Commercial Real Estate
Commercial real estate has been one of the most popular avenues for building wealth for centuries. People love to own properties, and for a good reason. If functioning correctly, thousands, or even millions, can be made in the industry. For this income to be realized, and these ventures to be profitable, the properties need to be structurally sound. If the properties are not structurally sound, their earning potential is severely limited. If they are not standing, they will not be able to support an in-place renter or attract a potential future renter. Without a tenant, you will not collect rent. Therefore, once viewed as an asset, the property will have no income and turn into a massive liability with tax bills, insurance bills, and maintenance bills still coming due. In the Southeast United States, we have some of the most challenging ground and soil elements in the country. In particular, Florida and the areas around it are unusually challenging, before we even mention the risks associated with natural disasters like hurricanes. In a state with some of the most brittle ground elements in the country, we often take a standing and functioning structure for granted, especially in Florida, where sinkholes are prevalent, and soil shifting can collapse your building in the blink of an eye. People too often forget that a building will not stand up by itself. It is supported by foundations and various items that keep structures standing and prevent them from tipping over from light wind or a major storm.
Building in the Southeastern United States
In the Southeast United States, structural support is as essential as any other location in the world. Often the property is built on top of sand or ground that has erosion issues. Why is this? The answer is karst and the resulting sinkholes from this phenomenon. Both karst and sinkholes are naturally occurring geologic forms that take shape due to erosion, which is usually natural but periodically manmade. Karst is not unique to the Southeast United States; it appears worldwide in areas where water erodes soluble bedrock.
The erosion creates caverns, caves, and other fissures, which put more pressure overtime on the surface above, whose soils and other elements need to support themselves and whatever is above it (often structures) while not collapsing into the gaping hole below. In the United States, karst is present in every state and territory, even the far-flung areas of Hawaii and Alaska. With karst comes erosion, and with erosion comes sinkholes. Therefore the entire country (and most of the world) needs to be aware of this risk and deal with it. These phenomena can be extremely costly in the form of property damage, societal interruption, economic impact, and even losses of life. Unfortunately, current and recent sinkhole data are far from adequate. Many administrations locally and nationally have ignored the substantial need to track, prevent, and prepare for this phenomenon’s current and future effects. There is no existing unified database of any kind; instead, we rely solely on sporadic data from agencies throughout each state and country. Many of these agencies are volunteers or are focused on other avenues. Therefore much of the data is poorly organized, sporadic, not focused enough, or not trustworthy.
While Karst terrain can be found throughout the United States, in 16 of the 50 states, 25% or more of their grounds are composed of underlying conditions containing karst topography. The national extent of the karst landscape can be seen in orange in the figure above. Unfortunately for us, the Southeast United States is no exception to this rule and is, in fact, much more affected, as illustrated in this map. Of those states affected, Florida sees the most risk. The state is covered in more than 81% of karst topography, the highest proportion of any state in the country.
Given that the state is also the third most populous state, with 6.31% of the country residing in the state, it has a much higher probability of people being affected by these soil conditions and sinkholes than other states. It is also much more costly. Sinkholes are estimated by the United States Geologic Society (or “USGS”) to cost upwards of $ 300 Million annually. Florida accounts for around one-fourth of this cost alone, without including its neighboring southeast states. This figure is more than likely much higher, with tracking damage of this type minimal and unorganized.
So how do we deal with this? There is no perfect answer as the solution will be custom to both you and your property. Properties need to be evaluated based on location, construction, weight dimensions, and others. Client projects need to be assessed based upon their risk profile, affordability, and ability to deal with any current or potential future risks. Our team at Florida Engineering will put together a custom plan for you so you can rest easy knowing you are safe and taken care of. The first step we will take will be to understand your needs. Yes, your needs, not only your property’s. One property owner’s goals and capabilities will not be the same or identical to the next one. We need to understand your goals with the property and why. Are you buying a property as an investment or for your own business to occupy? Is this a dream location for a particular reason, such as invaluable logistics, irreplaceable nostalgia, or is it merely likely the right property at the right time, when you could simply replicate this location anywhere else locally? From there, we also need to understand what you can or cannot afford financially. Seemingly no one can truly afford a massive accident caused by a sinkhole event or other structural issue causing a building collapse or unforeseen major repair as major repairs and rebuilding both come with high costs. That said, what you can afford now and periodically will differ from your peers. We need to know what this looks like and why. Your financial capabilities will allow us to determine how prepared we can make you now and in the future.
