Facility Assessments

Any company with real estate holdings needs to prioritize regular facility assessments – the facility condition data collected during an assessment is invaluable to maintain facilities and their systems in peak condition, prolong the life of physical assets and bring stability to the capital planning process.

Full, periodic facility assessments can be very expensive for an entire portfolio of critical as well as lower priority assets. This expense is often challenging to justify for facility and building managers who must defend their requests for the needed funds to adequately support both preventive and reactive maintenance tasks.

At the end of 2017, the average U.S. commercial building was about 50 years old (49.83 years). (SMR Research Corp.)

Assessments are expensive and time-consuming. Inspection costs range from 8 cents per square foot to $1.50 per square foot, depending on the level of detail and degree of sophistication.

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The Cost of NOT performing Facility Assessments?

Maintaining older facilities has its challenges, but new or old, regular assessments of your facilities can be expensive. Conversely, not performing a regularly scheduled condition assessment is more expensive in the long run.

As Dan Geldermann and Don Sapp discuss in their article on Streamlining Facility Assessments:

• In an effort to reduce assessment costs, many organizations have increased the amount of time that passes between facility inspections by up to 5 years. Stretching the inspection intervals has mismatched the timelines for comparing facilities and installations within a large portfolio.
• From a field perspective, the unknown use of data by headquarters and a lack of any visible funding impact from submissions have fostered a lowering of priority on updating existing data.
• To further call into question the usefulness of DM for allocating resources, field inputs have become suspect at headquarters as resource requests for DM seem to ebb and flow with funding climates. When available funding is perceived, DM numbers quickly rise at installations anxious to get their share. Conversely, installations suddenly become well if potential closures are rumored. This has led to a credibility gap of reported results and an uneven playing field between field activities vying for the same resources.

The bottom line: not having up-to-date condition data makes capital planning and deferred maintenance budgeting difficult and escalating reactive work orders and their associated costs inevitable.

Kevin O’Leary opines (Keith O’Leary, July 2011, Area Development; Self-Assessment Benefits), and we agree, that budget allocations are usually tied to goals specifically attached to risk mitigation and business continuity. Even with this somewhat narrow view, sound decisions rely on having ready access to current and comprehensive facility condition data.
This data can pinpoint areas of increased risk and help Facility Managers and Directors set objective priorities during capital budget planning.

Are regular facility assessments worth the trouble? The average market value of a U.S. commercial building was $1.4 million at the end of 2017, up from $1.27 million from 2014.

Different types of Facility Assessments

Per Chuck McClain, facility assessments “identify and quantify existing conditions and provide a framework for future facilities management.” The types of assessments vary according to the reason for the assessment and the data required. Mr. McClain proposes six main variations of facility condition assessments.

Flagship Facility Services assesses facilities with an eye toward supporting long-term operations and maintenance planning and establishing a preventive maintenance program.

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Expect the best, but prepare for the worst: Reactive Maintenance

At first blush, expecting the unexpected, and even planning for it, seems like a losing proposition.

Facility Managers and Directors accept that emergency break/fix work orders are inevitable, especially in aging facilities. The goal though, is to reduce reactive work orders and spend most of your staff’s time on preventive maintenance.

Per Michael Cowley (Facilities.net), in the manufacturing world, where the majority of the work occurs in one or two co-located facilities, the goal is to reduce reactive work to only 10% to 15% of the facilities services workload.

In contrast, organizations with Class A campuses with a variety of environments or geographically dispersed facilities with substantial windshield time spent traveling between locations, the percentage of reactive work can reasonably be expected to easily reach 25% to 30% of total available manpower.

Self-Guided Facility Assessments

As an alternative to hiring a professional firm to conduct periodic facility assessments, organizations can turn to online, guided self-assessments.

These DIY assessments use several methods and platforms. Online surveys allow Facility Directors and Managers to have uniform data collection, visual dashboards of facility data and intuitive reporting features. The resulting “report” includes suggested condition remediations and estimated costs.

Among the benefits of these types of self-assessments is the ability to use the self-assessment tools for frequent, lower priority asset reviews and hire a professional for a full condition assessment (FCA).

Having current condition data available can make justifying a budget request easier for Facility Managers and Directors. For geographically dispersed facilities this is especially difficult, but a self-assessment is perfect for quickly building a case for a budget request.

Self-assessment tools also support frequent condition assessments. The frequency of the data collected can highlight “hot spots” requiring a professional FCA review. Per Kevin O’Leary, these FCAs account for approximately 15% to 20% of the typical portfolio.

Finally, regular self-assessments will help organizations keep their facilities’ data up to date. Regular reassessments of system conditions prevent information from getting stale and, more importantly, validates remedial action taken to address prior deficiencies.

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Next up: Reactive maintenance planning