There is no doubt we are operating in an unprecedented economic environment. The majority of experts seem to agree we are in challenging times and businesses are feeling the pressure.
In many cases, availability of capital is limited and costly, despite government help. Property values have steadily declined. And every industry faces rising or fluctuating costs for commodities such as fuel, services, material and employee expenses.
“Gone are the days of short hold periods for buildings where capital investment was the exception, not the norm. In today’s recessionary market careful asset management is the key to survival,” said BOMA International Chairman/CEO Richard D. Purtell, portfolio manager for Grubb & Ellis Management Services Inc. “Property professionals should be implementing no- and low-cost energy efficiency strategies to reduce energy costs, benchmarking to measure and improve building performance, providing high value tenant services, and participating in affordable educational webinars and conferences to learn best practices in building operations.”
This challenging environment is taking its toll, and building owners and facilities managers must do all they can to ensure their operations stay healthy.
In the face of this difficulty, owners of commercial, municipal, institutional and industrial buildings are confronting capital and operating budget challenges.
They are seeking ways to cut costs without sacrificing impact on occupants and stakeholders, in most cases deferring all non-critical expenses; and they’re seeking ways to stretch the life of their building systems a little further. Sometimes such measures are taken to contribute to the bottom line; sometimes it’s a matter of survival.
“More than ever we are seeing building owners struggle with the choice of what to PM (put on preventive maintenance) and what to let go or take care of themselves,” said Jeff McCoy, chairman of the Mechanical Service Contractors Association. “These are difficult times and many people are paralyzed by that. We just counsel them to continue with performing their preventive maintenance and focus on the systems that are most crucial.”
The Risks of Deferring Maintenance
As you set your strategy for managing your building assets through tough times, it’s important to first consider what it means to defer all maintenance on your building systems and the reasons that it is not a viable option.
Delaying maintenance on your building:
- Increases the risk of unplanned breakdowns and the resulting steep emergency service expenditures.
- Increases the likelihood of making tenants and occupants uncomfortable when building systems falter. In the commercial real estate sector, when unhappy tenants move out it typically takes approximately 18 months to establish new tenants (think lost rent). And in the health care sector many organizations state that maintaining an optimum environment of care and high indoor air quality is not only required by industry standards, it’s part of their hospitals’ strategy to improve the health, safety, effectiveness and satisfaction of the health care team, according to the Center for Health Design, 2006.
- Increases the risk of having an unsafe and unhealthy environment. Good indoor air quality helps avoid sick time and potential employer liability (U.S. Environmental Protection Agency. And it increases productivity by up to 15% (U.S. Green Buildings Council).
- Degrades the efficiency of your building systems, which increases energy usage and costs over time. Because energy is the single largest operating expense in most non-manufacturing buildings and can be up to 65% of an organization’s total operating budget (ASHRAE), any costs avoided through energy efficiency measures can be significant.
- Decreases the lifespan of your equipment so in the long-run you don’t get the full return on your initial investment.
It’s clear that deferring maintenance is not advisable, but challenging times call for extraordinary measures.
In times like these creativity is required to ensure your business survives in the short term so it can thrive in the long term. Sound businesses are positioning themselves to be poised to take full advantage when the economy makes an upturn.
A Strategy for Building Owners in Tough Times
Building owners with limited resources who are forced to “make do” with their current infrastructure have a number of strategies they can employ to ensure uninterrupted building services, even in trying times.
A process that includes the following steps will help ensure that effective solutions are identified and executed. These are the recommended steps to building a recession-proof maintenance plan for your building, whether it’s a hospital, office building, school or factory: (1) Understand the current state, (2) Assess overall risk, (3) Prioritize areas of risk, (4) Analyze critical system requirements, (5) Understand stakeholder requirements, and (6) Identify solutions for your situations.
Understand the Current State
To gain a clear understanding of the current state of operations, audit your critical systems. This may be part of your service agreement with your service provider, manufacturer or installer already. A comprehensive building systems audit by a professional will tell you how well your building and systems are performing and help identify any specific areas of vulnerability.
Assess Overall Risk
The information gained in your audit, paired with your knowledge of the building’s uses and the occupants’ needs, will help you assess what risk a system failure might pose. The phrase, “what if” at this stage highlights the level of criticality. Here are some examples:
- What if the air conditioning system begins to falter in August and the resulting high temperature and uncontrolled humidity in this Texas plant ruins an entire production run of medications?
