Page 14 - NBIZ MAGAZINE December 2021

and NOI increases. So, for a property with a market Cap can achieve higher rental rates and/or higher occupancy
Rate of 5, decreasing water expense $1 would yield $20 of and thus higher market value of the asset. The implemen-
increased asset value i.e., $1 / 5 % = $20. tations of some ECM’s (Energy Conservation Measures)
If you are spending $10,000/month on water expense are difficult to justify because they do not generate a fast
or $120,000/year, just a 10% reduction in water expense enough payback to make good economic sense. Some
pushes an extra $12,000 to the bottom line or NOI. This energy efficiency improvements have improvements that
immediately increases the market value of the property have fast payback but most property owners have already
with a 5 Cap by $240,000. done those. Some affordable water efficiency improvements
generate quick payback and make good sense today. These
Conserving Water include low-flow toilets moving from the old models that re-
Being good stewards of natural resources remains a good quired 2.5 gallons per flush to new ones around .8 gallons.
practice for the simple reason of not being wasteful. Many Showerhead restrictors that lessen the flow and aerators
businesses track usage and set goals to reduce their usage on sink faucets also help reduce the amount of water used.
by a specific percentage each year. Still, others set even There is also some new (or at least not widely known)
higher goals or standards for usage reductions that organi- technology, known as adjustable water flow management
zations such as the US Green Building Council (USGBC) tie devices that produce savings in the 20% range with a fast
to different well-defined levels of certification. These are the payback. These prevent water meters from falsely reading
folks who created Leadership in Energy and Environmental air as additional water and overstating your bill. Since air
Design, (better known as LEED). If you are a property owner naturally expands when there is a pressure drop (which
who has not yet developed a concern for such things, one occurs inside water meters) we are all buying a lot of air in
should because tenants prefer and even insist that the build- our monthly water bills.
ings they lease maintain these certifications. If an owner
completes these certifications, they will have a larger pool of Independent Engineering Verification
potential tenants interested in their building(s). To ensure those making claims about efficient prod-
ucts, services, and the properties using them are being FIRMLY ROOTED IN TEXAS SINCE 1999
Water Costs are Skyrocketing truthful and realistic, ask for reference letters and case
It is no secret that water costs have been increasing studies (showing specific numbers and calculations) from TAILORED PARTNERSHIPS WITH CUSTOMIZED SERVICE VALUE
at an alarming rate. Droughts, decaying infrastructure, people who have used the product. Even better, look for
inflation, and areas like Houston that are shifting from Independent Laboratory or Third-Party MEP (Mechanical,
well water to surface water all contribute to rising costs. Electrical, and Plumbing) Engineering Verification and
According to The Circle of Blue, a not-for-profit water Validations of the claims and product effectiveness.
advocacy group reports that national water rates have in-
creased 54% in the past 10 years. Mayor Turner has been Conclusion
warning Houstonians for months of the need to dramat- Over-paying for municipal water and sewer impacts
ically increase water and sewer rates in Houston. He has nearly everyone. As a former Asset Manager, myself, I
said there will be significant increases each year for the have over-paid thousands of water bills to the city because
next five years. Those increases have now been formally I didn’t know this problem existed. Even today, very few
approved and are beginning to take effect. For an average talented and knowledgeable property managers and
single-family home using 3,000 gallons per month, they owners know about this problem/opportunity. Look for
will see a total increase over the next five years of 78%. an adjustable water flow management device as a solution Instead of globalization and assimilation, United Protective offers a family-owned Texas brand with successful
that reduces water usage (and more importantly for most)
Sustainability Metrics reduces the expense for water and sewer. This is true for partnerships. We deliver the highest levels of industry performance and tailored security programs identifying
As mentioned above, conserving water is a positive single-family homes to large commercial and industrial your facility needs with local branch support. Our vision is for long-term partnerships, with excellent cus tomer
choice all on its own. But raising the bar to achieve indus- facilities. The savings, typically in the 15-20% range, service, treating you as more than just another number on a revenue sheet.
try-recognized energy and water efficiency standards such is worth it by itself. And for owners of investment real
as LEED Silver, Gold, or Platinum, opens your property estate, properties like apartments, office buildings, hotels,
up to a bigger group of potential tenants, who typically etc. the reduction of Operating Expenses translates into
are willing to pay extra for such industry or globally increased NOI and market value of the property. N
recognized metrics. So, by reducing utility usage, one
Tim Crockett is a real estate veteran who has spent 800-525-6700
decades developing, leasing, managing, renovating, united-protective.com
and financing numerous commercial projects. Now as
President/Global Distributor of SmartWaterValve.com
helps property owners reduce water use expense to
increase NOI, Portfolio Value, and Sustainability. Tim is
also the author of “Water Cents” on LinkedIn. He can be
reached via email at tim@smartwatervalve.com.
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14 NBIZ ■ December 2021 DALLAS HOUSTON SAN AUSTIN FORT OKLAHOMA FRISCO
ANTONIO WORTH CITY