May 2019

40 MAY 2019 • WWW.AAGLA.ORG It’s been three years since the City of Los Angeles started sending out orders requiring seismic retrofitting of vulnerable soft-story and non-ductile concrete buildings. Soft-story property owners, upon receipt of these official notices, were required to: • Submit proof of a previous retrofit, or plans to retrofit or demolish (within 2 years) • Obtain a permit to start construction or demolition (within 3.5 years) • Complete retrofit construction (within 7 years) Given these deadlines and the three years that have transpired since the first orders were mailed, what percentage of the city’s vulnerable soft-story buildings have been retrofitted so far? City officials were briefed last month that only 14 percent of soft-story buildings have been retrofitted. None of the concrete buildings issued these orders has completed the work, according to a recent report by City News Service. Yes, owners of these structures still have time to complete the retrofit process. (Non-ductile concrete buildings were given 25 years to get the job done.) But the fact remains that waiting could be much costlier for these building owners, given the risks associated with liability, loss of income and tenant relocation, should the building be damaged in a quake. A Case of Negligence Building owners who know their buildings are vulnerable to damage and or collapse in an earthquake are liable — even if their deadline to retrofit their buildings has not yet passed. This was the precedent set by a case in Paso Robles, California where, during an earthquake in 2003, two employees of a clothing store were crushed to death by falling bricks and plaster as they ran out of a building. The unreinforced masonry building had been ordered by the city to be seismically retrofitted but the deadline to do it had not yet passed. The families of the women sued the property owners and won. A jury awarded them $2 million, finding that the property owners were negligent because they knew the building had the potential of being unsafe in an earthquake and yet they did nothing about it. A state appeals court upheld the verdict in 2010. The precedent was set: It didn’t matter whether the quake was an “act of God” or that the building technically complied with city building codes because the deadline for the retrofit had not yet passed. The jury determined that the simple fact of knowing a building is unsafe and not taking action is grounds enough to assign blame through negligence. Here’s why it makes sense to retrofit now: 1. Retrofits protect building equity: They guard against loss that could bring about a reduction in your property’s value or a total loss of the building, depending on the damage. 2. Retrofits protect a building’s cash flow: Structures that withstand the force of a major earthquake are able to continue business as usual. That means tenants will be able to continue to live or do business there without any disruption to the income generated from that property. That means you can continue to collect rent if your building is still standing. If your building is retrofitted and in Los Angeles, you will be able to add a rent increase to help pay for up to 50 percent of the costs of your retrofit. This is an important point because you will still be required to pay on your mortgage even if your property is red-tagged. 3. Retrofits guard against demolition costs: If your property BUILDING OWNERS DRAGGING THEIR FEET ON SEISMIC RETROFIT LAW By Ali Sahabi, Optimum Seismic Local and State Update