- What if the aging heating system finally gives out in this Minneapolis school in the middle of January during final exams?
- What if the dehumidification controls serving the operating suite in this Florida hospital fails in the middle of the day when every operating room is full and sterility standards for the operating rooms are breached?
- What if the air conditioning capacity fails to “keep up” with the cooling load on this expanded data center full of servers that hold the production data for this entire company and must be kept at a constant 68 – 70 degrees Fahrenheit?
- What if the ventilation system in this 47-story office building in New York City falters and the 2,500 people who work here can’t open the sealed windows to get a breath of fresh air?
These are real scenarios and their criticality is clear. System failure is not an option in any of these instances.
Prioritize Areas of Risk
Knowing the overall risk and the vulnerabilities of your system, as well as your stakeholders’ needs, will help you identify and prioritize the areas of greatest risk.
Those components of your system that can cause total system failure obviously take top priority. For example, the operating suite’s dehumidification control can fall out of calibration, so recalibrating and validating it would be a top priority; more important than greasing a few small motors that power a single compressor.
Analyze Critical System Requirements
Consider which risks you can assume based on the expertise of your staff, and identify those of a highly technical nature that you may need to outsource and assign the tasks accordingly. Then rank those activities that will mitigate risk in the areas of greatest vulnerability to your facility and focus your efforts there. Industry-leading OEMs can provide a method and template for performing critical systems surveys and analysis.
Understand Your Stakeholder Requirements
Take the time to listen to your stakeholders and understand what is specifically critical to them. What are their concerns? Teachers in Minneapolis want their students to pass their final exams so everyone can go on their winter break and be ready to start the new semester in a week.
Identify Solutions for Your Situation
Now is the time to ask, what can I do to make sure my boiler doesn’t fail at a bad time, or my air conditioning system doesn’t begin to falter during peak cooling?
Your initial audit of critical systems will highlight any possible upcoming issues or physical vulnerabilities with any of your building systems.
Be sure to work with a skilled service provider to assess system health, maintain spare parts inventories, and perform routine inspections so you know when to replace or repair worn parts before trouble might occur.
If you have a limited budget and must choose between making one of several repairs, focus on the components that could cause the most secondary damage, should they break.
Implementing Solutions for Maintaining Your Building
Setting a strategy and defining a solution to maintain your building during a down economy is a bit like cherry-picking the best practices from tested predictive and preventive maintenance programs. So here are some ideas inspired by the best programs in the country:
- Plan. Draft a plan that includes fuel purchasing and equipment replacement as well as the original equipment manufacturer’s recommendations for proper maintenance.
- Benchmark. Early documentation of system performance promotes sustainable performance.
- Staff and training. Appoint factory-trained technicians that can use state-of-the-art service methods and factory-developed standards.
- Document. Conduct regular review sessions to keep documentation up-to-date and to assess any adjustments that need to be made to the HVAC system.
- Assess. Determine if HVAC systems are adequate for supporting present and future operating needs including capacity, reliability, efficiency, risk and expanded production.
- Control. Maximize the use of building automation systems to operate in the most energy efficient manner possible.
- Schedule. Determine the frequency of maintenance based on operating conditions, hours of operation, critical nature of systems and operational considerations.
- Maintain. Establish a maintenance program that will mitigate risks and assist the facility in the management of its assets.
Taking Responsibility for Simple Tasks Can Save Cost
Consider what work your maintenance staff might be able to take on themselves. Maybe they could perform some of the more basic maintenance tasks such as regular lubrication of the moving parts, visual inspection of the mechanical systems and documentation of system performance. Also, other daily tasks to validate performance are helpful.
Building owners and facility managers can develop their own effective maintenance program using the following steps:
- Develop a master facility equipment list.
- Determine the recommended maintenance activities by referencing manufacturer technical manuals and equipment operating histories.
- Establish a maintenance schedules using OEM input.
- Conduct a complete critical system evaluation, or energy audit, to determine if systems are adequate for existing and future operations.
- Prioritize needs based upon facility requirements and strategic goals.
- Identify internal tasks that can be effectively be performed by operations and maintenance personnel.
- Create a documentation process to establish baseline maintenance levels and to which you can compare subsequent snapshot performance inspections.
The current economic climate may be daunting to some, but that shouldn’t keep anyone from appropriately managing any possible risk to their business or their assets. Resources are tight, but many options exist for addressing your building’s needs and for investing in efficiency measures to increase your building’s future value.
