the rent without ever notifying the landlord. What some courts look for is whether or not the keys have been turned over to the owner. If turning over the keys establishes for the landlord a clear showing of abandonment, then the landlord may be able to take possession of the premises without providing the Notice as required by section 1951.3. Following the procedure of section 1951.3 provides greater certainty to the owner and provides protection against a tenant who later sues the landlord for legal possession of the rental property.

However, if the tenant has not made it clear—has not given over the keys—then the landlord is left guessing about the tenant’s abandonment. One way to get some idea of the tenant’s intention is to view the premises by looking through a window to see if there is anything left behind. For example, if the utilities have been discontinued, there is no refrigerator and no furnishings, abandonment seem clear.

What if some personal possessions have been left behind?

“Since many lessees who abandon real property leave personal property on the premises, the mere fact that the lessor knows that the lessee has done so should not, by itself, be held to establish that the lessor’s belief as to abandonment was unreasonable. Where the personal property left by the lessee appears to be of little value, it would be reasonable for the lessor to conclude in the absence of other evidence that the personal property, as well as the real property, had been abandoned. On the other hand, where the personal property is of substantial value and it appears that the lessee is the owner, these facts would be significant evidence that the lessee had not abandoned the real property.” (11 Cal.L.Rev.Comm. Reports 951 (1973); 12 Cal.L.Rev.Comm. Reports 571 (1974); (Cal. Civ. Code § 1951.3(e)(2).)

Note: if personal property has been abandoned too, there is another procedure to be followed. See the C.A.R. legal article, Abandoned Personal Property: Disposition of Items Left Behind After Termination of a Tenancy.

Q 6: What If the property is under a lease that doesn’t terminate for several months, what should be written on the Notice regarding the date of lease termination?

A: Assuming the landlord wishes to terminate the lease and rent it to another tenant, the date of termination of the lease specified in the Notice should be at least 15 days after the Notice is served personally or, if mailed, at least 18 days after the Notice is deposited in the mail (Cal. Civ. Code § 1951.3(b)).

Q 7: How should a landlord or property manager give this Notice to a tenant if the tenant has disappeared?

A: The landlord’s Notice can be personally delivered to the tenant (if possible) or, in the alternative, it can be sent by first-class mail, postage prepaid, to the tenant at his or her last known address (which may be the rental property address). If there is a reason to believe that the Notice sent to that address will not be received by the tenant (or will not be forwarded to a subsequent address), the landlord may also send he Notice to another address, if any, known to the landlord where the tenant may reasonably be expected to receive the Notice (e.g., a place of employment). (Cal. Civ. Code § 1951.3(c).)

Q 8: Can a landlord still assume that the tenant has abandoned the property if the landlord accepts all or partial payment of the rent due before or after giving the Notice?

A: No. If during the period of time beginning 14 days before the time the Notice was given and ending on the date the lease would have terminated in the Notice, the tenant pays all or a portion of the rent due on the real property, then the landlord cannot assume the property has been abandoned. (Cal. Civ. Code § 1951.3(e)(4).)

Q 9: What must a tenant do to prove that he or she has not abandoned the property?

A: Assuming the tenant doesn’t receive the Notice and wants to regain possession of the property, the tenant must establish that he or she hasn’t abandoned the property by proving (1) that rent was not due and unpaid for 14 consecutive days when Notice was given, (2) that it was not reasonable for the landlord to believe that he or she had abandoned the property, (3) that, within the permitted time, he or she gave written notice of his or her intent not to abandon the property, or (4) that, during the period specified in section 1951.3 (e) (4), the tenant paid all or any portion of the rent that was due. (Cal. Civ. Code § 1951.3.)

The burden of proof on these matters is placed on the tenant so that the landlord will be able to proceed to relet the property with reasonable assurance that the abandonment and termination will not later be set aside by a court. (11 Cal.L.Rev.Comm. Reports 951 (1973); 12 Cal.L.Rev.Comm. Reports 571 (1974).)

If the tenant receives the Notice, the tenant must respond in writing prior to the termination date in the Notice that the tenant has not abandoned the property and must provide a current address for the landlord. In addition, the tenant must pay current all rent that is owed. (Cal. Civ. Code § 1951.3(d).)

