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WATER INTRUSION
Solutions to water intrusion related problems at walls and windows can be complex and expensive. Proper remediation is often labor intensive, requiring repeated disassembly and reconstruction of components. For all but single story buildings, repairs are performed from scaffolding or swing stages, which further complicates the work. Protection from falling objects must be provided to pedestrians below. When walls are opened to make repairs, temporary weatherproof enclosures must be built whenever the interior is exposed to the elements. Often such temporary enclosures are required by codes and local laws to be fire-rated as a life safety measure.
Minimizing disruption to tenant operations typically becomes a prime consideration in choosing remediation strategies. Reconstruction of existing wall systems often disrupts tenants longer than removal and replacement options. This often tips the scales in favor of replacement of certain components, particularly window systems, over the time-consuming reconstruction. As a result, it is not uncommon for the scope of repairs to include replacement of all window components and even most or all of the exterior walls.
At the time of the investment, the signs that should have signaled the potential risk are often overlooked. Lenders should always be sure to understand the details and limitations of each investment's exterior wall systems. For buildings whose details are vulnerable or questionable, lenders should secure assurances that appropriate preventive maintenance will be performed in a timely manner during the term of the loan.
The replacement of failed sealants is the simplest type of repair, but it too is labor intensive. For the repairs to be durable, old materials must first be completely removed, by grinding and/or the use of solvents. Surfaces must be cleaned of dust and grime before new sealant can be applied.
Prior to replacing the sealants, the reason for their failure should always be determined. The correction of a condition that may at first appear to simply require sealant replacement too often escalates into additional remediation work. This occurs when sealants have failed prior to the end of their expected service life. If the cause is not identified and the condition is remediated, the failure will reoccur. One example of such a failure occurs when the thermal movement at a joint exceeds the range of movement that can be accommodated by the sealant. The sealant tears apart and water can infiltrate the control joint. If movement across the joint were too great to be accommodated by an alternative sealant, proper remediation to solve the problem requires cutting into the wall to install additional control joints.
EXTERIOR WALL SYSTEM CATEGORIES
In my opinion, exterior wall systems are the most misunderstood area of commercial building design, construction and physical due diligence. Improper construction detailing of exterior walls is a common problem, frequently encountered and typically overlooked during physical due diligence. This can result in serious physical risks to the investment that remain unidentified. For this reason, a large portion of this chapter is devoted to this subject.
There are two categories of exterior wall systems, curtain walls and load-bearing walls. Curtain walls support no weight from the structure above, but simply provide weatherproof closure. The majority of modern buildings above one story in height have non-load-bearing curtain walls. Load bearing exterior walls support the weight of the structure above. Modern load-bearing exterior walls are typically used for only one story construction. The exception to this is provided by wood framed stud wall construction. Wood stud framed load-bearing walls are used up to three stories.
For any wall system, the primary concern to a lender is the avoidance of nuisances and damage from water intrusion. Water intrusion related to exterior walls is a frequent chronic physical problem encountered with failed commercial real estate investments. It should be expected that all exterior wall systems will take in water at some time during their expected useful life. All exterior wall materials will eventually deteriorate causing a loss of waterproofing and water will pass through the exterior facing, known as the "cladding". At the same time, most exterior wall materials are somewhat permeable and will permit some water to pass even when new. The details of a wall's construction determines how that water will impact the wall components and whether or not the interior finishes will be affected.
Curtain walls and load-bearing walls are designed and constructed as either cavity systems or barrier systems. Walls built as a cavity system are designed to manage the inevitable intrusion of water. They provide a means to capture the water and direct it to escape, minimizing the possibility of damage to the wall components and the interior finishes. Walls built as a barrier system are designed with the premise that they can remain watertight over time. The exteriors of these systems are intended to allow no water penetration and no provisions are made to drain internal moisture.
Exterior Wall System Risk
For all of the above reasons, the identification and correction of improper or inadequate detailing of exterior wall systems is of importance to the security of a lender. Usually, before remediation efforts have begun, tenants of a building with water intrusion problems likely will have had their operations frequently disrupted from leaking water. Correcting the problems further affects tenant comfort. Repairs create noise, often include the temporary relocation of tenants and the rework of interior finishes. Consequently, tenants whose leases are rolling are more likely to consider the alternative of relocating elsewhere.
Costs for proper corrective work can be so prohibitive that work often gets postponed or cheaper, inappropriate repairs are tried. With this approach, leaks often persist and affect tenant operations repeatedly. Over time, tenant disruptions can lead to occupancy problems. This, coupled with deterioration caused by the leaks, can lead to a weakening and even failure of the investment to meet its debt service obligations. A lender who ends up foreclosing must fund the repairs as part of a plan to improve the property. Loans on buildings with potential exterior wall problems risk a significant loss in value.
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