Case 01-3: Tenant Improvement Project

The following is a summary of visitor responses and comments on the case study presented on the Web site between December 2001 and April 2002. It is intended to be a factual portrayal of trends and individual comments without editorial input from EERI staff. Note that also responses were received on a completely anonymous basis.

Review The Situation:

ABC Engineering has been contracted to provide design services for a telecommunications tenant improvement project within leased space on one floor of an existing building. The building, a 12-story office building constructed in the 1960s, has been in an ongoing transformation into a "telco hotel" in which office tenants have been slowly replaced by telecommunications and internet equipment.

The scope of work for ABC Engineering is to evaluate the capacity of the existing structural framing to support new equipment and to provide designs for equipment support and anchorage. Although the site is located in a region of high seismic hazard, ABC Engineering has not been asked to perform any assessment of the building’s lateral-load-resisting system.

Included with the project materials that ABC Engineering has received from the client is leasing information from the building owner indicating that the building is a "hardened structure, capable of withstanding earthquakes without compromising the operations of prospective telecom tenants."

Based on a review of the construction drawings and a site visit, ABC Engineering determines that the building is a steel moment frame structure with the type of welded beam-column connections that were common for this vintage. It does not appear that any type of seismic upgrade work has been performed. At first glance, the lateral system appears to be fairly regular and redundant. However, the engineers are aware that older steel moment frame buildings have experienced damage in recent earthquakes. They understand that, in general, the past damage did not compromise the life safety of the building occupants, but excessive lateral deformations associated with this system could potentially cause serious damage to the telecom installations and disrupt the building services. (Note that the local jurisdiction has no legal requirements to evaluate or upgrade steel moment frame structures).

What should ABC Engineers do with this information?

Response Summary:

Most of the responses indicated that ABC Engineering should inform the client that the owner's performance claim might not be true and recommend that the client ask the owner for information to support the "hardened structure" claim. Some readers suggested that ABC offer to perform more detailed evaluations, that ABC recommend that the client not install the equipment before such an evaluation is performed, or that ABC ask the client's permission to directly question the owner about the performance claim. A minority of respondents stated that the engineer should not discuss his concerns regarding the seismic performance of the building.

Recommended Actions:

Readers were asked to rate several possible actions – considering the interests of all stakeholders – based on the following scale. The actions are listed in no particular order, and the rating for each action is the average of the ratings gathered.

5 — Strongly Agree 4 — Agree 3 — Neutral 2 — Disagree 1 — Strongly Disagree

a) Nothing. Seismic evaluation services were not included in their scope of work, and the building does not seem to pose an immediate or substantial life safety risk to occupants. Average Rating: 1.8 (min: 1, max: 5)

b) Inform the client of the situation and suggest that the client ask the building owner to justify their seismic performance claims. Average Rating: 4.5 (min: 2, max: 5)

c) Inform the client of the situation and offer to provide a more detailed assessment of the building (as an additional service) prior to informing the building owner. Average Rating: 3.6 (min: 2, max: 5)

d) Inform other building tenants that the seismic performance expectations set by the building owner may have been misleading. Average Rating: 1.6 (min: 1, max: 4)

e) Contact the building owner directly and ask for justification of the seismic performance claims. Average Rating: 2.3 (min: 1, max: 5)

Readers were asked what additional information would have put them in a better position to pick an alternative.

Based on the readers' comments, the following is a listing (in no particular order) of relevant information that would have assisted in making a better decision:

  1. Whether or not a prior seismic evaluation had been performed, and if so, what were the conclusions. Also, confirmation that a prior upgrade has not been performed.
  2. Background information to substantiate the owner's claim of a "hardened building."
  3. Client's performance expectations for the building and his equipment.
  4. Insight into how receptive the building owner would be to considering additional seismic evaluation and potential upgrades.
  5. Information on how sensitive the client's equipment is to story drift.
  6. Whether or not there are any life safety risks associated with the structure.
  7. Other background information including terms of the lease, insurance coverage, and soils reports.

Readers were then asked to offer a suggested course of action for the ABC Engineering. The following is a brief summary of the suggestions. As is the nature of ethical dilemmas, there is no right or wrong answer, and many courses of action could be considered equally valid depending on individual values and/or interpretation of events.

As can be seen in the response data, a majority of the respondents suggested that ABC Engineering informs the client of the findings and recommends that the client pursue the issue with the owner. The engineer should convey to the client that based on his preliminary review of the structural system, the building might not achieve the seismic performance objective indicated in the lease document. A common response indicated that "you have an obligation to the client to present all conclusions you draw from your work, whether they are in the scope or not." Similarly, "ethically [ABC Engineering] should advise the client about the potential for damage to the equipment." Then, according to one reader, "it is the client's responsibility to determine what actions are appropriate."

Some readers went even farther, suggesting that ABC Engineering discourage the client from installing the equipment in the building without verifying or improving the seismic performance of the building. Of this type of response, some suggested that the engineer ask the client to obtain from the owner supporting documentation for the "hardened structure" claim. Others would have the engineer offer to perform a more detailed evaluation of the building (for an additional fee).

Several respondents indicated that it would be important to discuss the seismic performance objectives to the client, distinguishing between basic life safety and enhanced objectives.

While many readers limited ABC's role to discussing results with the client, some would have asked the client's permission to go directly to the owner and ask about the performance claim. In addition, it may be reasonable to inform the owner of the concerns; according to one reader, "since I'd be telling my client of potential problems with the building, I think it's appropriate to inform the owner as well."

A minority of respondents (see data for action a, above), stated that the engineer should "limit [his] conclusion to the adequacy of the equip. supports and tell client that [he does] not take responsibility for building adequacy" because "that is what the contract called for."

Readers' suggested actions also included providing conceptual evaluation and upgrade scenarios or soliciting a contract to do so.

Comments on Question for Further Thought:

Finally, readers were asked to respond to the following question:

ABC Engineering identified the primary risk in the building as being loss of post-earthquake operation and damage to potentially expensive contents. Would your recommended actions have differed if ABC Engineering determined that there was a substantial life safety risk in the building? (For instance, assume that the building was a poorly configured, non-ductile concrete moment frame structure). If so, what would you have recommended?

As could be expected, the responses were mixed on this question. More than one respondent simply replied "No" to this question, while one response read "OF COURSE!!! If human life is at risk, I should advise the client and refuse any further participation in the project."

Most readers seemed to suggest that stronger actions would be necessary if a legitimate life safety risk were identified. Common recommendations were that both the tenant (client) and owner should be informed or that the engineer should discourage the client from even occupying the building (as opposed to discouraging simply putting expensive equipment in the building). Some would go even further; for example "if, however, there are lives at stake, the engineer has a further obligation to inform the authorities when the client or owner refuses to do anything." Others commented on a "threshold of perceived risk," beyond which "ABC has a public responsibility that transcends the typical client-consultant confidentiality responsibilities."

Some noted that in either case, the primary responsibility is to inform the client of the findings and go from there. "The obligation is to inform the client." Moreover, one reader noted that this "would not have affected my actions in any way, except that in informing my client of the potential risks, I would make it clear that life safety was a potential issue."