Risks to your vacant property: Prevention being better than cure!

Transcription

1 Risks to your vacant property: Prevention being better than cure! 15th June 2017 James Fee Protecting, managing and monitoring Europe s vacant property and sites

2 Agenda The Challenges of Vacant Buildings & Case Studies Mitigating the Risks Preventative Solutions Summary

3 The Challenges of Vacant Property Water ingress, flooding, burst water pipes Fire/Arson Fly-tipping Vandalism and theft Squatting Trespassers/Urban explorers/travellers Illegal raves/trading Unauthorised use of land and property Third party liability risk

4 Water ingress, flooding, burst water pipes 1 in 6 properties are at risk of flooding from coastal, river and surface water (4) ABI estimate almost 500m cost of repairing flood damage from the winter of 2013/14 alone - an average per claim of 24K If a building is unoccupied without regular inspections & maintenance, there is a significantly increased risk of water damage, for example: from burst pipes, or a small water leak that goes undetected and becomes more serious 4. UK Parliament, House of Commons Select Committee, ttees-a-z/commons-select/publicaccountscommittee/news/report-strategic-flood-riskmanagement/ March 2015

5 Pub/Nightclub - Case Study Pub/Nightclub Roof leak undetected Weekly internal & external inspections were not undertaken Inclement weather caused additional burst pipes 250K damage Delayed sale for 6 months

6 Fire/Arson 60 fires a day occur in or beside vacant or derelict buildings (2) Home Office estimates construction firms in England and Wales are affected by 104,000 fires each year 40% of all construction sector fires are lit deliberately, equating to 11 fires every day, costing the construction sector 400 million a year (6) Why Empty building attract anti social behaviour Vagrants light fire s to keep warm Poor electrical condition of property Stolen vehicles dumped and set in fire in/adjacent to empty properties Arsonists perfecting their skill The net result is an increase in claims and increased premiums 2. Department for Local Communities and Government, latest published data: 6. Zurich Insurance,

7 Fire vacant retail unit Occupied by squatters No inspections since former tenant vacated Total loss of unit

8 Fly-tipping Fly Tipping Summary Statistics for 2015/16 936K 50m 936K incidents of fly pping ( 36K) Local Authorities spent 50m on clearing up 436K Highways most common contributes to 50% Fly tipping incidents rose by 7.9% on Highways to 436K cases 31% Small van load size fly tipping accounted for 31% of incidents 494K 17.6m 494K Enforcement actions Estimated cost of enforcement actions carried out by LA 16.9m Source: Dept for Environment Food & Rural Affairs 2017

9 Theft & Fly Tipping Industrial/Office Unit Waste removal alone 200k+ cost 24hr security required post loss discovery Extensive damage caused in course of theft Damage and fly tipping occurred over some 2 months; no inspections in this time Issues over alarm maintenance no activations

10 Vandalism and theft Over 40% of vacant commercial premises are subject to vandalism (1) Theft and vandalism costs the UK construction industry over 1 million per day (5) Which properties do metal thieves target? Historic buildings, especially churches Out-of-town retail units Vacant or isolated industrial units 1 Home Office: Crimes Against Business Survey Aug Zurich Insurance

11 Vandalism and theft Case Study Vacant Office Premises 80k metal theft, severe damage approx. 2m repair costs

12 Theft Loss former data centre Caused damage to electrical, life safety & aircon systems throughout Entry via roof light, perpetrated over a number of visits Premises used for storage by charity for rate mitigation purposes Occupants failed to set alarm or notice damage

13 Squatting Squatting or illegal occupation of commercial property is NOT a criminal offence Squatting became illegal in 2012 in residential properties As a result, many more commercial premises have been targeted since the law was passed, with an estimated doubling of legal proceedings against squats taking place. Thousands of squats and illegal raves are reported annually across the UK Estimated 20,000 squatters in UK Costs of removing squatters is on average 7000 in legal fees Costs of clearing up afterwards in on average includes clearance Needle sweeps/environmental clean Making good Re-secure costs

14 Case Study Squatting

15 Trespassers/Urban explorers/travellers Landlords have statutory obligations under the Defective Premises Act and Occupiers Liability Act where trespassers can sue landlords should they be injured within a vacant property There are around 300,000 travellers living in the UK, and contrary to popular belief, most live in housing However, approximately a 100,000 are thought to be living on the road or at sites (1) 28 days later website 1.

