But there's still the monitoring of the systems. "Failure to adhere to vacant building policy could jeopardize coverage," she said.Ĭouncilmember Scott Sherman asked if city staff could take over any of the functions handled by CBRE.Ĭaldwell said they were trying to determine if the security company used by CBRE could be hired. The policy requires members to conduct periodic inspections, secure the perimeter, and address maintenance issues. In 2018 the property committee adopted a vacant building best practices policy to limit losses to empty buildings, which de Muro said are "uniquely susceptible to perils such as fire, vandalism, and theft." That, in turn, could affect insurance on the former Sempra Energy headquarters that now needs an estimated $115 million in repairs.Ĭlaudia Castillo de Muro, the deputy director of risk management, said the property is covered by Prism, the joint powers authority that provides insurance for most of the city's portfolio. Sanna Singer, assistant city attorney, reminded the council of another risk in excluding it - a breach of the lease requirement for a third party property manager. "The homeless population could easily get into it." Security is critical with an empty building, "particularly a large one in the middle of downtown, an easy target, she said. "Even though Ash is vacant," Johnson said, it's important to maintain property management to protect it, "regardless of what we ultimately end up doing with that building."
The company had threatened to drop services for all three buildings if Ash were removed, or the city didn't agree to "spread the cost" for managing just the two properties.Ĭouncil president pro-tem Barbara Bry, who made the motion to drop Ash - and the full cost of its management - called CBRE's response "blackmail."Īsh St.'s share of the contract was about $311,000, which Karen Johnson, asset manager for the city's real estate department, said would keep two building engineers on site, maintain the systems and provide 24/7 security. If something happened to it while the property management agreement was in place, the liability would fall on CBRE, Caldwell said. for over 25 years when the lease began in 2015. The city chose CBRE, which had managed 1200 Third Ave. If a fire broke out or a pipe burst in the night, "we would still need to respond."Īll of the buildings have lease-to-own agreements that require the city to hire a third-party property management company.
"We are still in possession of the building although not physically occupying it," said deputy chief operating officer Erik Caldwell.
and raising questions about the city's liability in the event of a loss. 15 the city council made a change to the terms of the agreement, dropping Ash St. It's time to renew the contract with CBRE, Inc. And the city has dropped it from property management services.
Vacant buildings are at high risk of vandalism, fire and theft. The city has stopped paying rent on 101 Ash St., but the asbestos-riddled building has sat empty for months, posing a new problem.