Q 10: Does the law discussed in this legal article pertain to all real property, commercial and residential?

A: Yes. The law applies to all real property (Cal. Civ. Code § 1951.3(a)).

Q 11: Does the law discussed in this legal article apply to mobilehomes?

A: No. For abandonment of mobilehomes, see the Mobilehome Residency Law; in particular, see California Civil Code Section 798.61.

Q 12: Where can I obtain additional information?

A: This legal article is just one of the many legal publications and services offered by C.A.R. to its members. For a complete listing of C.A.R.’s legal products and services, please visit C.A.R. Online at www.car.org.

Readers who require specific advice should consult an attorney.

**

Reprinted with permission of the California Association of Realtors. Credit for this piece is to be given to the C.A.R. Legal Department.

http://www.car.org/legal/2007articles/abandoned-rental-real-property

http://uas.osu.edu/slideshow/xml/189?1256748258

http://zombiestories.files.wordpress.com/2009/06/abandoned_office.jpg

http://i.pbase.com/o6/31/766831/1/80308129.Vs1GQRbg.4845.jpg

http://yalesustainablefoodproject.files.wordpress.com/2009/02/kk_space02.jpg

http://neatorama.cachefly.net/images/2006-05/toronto-don-valley-brickworks-ducts.jpg

http://farm1.static.flickr.com/62/197713774_292e538457.jpg

http://www.socalindustrialrealestateblog.com/wp-content/uploads/2007/12/abandoned%20industrial.jpg

ALTERNATIVE ENERGY POLL – SOLAR RULES

November 14, 2009 on 12:49 am | In CHARTS + STATISTICS, GREEN, Trends, Uncategorized, all, statistics | 4 Comments

ALTERNATIVE ENERGY POLL – SOLAR RULES

Edited by Jodi Summers

An overwhelming majority -92% of Americans polled - Support Solar Energy Development, according to the 2009 Schott Solar Barometer. The Schott Solar Barometer is a national survey conducted by independent polling firm Kelton Research.

The overwhelming support for solar power is consistent across political party affiliation with 89 percent of Republicans, 94 percent of Democrats and 93 percent of Independents agreeing that it is important for the U.S. to develop and use solar power.

Furthermore, close to eight in 10 (77%) Americans feel that the development of solar power, and other renewable energy sources, should be a major priority of the federal government, including the financial support needed. This sentiment also remains the same since June 2008 (77%).

If only given the opportunity to support one source of alternative energy, 43 percent of Americans would opt for solar over other sources such as wind (17%), natural gas (12%) and nuclear (10%).

Almost half of all Americans (49%) say they’re currently pondering solar power options for their home or business – and another three percent already have solar power. Among those who would like to take advantage of solar power at home or at work, seven in 10 (70%) envision they would make the change within the next five years.

The general consensus is that many Americans feel they lack information – fewer than one in five (12%) - can claim that they’re extremely informed about the subject of solar power in general. What’s more, almost three in four (74%) Americans admit they wish they knew more about solar power options for their home or business.

http://www.cleanedge.com/news/story.php?nID=6455

http://www.resourceactionprograms.org/blog/index.php/tag/southern-california/

http://saferenvironment.wordpress.com/2009/02/02/solar-power-%E2%80%93-sustainable-green-energy-to-protect-our-economy-and-environment/

http://www.geni.org/globalenergy/library/articles-renewable-energy-transmission/solar.shtml

http://www.sunandclimate.com/images/solar-power-dallas.jpg

http://www.generatormart.com/200806092224444674.shtml

http://earth911.com/blog/2007/10/15/pros-and-cons-of-solar-power/

THE GOVERNMENT’S COMMERCIAL PROPERTY ENERGY GOAL: TO MAKE BUILDINGS NET ZERO BY 2025

November 8, 2009 on 12:05 am | In CHARTS + STATISTICS, FASCINATING INFORMATION, GREEN, Government, Problem Solving, Trends, Uncategorized, all, statistics | 7 Comments

THE GOVERNMENT’S COMMERCIAL PROPERTY ENERGY GOAL: TO MAKE BUILDINGS NET ZERO BY 2025

By Jodi Summers

The US Department of Energy wants to reduce the amount of energy used by commercial buildings from about 19% of total US energy consumption to 0% by 2025.