16 Case Study Urban Explorers

17 Illegal raves/trading Initially it will start off as a squat Large office/industrial/warehouse Online marketing by social media, no location revealed until day of event No health & safety no fire risk Result = Bedlum Aftermath costs of clean up can reach 100,000 plus Croydon Rave resulted in a death of a reveller still ongoing case

18 Case Study Hackney Rave Recently a small warehouse in Hackney hosted a rave Costs according to the owner were 500,000 in clean up, making good & potential lost revenue from being unable to let the property

19 Third party liability risk Under the Defective Premises Act 1972 and Occupiers Liability Act 1984, property owners have a duty of care to protect anybody who sets foot in a vacant property (including estate agents, surveyors, members of the emergency services, trespassers and vandals) from hazards or defects that might cause them harm. If somebody was injured, or a neighbouring property suffered damage, as a result of a defect in a vacant building, a legal claim could be made against the owner.

20 Mitigating the risks Carry out Site Risk Assessment Regularly inspected Security should be top priority Remove combustibles Owner to keep property maintained Letterbox secured Utilities are turned off and drained down

21 Solutions Physical Security Solution Pro s Con s Cost Security Guard Physical Presence on site Onsite response Can detect utility leaks quickly Steel security screens Robust Secured with security screws or secured internally Perforated to allow light in Do not deteriorate Removal of graffiti is easier Non flammable Costly Sleep Inclement Weather Cant protect whole site Appearance Advertises premises are empty Wooden Boards Appears secured Deteriorate and rot due to weather conditions Flammable fuel for arsonists? Prevents natural daylight entering the building. Advertise property vacant High capital expenditure Concrete Barrier Blocks Prevents vehicle access Can be moved if not secured correctly 1,680 per week per week window opening 80+ per window opening 10 per block per week

22 Solutions Technology Security Solution Pro s Con s Cost Alarms & CCTV Many eyes constantly vigilant over whole site Audible warnings (siren or voice) deter most unwanted approaches Response times depend on how quickly security or police can reach site Even with video, false alarms might occur Cost effective & efficient Not all sites can be secured by technology Modular technologies = adaptable Captures video evidence of any attempts to breach Combines with metal theft, water & fire alerts Can differentiate between genuine breaches & false alarms Police Response Alarm with sensors 150 per week CCTV Tower 200 per week

23 Solutions Guardian Occupation What you need to know about Guardians Guardians isn't a new concept, been around since 2007 Industry has move on and professionalised Currently c6000 guardians in living in vacant buildings Property occupied = Not vacant Occupied property is less risk than a vacant building Two key elements in service Building selection Guardian selection

24 Building Requirement Wind and Water Tight( I.E its got a roof) NICEIC compliant-electrical safety check CP12 /Gas safe certificate Water test- Legionella HMO compliant ( 5 or more Guardians) 1 shower per 5 people 1 toilet per 5 people all individual locks on doors white goods provided working fire system Fire alarm system in place or a wireless system installed to L2 standard L2 = Alarm in every living space and adjoining corridors to living space

25 Guardian screening Highest quality Guardians Employed earning> 16k British standard referencing Criminal record check Adverse Credit history check Identity check Guardians trained on Fire safety

26 Solutions Occupation - Guardians Guardian Solution Pro s Con s Cost Guardians Property Occupied Some insurers see guardians as an additional risk Mitigate Business Rates One month notice to return the building Generate revenue from guardians Perception of people living in a vacant property Commercial buildings cannot get squatted Additional revenue through parking & vending Fire risk assessment & extra fire safety Electrical & Gas Safe Buildings maintained Nil cost to client SmartAlarm Technology used to protect unauthorised areas Perception of some guardian occupiers 0 to 30K income per month for client

27 Summary Vacant Property Vacant Buildings are a significant risk & cost Risks Water, Fire, Fly tipping, theft, & squatting Solutions Physical Technology Occupation

28 Questions

29 Thank You Contact James Fee VPS Head of Insurance

30 FAQs What's the notice period How much will it cost What other costs are involved What happens if guardian don t leave when requested Who pays the rates/council tax Who pays the utilities Is the property on mine or VPS insurance How soon can you get Guardians What's the minimum period of Guardianship How are the rebates worked out Who pays for any damage to the property What happens if the property gets squatted