California in hot water

California homes and businesses, including shopping centers — of which the state has nearly 115,000 — will be required to curtail their water use, in some cases drastically. But even shopping center owners that have been committed to conservation may have difficulty. For one thing, those with properties in multiple jurisdictions may need to contend with different requirements from location to location. The state is aiming to slash overall

urban water use by 25 percent. To achieve that, the Water Resources Control Board has assigned conservation targets to each of the roughly 400 agencies that supply water to the cities and towns. Agencies serving areas with relatively high levels of water usage per capita must come up with ways to cut usage by as much as 36 percent over 2013 levels. Agencies serving the lower-use areas, of course, will have to meet less-demanding targets. 

The agencies have discretion in determining how to achieve their specific targets. They may, for instance, decide how much of the cutbacks should be borne by commercial and industrial customers versus homeowners. These agencies can fine customers by as much as $500 per day for failing to comply with the cutbacks and with new state bans, which include prohibitions on using drinking water (called potable water) for such things as washing sidewalks and driveways or to irrigate ornamental turf on public medians. There are also bans on the use of potable water in decorative water features that do not recirculate the water. Outdoor irrigation within 48 hours of “measurable rainfall” is no longer allowed. And all this reaches even to restaurants, which are permitted to serve customers water only upon request.

“If you are a large company with multiple projects over many municipalities, you can’t create a blanket policy — compliance must be addressed locally by working with each water agency,” said Chuck Shaw, vice president of development at San Rafael, Calif.–based Sywest Development, and also chairman of ICSC’s Western Division Government Relations Committee. “Companies like ours have been coordinating with our landscaping professionals to ensure that we are adhering to the requirements of each individual water agency,” Shaw said. “We are also working with tenants to ensure they are taking all of the appropriate conservation measures, which means, for instance, having no running toilets or plumbing fixtures that use excessive amounts of water.”

Sywest and other California landlords are hardly strangers to water-conservation issues. Many of them across this parched state have been working for years to curtail water use at their properties: upgrading irrigation systems and plumbing fixtures, tearing out turf for replacement with drought-resistant plants and, in some cases, refraining from replacing plants as they die off. As a result, some may have trouble squeezing out any additional water savings, particularly when it comes to making drastic cuts, says Rex Hime, president and CEO of the California Business Properties Association. Hime has been seeking to draw attention to this dilemma at the state level. He has also urged constituents to ask their local water agencies to consider those steps they have already taken to reduce consumption when developing mandates for customers. “Shopping centers have been working to conserve water because it makes both environmental and business sense,” said Hime. 

Some properties have already cut their water use significantly in recent years by installing native plantings, drip irrigation systems and “smart” irrigation controllers, Hime says. “They may have already reduced consumption at certain sites by 40 percent, and now they may be asked to cut usage by another 25 percent. That’s a problem. What are they going to do? Ask people to bring their own water to the mall?” 

Donahue Schriber Realty Group, a Costa Mesa, Calif.–based REIT that owns 70 centers in California and in other Western states, is among those that have made efforts to slash water use through the years. The company has already deployed smart irrigation controllers at about 25 percent of its properties, which activate sprinklers on an as-needed basis rather than on a set schedule, by monitoring weather and soil-moisture conditions. On an average annualized basis, these controllers have reduced water consumption by some 25 percent at individual Donahue Schriber properties, according to Henry Avila, the firm’s senior vice president for asset management. The company is installing the controllers across the rest of its portfolio and has also replaced nearly 5,000 standard sprinkler heads with precision ones at all its shopping centers. “Water consumption is not a new topic within California,” Avila said. “We have been in a drought for the previous four years and prior to that on the dry side,” he said. “As a company, we have been employing a variety of water-conservation initiatives over time.”

Donahue Schriber has replaced upwards of 25,000 square feet of turf throughout its portfolio with drought-tolerant plantings over the past three years. “Although turf presentations are beautiful, they are high water users, so we have to look at alternatives,” Avila said. Among those alternatives are succulents, which do not need as much water. Over the past few years, Donahue Schriber has refrained from regular “landscape enhancements” in various locations. In some spots where flowerbeds once stood, there is now manicured soil and signage that informs the public about what the company is doing to help conserve water, says Avila, though he does concede that he worries about how the company will make any deeper cuts. “How do you produce additional savings with turning off the spigot? I don’t think anyone wants to see universally dead landscaping,” said Avila. 

Even while Macerich, one of the largest mall owners in California, waits for the water agencies to formulate their mandates, the firm is proactively taking simple and straightforward steps to further curtail water use at its properties, according to Jeffrey Bedell, vice president for sustainability at the Santa Monica–based REIT. “We have already started to make cuts, because we can’t wait around to hear what the final policies will look like,” said Bedell. The company is expanding on existing initiatives, which have included altering irrigation practices, installing drought-tolerant greenery in areas that require replanting, and retrofitting bathrooms with no-flush urinals, dual-flush toilets and automatic faucets. “We’ve already reduced our usage by tens of millions of gallons of water over the last couple years,” said Bedell. “If we now have to cut another 25 percent, it becomes very difficult and painful to do that. We will strive to meet the requirements, but we just need a little more clarity to make sure we put the right strategies in place.” 

If Macerich is required to slash its water use drastically in some locations, it has a few possible options, says Bedell. The firm can halt or significantly reduce the watering of outdoor and indoor plants, and/or tear out turf on parking lot islands. It can install underground cisterns to capture rainwater and runoff. Water collected in the cisterns would be treated and used for irrigation and to supply the rest rooms with water for toilet flushing. “We don’t get much, but we do get rain,” said Bedell. “Right now that water doesn’t get captured and reused. It can be done, but it is capital intensive.”

Like other shopping center landlords, Macerich must figure out how to motivate some of its tenants to conserve. Shopping center tenants generally fall into two camps here: Some occupy spaces that have their own water meters and are thus responsible for complying with local mandates on their own. Other tenants occupy space on a shared meter, which means that their usage counts toward the total for a given property. Most retail tenants have minimal water needs, but restaurants and hair-and-nail salons tend to be heavy users. Macerich is reaching out to tenants to let them know what the company itself is doing to conserve water and to make them aware of resources, such as local rebate programs, that could help them take similar steps. “We can’t dictate to them what they have to do,” said Bedell, “but the hope is that we can get them to realize that we are all in the same boat. That typically elicits a good response.”