To achieve this goal (watch, Santa Monica), the DOE is offering solutions sector by sector, dialoguing with owners and developers about ways to capitalize on new technologies and reduce energy consumption,.

The DOE kicked off its Zero-Net Energy Commercial Building Initiative lastyear by establishing the National Laboratory Collaborative on Building Technologies and developing the Commercial Building Energy Alliances.

The objective of the Alliance is to share best practices and practical experiences in energy efficiency.

The Commercial Building Initiative focuses on “turning tomorrow’s buildings into domestic energy assets by constructing energy-efficient, high-performancebuildings that expeditiously and cost-effectively achieve sustainable carbon reductions and enable, through energy-efficient buildings, higher ROIs for building owners and occupants as well as to economy as a whole.” - Official word from says Drury B. Crawley, team leader in commercial buildings research and development for the DOE’s Building Technology Programs.

The rollout was a collaboration between U.S. Department of Energy and 19 commercial real estate companies, with the goal of linking building owners to the latest efficiency research and technologies from the agency’s laboratories. High profile retailers including Wal-Mart, Target and Macy’s have become involved in the Retailer Energy Alliance.

The DOE proudly notes that this “public-private partnership designed to minimize the energy consumption and environmental impact of commercial buildings.”

The focus of thе latest phase of the Alliance is to minimize energy use in leased space, offices, shopping malls and the hospitality industry.

Kudos to the DOE for this bold attempt to curtail usage in properties that involve so many random people passing through who give no thought to the building itself.

With commercial buildings comprising roughly 18 percent of the country’s energy consumption, the DOE feels that commercial holdings represent a large opportunity to cut usage. Best practices are shared and the alliance, and the goal is to serve an industry voice to advocate for more energy efficient equipment from the nation’s building materials suppliers.

Henry Chamberlain, president and COO of Building Owners and Managers Assoc. International, called the Alliance “a catalyst for long-term change” that can reduce the use of energy, cut greenhouse gases and drive innovation in the marketplace.

Each Commercial Building Energy Alliance brings together industry experts who can influence the energy footprints of the companies or institutions they represent. Members discuss energy challenges, share non-proprietary information, conduct energy saving assessments and cut the cost of high-efficiency building equipment through group purchases. They can also benefit from the technical assistance of the DOE.

The DOE has already created a steering committee for the next Commercial Building Energy Alliance, which will examine energy use in hospitals. The DOE describes the nation’s 8,000 hospitals as among its “most energy intensive commercial buildings, with more than 2.5 times the energy intensity and carbon dioxide emissions of office buildings. Unlike most other commercial buildings, hospitals are operational 24 hours a day, seven days a week and provide services even during power outages, natural disasters…”

All alliances are part of the DOE’s Net-Zero Energy Commercial Building Initiative targeting zero-energy commercial buildings by 2025.

Go to http://www1.eere.energy.gov/buildings/tax_commercial.htmlFor tax deductions that are available for improving the energy efficiency of commercial buildings, as well as links to qualified software available for calculating the savings.

 

The Net-Zero Energy Commercial Building Initiative was signed into law by former President Bush as part of the Energy Independence and Security Act of 2007, and is authorized for more than $1 billion in federal funds over the next decade. DOE committed $15 million last year to the program’s first phase, a research project involving two national laboratories and 21 companies that will produce new and retrofitted buildings with significant cuts in energy consumption.

Tools:

The DOE has taken a number of steps to encourage energy efficiency in the design of new buildings. EnergyPlus is an energy modeling tool, which is augmented by OpenStudio, a plug-in for the Google SketchUp 3-D drawing program that allows SketchUp to work seamlessly with the EnergyPlus program.

