The setup
- Building
- A hypothetical one-story retail building with a flat roof and several tenant suites near downtown Parker.
- Tenant
- A small gift and home goods shop with inventory on floor-standing shelves and a stockroom in back.
- Ceiling
- Suspended acoustic tile ceiling with light fixtures, below a roof deck with interior roof drains.
- Lease
- Landlord maintains the roof and building systems; tenant insures inventory and the improvements they built out.
The situation
Illustrative example. Not a real job or customer.
Late on a summer afternoon, a short, intense thunderstorm with small hail moves over Parker. Leaves and hail clog the roof drain above the shop. Water pools on the roof, finds a seam near a rooftop unit, and starts dripping through the ceiling tiles over the stockroom and part of the sales floor.
- The shop owner sees ceiling tiles sagging and dripping. She moves customers away, puts out buckets, and switches off the circuit feeding the light fixtures in the wet area.
- She calls the property manager's emergency line. The manager sends a roofer to clear the drain and inspect the seam that evening.
- She photographs the ceiling, the wet stock and the floor, and moves boxes off the stockroom floor to a dry section of the sales floor.
- The landlord's restoration contractor removes saturated ceiling tiles, extracts water from the commercial carpet tile, and sets up drying equipment with plastic sheeting to separate the stockroom from the sales floor.
- The shop owner inventories damaged goods by item, with photos, and sets them aside for her insurer rather than discarding them.
- With the sales floor separated from the work area, the shop reopens the next morning with reduced hours while drying continues in back.
The landlord's insurer handles the roof repair, ceiling and building finishes. The tenant's business policy handles damaged inventory, and because the shop stayed open, the lost-income portion is small. The tenant asks the landlord to add roof drain cleaning before summer to the building's maintenance schedule.
Who handled each piece
- Item
- Clearing the roof drain and repairing the seam
- Responsible party in this example
- Landlord
- Why
- Roof and building systems are the landlord's under the lease
- Item
- Ceiling tiles, grid and base-building drywall
- Responsible party in this example
- Landlord
- Why
- Part of the building shell the landlord insures
- Item
- Carpet tile installed by the tenant
- Responsible party in this example
- Tenant
- Why
- Tenant improvement under this lease
- Item
- Inventory and display fixtures
- Responsible party in this example
- Tenant
- Why
- Tenant's business personal property
- Item
- Lost sales during reduced hours
- Responsible party in this example
- Tenant's insurer, if covered
- Why
- Business income coverage, subject to its terms and waiting period
Takeaways for a small business owner
- Know the property manager's emergency contact and save it in your phone today.
- Keep stock off the floor where you can, especially in back rooms below roof equipment.
- Photograph inventory before moving it during an emergency, even quickly.
- Ask whether the drying area can be sectioned off so you can keep selling.
- Read the lease's maintenance and casualty sections before a loss, not after.
- Ask your agent whether your business income coverage has a waiting period.
General information for Parker, not a quote or professional advice. In an emergency, call 911.