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SECURITY COMPLEX

Mixed-use projects make the security guard’s lot a busier one

By Joel Groover

Colorful brochures for mixed-use communities accentuate the positive with sunny phrases like “vibrant social hub” and “active urban landscape.” Behind the scenes, however, security experts tend to dwell, not on sanguine scenarios drawn from the canons of New Urbanism, but on the possibility of a shadow side to these complex projects. The onus is on them, for example, to be realistic about whether “redevelopment district” is another way of saying “crime-ridden neighborhood.” Or about whether an intimate courtyard tucked away in an architectural drawing might double as a perfect hiding place for muggers.

A bike path is indeed a way to form connections between communities, but what if that thruway leads to a neighborhood where drug use and prostitution, rather than cycling, are the most popular forms of “recreation”? Shared parking formulas, which assume residents, shoppers, office workers and entertainment seekers will use garages at different times, may create a convincing rationale for building a smaller parking structure. But what if bar and restaurant patrons unexpectedly fill up that deck, forcing condo owners to park down the street after midnight?

These are the kinds of questions owners, managers and security and liability experts must confront as they contemplate security strategies for the next generation of live-work-play communities. “It’s an unfolding story more than something where there are a lot of conclusions at this point,” said Steven W. Sachs, senior vice president and managing director of the national real estate practice at Hilb Rogal & Hobbs, a Glen Allen, Va.-based insurance brokerage. “My bet is that, unfortunately, solutions in some cases will evolve based upon experience. You know, sometimes things happen.”

Still, the goal is to foresee and prevent all major security incidents. Failure to do so can carry severe consequences. For one thing, crime victims are increasingly likely to sue property owners and managers for security lapses, experts say. The U.S. has seen a steady rise in security-related litigation over the past 20 years, says Stephen G. Bushnel, a product director and commercial real estate specialist at Fireman’s Fund Insurance Co., Novato, Calif. Between 1983 and 1992 the U.S. insurance industry handled an average of 26 security-related claims per year, Bushnel says, with the average settlement coming to about $500,000. From 1993 to 2002 the average number of claims more than quadrupled to 109, with the average settlement doubling to $1 million.

Lawyers are staying busy, in fact, all over the world. Commentators from nations as diverse as Egypt, India, Ireland and Zimbabwe lament that their countries now rival the U.S. for the title of most litigious.

The presence of apartments or condos automatically makes mixed-use projects bigger targets for lawsuits than suburban malls, says Bushnel. “Building owners or managers have greater responsibility toward people who are their residential tenants, primarily because of the 24-hour exposure,” he said. “The courts will hold them to a higher standard than they will the owner of a shopping center.”

In fact, U.S. courts expect the owners and managers of residential properties to stay informed about crime rates in surrounding neighborhoods. “You have the duty to protect your tenants against all foreseeable events,” Bushnel said. “If something happens two blocks away, the law would consider that a foreseeable event for your own property.” And even as they track crime statistics and cull police briefs from local newspapers, mixed-use center professionals must stay informed about how their competitors protect residential tenants. In the event of a lawsuit, “if there are other multifamily or mixed-use properties in a neighborhood that are taking security to a higher level, you might fail a community standards test,” Bushnel said.

Managing risk in real estate is like a game of hot potato: Developers toss the risk to property management firms, which then pass it along to third-party security contactors. And everyone, of course, tries to fling it off to the insurance companies. When it comes to complicated mixed-use projects involving a jumble of development, ownership and management entities, the game can get particularly tricky. “There are lots of different types of liability you may end up with, depending on the legal structure” of the real estate agreement, Sachs said. He urges clients to negotiate clear lines of responsibility early on, but cautions that the so-called deep-pocket rule — the tendency for lawyers to hedge their bets by including as many wealthy defendants in a suit as they can — makes legal risk hard to rule out.

Even if general-liability insurance policies, some of which carry deductibles as high as $1 million, cover the cost of settlements and legal fees, a horrific crime like the abduction of a shopper or a child could cause far-reaching damage to a mixed-use property’s reputation, says Norman D. Bates, president of Bolton, Mass.-based Liability Consultants.

