The Pitfalls of Converting Houses for Commercial Use

Loss Amount: $460,000

What Happened: Fire raged through an old commercial building, causing considerable structural and smoke damage. An investigation revealed that outdated wiring in the foyer caused the blaze. Originally constructed as a large family home in the 1930s, the building was later converted for commercial use.

After the fire, the building required major reconstruction, which kept it out of use for a six-month period. Additionally, considerable upgrades were required to comply with current laws and building codes, which included electrical wiring, earthquake reinforcement, and handicapped access and accommodations.

Lesson Learned:

  • Old wiring and heavy circuit loads resulted in localized heating that caused the insulation to break down and ignite nearby combustible materials.
  • The electrical wiring was already decades old when it was converted for commercial use, which resulted in a requirement to carry a heavier electrical load than was anticipated.
  • Any building conversion or major remodeling of old structures requires that the electrical system be replaced and upgraded to meet current codes and heavier commercial usage and power requirements.
  • Buildings constructed in the mid-1960’s and ‘70’s may have aluminum wiring that could present fire and electrical system hazards.
  • Hire only a licensed electrical contractor to inspect and make required repairs or upgrades.
  • When rebuilding or remodeling old structures, anticipate unexpected delays which can lead to a loss of business for property owners and tenants.
  • Local permits and the city or county plan review process can cause delays in completing a construction project within expected time-frames.

For further assistance in preventing all types of losses, call VISC at 888.762.3143.