Our upfront preparation program will allow you to take strong preventative measures to avoid major unforeseen accidents. We will start with a typical property inspection. For properties with existing structures, we will look for the most common signs of an active or upcoming sinkhole issue:
Property Perimeter Review
Exterior walls should generally be straight and not tilting, both up and down and side to side. To review the exterior walls, stand at the end corner of a wall and look down it horizontally and vertically. Noticeable leaning or bulging should be examined immediately.
Look for Cracked Concrete
Concrete is foundational to many properties and a strong indicator of the structural strength of a property. Concrete cracks inside or outside the structure may sign structural or soil issues for your structure. If present, unstable ground or expanding and contracting of this soil can pressure the structure and/or its foundation, setting the stage for issues. Note concrete cracks are very common. Smaller hairline cracks may not be an issue; however, larger, more apparent cracks require inspection.
Initial Slab Tests
Initial slab probing can be completed very quickly, requiring nothing more than walking around the property with a small tool. A visual review of a property followed by a few jabs at the foundation will be very telling about the site’s structural status.
Just like slab testing, wood testing initially can be completed with minimal tools and a quick review. A small handheld tool will allow our professionals to chip away small pieces of material in strategic locations to show water infiltration, microbial growth, and other damage if any.
Crawl Space Review
Crawl spaces will show you a great view of the home supports, the soil below the home, and perimeter walls. For properties without crawl spaces, it is ok. Other property evaluation techniques will allow us to put together a robust assessment.
A review of a basement area will tell the current and future condition of the structural elements of a property. A basement review is very similar to what you look for in concrete slab review and crawl space review. The review as a whole and the conclusions will be very much the same. In particular, the supports and foundation need to be reviewed.
Indoor Walk Through
There are a variety of signs of structural issues to look out for in a walkthrough. These signs include tile cracking, drywall cracking, window issues, doors all of sudden not fitting frames, and many others. Some of these items can result from other causes such as settling, poor installation, or other elements. In other cases, these will be signs of major existing or impending issues.
In addition to this review of existing structures, we will review the general grounds regardless of whether a structure is present. The following items are extremely telling as to whether or not there is an existing or impending issue:
- Round circular depression in the earth
- Localized depression (an area that has dropped down noticeably relative to the land around it)
- A circular lake filled or filling with water
- Road / pavement cracks
- Foundation settling: showing a structure dropping and/or cracking
- Monitoring of on-site or local wells showing a large drop in water levels, indicating a sinkhole opened nearby where the water rushed into it
- Opening in the ground where large amounts of rainwater seem to disappear into
Solid, well designed, and built foundations need to be in place to keep your properties standing. All buildings require a strong foundation, but this need is even more significant in Florida, where the risk of major storms and other weather effects are a regular occurrence. Even the best materials with the most qualified professionals can see incidents of failure. The incident could be caused by a major underground event, a storm, or simply a faulty manufacturing element out of the control of anyone involved in building the actual structure. These incidents can lead to costly structural failures or even entire structural collapses. To make these situations worse, they involve outside clients and tenants. Tenants expect prompt service and prompt resolutions. Not only will your business be interrupted, but so will the homes or businesses of others, and they will let you know it. Professional, swift action is required to keep all parties happy and working together in the right direction. Who do you turn to in these significant events? The answer is your insurance company and their retained outside professionals.
Remember that insurance agent that was friendly and easy to work with when you paid money and signed up for a plan? You need to make sure they are the right professional when challenges present themselves. Will they still be there – as accessible and friendly when you are filing an insurance claim as when they collected your check? With our team, the answer will undoubtedly be yes. We pride ourselves in taking the good with the bad and in meeting all challenges head-on. We do this through a custom property evaluation process for every one of our clients. We will assess your specific needs by evaluating your company, your tenants, and property in a top-to-bottom evaluation process. In particular, we provide inspection services before, during, and after major catastrophic events. Our team’s process will take preventative steps to avoid making an already tragic event worse. In addition, we provide custom streamlined approaches to immediately offer a safe scenario while also beginning the process to support your claims needs, which will give our clients the ability to finalize their claims process as soon as possible. Financial claims can quickly lose their value to the individual filing the claim if it takes too long to process. The solution can sometimes be worse than the process itself, which often has to do with the professionals involved and whether they move efficiently. Our team only hires fast-acting professionals. It’s in our DNA. We will move as fast as possible to benefit all parties and put an end to a challenging process before you know it.