Your Ounce of Prevention
- Sep 01, 2011
By Diane Mosher, Editor-in-Chief
We were watching TV one evening in August during a heavy rain storm, and the quality of the transmission was erratic. Just as we were fearing the power might go out, the bad weather cleared up. Intense summer showers in New York City are nothing new. But these days a mild summer rain can quickly turn into a much more serious weather event; for example, I don’t recall tornadoes touching down in the Northeast with such regularity 30 years ago. Clearly the intensity of the rain and wind—and the damage being done—are in a different league than a decade ago. In fact, we later learned that the same summer storm that had interfered with our television viewing had deposited tennis ball-sized hail in other parts of the Metro New York region, breaking windshields and damaging property. So, while we know that weather patterns are changing, we don’t know when or where disaster will touch down.
The violent 2011 spring storm season saw the deadliest single tornado since the National Weather Service began keeping records in 1950. Now hurricane season is here. Are your properties prepared? Having a recovery plan in place is more important than ever before for multifamily owners and investors. This month, MHN takes a look at disaster recovery plans (“Avoid a Multifamily Meltdown,” page 30). Prepping the property management team and residents can greatly impact how well a multifamily community is able to bounce back from a worst-case scenario. Our guest columnist from InStar Services Group shares steps that need to be included in a “pre-loss” plan, as well as action items that will drive the success of your post disaster recovery efforts. Given the unpredictability of the weather, it’s a good idea to reassess your portfolio’s insurance coverage—and don’t overlook flood insurance. This is a common mistake that some multifamily investors in New Orleans regretted after the failure of the levees.
It’s now been six years since Hurricane Katrina, and New Orleans is still a work in progress. MHN Managing Editor Erika Schnitzer’s Market Report (“Downtown Renaissance”) looks at investment opportunities in this Gulf Coast city where new product has spurred a renewed interest in downtown living. According to one source, the product pre-Katrina was very tired, especially in the city core. However, since the disaster, the city has been able to generate new mixed-income developments that are having a positive impact and changing the face of the rental inventory.
The failure of the levees was a man-made situation waiting to happen. Other man-made disasters occur on a much smaller scale and might impact just one or two rental units at a time: like the renter who damages the kitchen by starting a cooking fire or accidentally overflows the bathtub. That’s where renters insurance steps in to help. This month’s Property Management feature (“Shielding the Asset”) explores the challenges surrounding renters insurance when so many residents are feeling the effects of the soft economy. Here, too, an ounce of prevention is worth a pound of cure. Hopefully you’ll never need to implement your disaster plan, but doing a test run to make sure all action items are covered is not a bad idea.