Both are available on the EnergyPlus page of DOE’s Building Technologies Program Web site.

http://apps1.eere.energy.gov/buildings/energyplus/

That site also features a selection of benchmark models for 16 types of building in 16 locations to help designers understand the energy use of similar new buildings- http://www1.eere.energy.gov/buildings/commercial_initiative/new_construction.html

 

**

sources:

http://www.globest.com/news/1391_1391/insider/178282-1.html?type=pf

http://www.energy.gov

http://apps1.eere.energy.gov/news/news_detail.cfm/news_id=12446

http://www.greenbiz.com/news/2009/04/10/doe-forms-commercial-real-estate-alliance

http://www1.eere.energy.gov/buildings/retailer

http://www.ggashrae.org/meetings/2008-2009/speaker_presentations/Crawley.pdf

http://www.costar.com/News/Article.aspx?id=C94B2CDD13C1546D6DBB4F76C65D20B1

http://apps1.eere.energy.gov/news/news_detail.cfm/news_id=12450

http://www1.eere.energy.gov/buildings/commercial_initiative/new_construction.html

http://itecsinsider.com/?tag=green-buildings

http://jcwinnie.biz/wordpress/imageSnag/nzero01.jpg

http://naturalpatriot.org/wp-content/uploads/2007/09/livingroof.jpg

http://www.building.lv/latinzenieris/images/99265_01.jpg

 

LOS ANGELES INDUSTRIAL PROPERTY SNAPSHOT – NOVEMBER 2009

November 2, 2009 on 8:08 am | In CHARTS + STATISTICS, FASCINATING INDUSTRIAL REAL ESTATE INFORMATION, Uncategorized, all, statistics | 6 Comments

LOS ANGELES INDUSTRIAL PROPERTY SNAPSHOT – NOVEMBER 2009

By Jodi Summers

According to Forbes the economy grew at a 3.5% annualized rate. That was better than many economists expected, but let’s face it, that’s not booming good times. This slightly more optimistic national forecast is driven by increased consumer confidence and an increased demand for California produced goods.

The UCLA Anderson School Senior Economist David Shulman observed that, “the majority of short-term growth will come from a dramatic reversal in inventories, where after plunging at a revised annual rate of $159 billion in the second quarter, real inventories are expected to increase by $12 billion in the fourth quarter of this year.”

A bit of optimism in a dismal industrial market. Industrial vacancy rates jumped to 10.2% in the third quarter — a 180-basis-point increase from the 8.4% reported during the same quarter last year and up from 9.8% at midyear 2009, according to the third-quarter industrial review delivered by Jay Spivey, senior director of research and analytics, for CoStar. Negative absorption topped 44 million square feet in the third quarter of this year as companies continued to shed warehouse, flex and manufacturing space in the face of continuing job losses.

In Los Angeles from October 2007 to October 2009 the median sold price is down 69%. The number of properties for sale is up by 41%, while the number of properties that have sold continue to be dismally few. Additionally, properties are remaining on the market for longer and the number of properties being taken off the market due to lack of buyers is rising. Only owner-users have been net buyers of industrial real estate in 2009, with private companies and REITs disposing of property and private equity and institutions staying mostly on the sidelines, neither buying nor selling.


Looking forward to 2010, CoStar forecasts that, although the national industrial vacancy will rise as high at 11%, the amount of net vacant space on the market should begin to taper off over the next two quarters. By mid-2010, (barring a double-dip recession) the industrial market is expected to slowly resume, though rents are not expected to start climbing until 2012-13. Net operating income (NOI) growth for industrial building owners, which flattened last year and had fallen nearly 6% as of midyear 2009, will continue to decline through 2011.

Looking for some specific details? Would you like to be our client – we’ll take good care of you. Contact the SoCal Investment Group through Jodi Summers, Jodi@jodisummers.com.

**

http://www.clarusresource.com/

http://www.uclaforecast.com/contents/archive/2009/media_91609_1.asp

http://www.dqnews.com/Articles/2009/News/California/Southern-CA/RRSCA091013.aspx

http://www.costar.com/news/Article.aspx?id=A473652CBA5022AE544D5933473223FC

http://www.forbes.com/2009/10/30/property-recession-apartments-personal-finance-real-estate-advisor-stock-talk.html?partner=alerts

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