Leveraging tech to prepare businesses for future natural disasters
Insurance, continuity planning, and improved resiliency can all benefit from technology.
The projected damage for Hurricane Helene before it made landfall was a few billion dollars. However, after the storm, Moody’s estimate was $425.9 billion. Now Hurricane Milton is headed toward Florida’s west coast and expected to make landfall Wednesday evening. In short, the potential risk natural disasters pose to structures is massive and growing.
There are ways of addressing this in an unexpected future, like insurance, continuity planning, and improved resiliency. All of these and more can benefit from technology.
Start with planning and documentation. Any business, including one in commercial real estate, needs to plan what it will do given different scenarios. Power loss, flooding or drought, wind damage, earthquake, fire, riots — there are so many things that can go wrong. A smart business considers what could go wrong and then knows the potential of it happening. Plans should be documented, and this is where technology first comes into play.
Keep contacts that might be needed, including lists of contractors, emergency service providers, and others. Those plans, all the information, should not be only on a computer in the building. Have cloud storage and keep companies with all the details, currently updated, safely there. Also, all information about lenders, loan documents, deeds, and other important documents.
Part of the planning is insurance, For a CRE company, that means details on each property. Images inside; drone video outside; details of original costs; up-to-date valuations; any additions or changes, particularly those that were done to improve resilience after consultation with insurance representatives and consultants with expertise in the area.
Resilience is important. That requires identifying potential threats in advance and then implementing property changes and processes that can reduce issues. Work with tenants to identify where they might have greater vulnerabilities. A company working with heavy machinery might want to move it to upper stories of a building to make it less likely for floods to damage it.
Sensors, monitors, and remote cameras can let you check remote properties. Some equipment can detect flooding (even shutting off water if necessary), fire, smoke, carbon monoxide, HVAC problems, electrical outages, and security issues.
CRE companies and their tenants should also consider continuity planning. It is possible to have people work remotely from safe sites, switch computer systems to operate out of other locations and tie communications together from multiple sites. Having extra inventory in remote locations or housed at a fulfillment facility can mean the ability to fill critical or common orders.
Not only is this a wise move for a CRE company itself in case offices face a disaster, but for the tenants as well. The more risk they can identify and mitigate — staying in business during trouble — the less loss they face and the less pressure on the property owner to take on.