Indeed, the universal mantra for property managers everywhere — “clean, safe and secure” — is particularly critical for mixed-use projects. It is one thing to shop at a property where news crews are doing live remotes about a string of burglaries. It is quite another to buy a condo or rent an office there. Moreover, urban settings inevitably make some tenants and visitors jittery about crime. “A lot of nice properties are being developed on the fringes of central business districts that were once difficult, questionable areas,” Bushnel said. “We’re seeing that in every big city around the country.”

Those jitters are part of the reason security decision makers strive to create a reassuring atmosphere at mixed-use projects. Common practices include keeping lights on 24 hours a day, installing strict access-control systems and putting security cameras and emergency call boxes in highly visible locations. “One of the things that we try to convey to people who come onto our properties is that security is here and it is available,” said Vincent S. Hill, vice president of corporate security and safety at Forest City Enterprises, which has developed mixed-use properties since the early 1980s. “We provide escorts and have 24-hour patrols in the event people need assistance. This also helps create a deterrent.”

Different uses require different levels of security. Condo towers and office buildings should feel tightly controlled and monitored. Retail areas and public plazas, on the other hand, need to convey both security and openness. What specific security technologies should be used to strike this balance? How should parking work?

Developers may be too late if they try to tackle such considerations amid the noise of bulldozers and the stress of construction deadlines. Security experts say they routinely catch major blunders, such as the absence of a surveillance control room, in final architectural drawings. “All of a sudden your garage is built and no one thought about, ‘Well, how are we going to separate the retail shopper from the condominium resident?’ ” said Gee Cosper, a security consultant in Baltimore. “That is not the time to start thinking, ‘Where are we going to put the gates?’ ”

By asking their architects to study the CPTED (Crime Prevention through Environmental Design) principles taught by the International CPTED Association (www.cpted.net), developers may escape the need for costly retrofits, says Jonathan Lusher, senior vice president of consulting and inspectional services at IPC International, a shopping center security firm. Using the principle of natural surveillance, for instance, an architect might design a public plaza with so few visual obstructions that anyone with evil intent would feel watched all the time. The glass-walled stairwells and elevators built in some parking decks are another form of the same idea. Such methods can help lower long-term liability risk and reduce reliance on expensive security systems, Lusher says.

Experts say the good news about providing security for mixed-use environments is that many of the tactics long in practice at single-use properties still apply. The security team at an office building in a mixed-use project will operate the usual sign-in desk or badge system and will be trained to deal with workplace violence and to spot “creepers” intent on raiding cubicles and stealing laptops.

Technology, too, continues to make the job easier. Lauris V. Freidenfelds, vice president of Sako & Associates, a Chicago-based security consultant firm, says today’s smart digital video cameras can be programmed to alert the control room if they detect certain motions, or the lack thereof — such as someone’s entering through an exit-only door, or a package left in camera view for three minutes, respectively. “It used to be that if you threw 100 cameras out there but only had one person watching them, it was worthless,” he said. “Now it is as if that security officer were in a dozen places at once.”

Moreover, the basic operating principle of all security —360-degree awareness of the property — is the same in every country in the world, Cosper says. Security teams simply must adapt to the particular dynamics of each mixed-use project. Mall owners are accustomed to shutting down their properties at 10 p.m. and all but sending security home. When the retail component of a mixed-use center shuts down for the night, however, security may still have to patrol the area to make sure passersby — whether hotel guests, drunken barhoppers, insomniac residents or even burglars — stay out. “You may not be able to shut down the atrium or retail sections of the mall,” Bates said. “You’ve got a woman walking from one side to the other to get to the transit station or her car. There are some issues there.”

And if the hotelier, parking garage operator, retail property manager and condo association all hire different security outfits, as sometimes happens in mixed-use projects, they still must maintain close communications and understand each others’ procedures, says Lusher. “The security and management staffs need to be much more flexible in terms of how they relate to all different kinds of people and situations,” he said.

An ambitious mixed-use project may be so iconic that it attracts the attention of vandals or even terrorists. Developers working in countries known to be terrorist targets might think twice about architecture, tenant mixes or flag displays that trumpet the project’s foreignness.

The point is to do a site-specific assessment of the security risks a property and its tenants might face and to then come up with appropriate responses.

Crossing your fingers, unfortunately, isn’t one of them.