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Telephone & Data Cable Update

By: Jeffrey S. Weil

With the 2002 announcement by the National Fire Protection Association of a new provision requiring the removal of abandoned cable, there has been increasing concern regarding the cost and responsibility of completely removing unused data and phone cable in office buildings. Although the National Electric Book Code, revised every three years, does not have legal enforcement powers, these codes are rules intended to ensure minimum construction quality, safety during installation and use of the system. Over time it is felt by many in the industry that these ‘regulation suggestions’ will filter down to local, city, county, and state jurisdictions as part of local code ordinances. Forewarned is forearmed, and both tenants and landlords should be aware of a number of issues which might affect both their space usage and their cash flow in this regard.

Issues to consider: If you move into an office facility and install CAT 5 or CAT 6 wiring, when your lease is up if the wiring is still usable by the next tenancy, can the landlord still require you to pay for the cost of its removal? Landlords are increasingly adding new lease language to address this, but what if there is value to the next tenancy remaining in the existing wiring? Does it make sense to automatically require each tenant to totally remove the wiring they installed?

Several factors have exacerbated the overall ‘obsolete’ wiring issue. Vendors attempting to put forth their most price-competitive bid in order to secure the job might cut the wires indiscriminately, which in many cases renders the system useless. In most of these cases it may be cheaper to totally install new wiring than to attempt to patch together the cut wires. Also, wire technology has evolved and older wiring systems may be obsolete, thus unable to handle current data and telephone requirements. In buildings 15-20 years old, there may be numerous abandoned wires throughout the plenum (the area between the ceiling panels and the floor or roof above) and this is what has caused concern. Are these wires a potential fire hazard, is the accumulation of their weight a safety issue on the ceiling grid, do any of the wiring sheaths hold possibly dangerous materials that could prove disastrous if a fire were to break out?

One telecom vendor told me his new concern was possible lead dust or asbestos contamination, and he envisioned potential skyrocketing installation/de-installation costs if his workers were forced to wear environmental suits, but the other vendors interviewed did not see this as a concern. For the record, I am not an engineer, environmental, legal or other such expert, so please consult your own specialists if this has raised an issue for your particular building.

What are the ballpark costs to remove former wiring, and how much more expensive is it to remove the past three tenancy’s wiring versus just the last tenancy? Using a benchmark office facility of 10,000 square feet, 70 percent open-space workstations, 50 employees (to determine the number of phone and data drops), one of the largest Northern California telecom vendors estimates a cost of $5,000 for removal, based upon two workers spending one week to complete the job.

Another medium-sized vendor estimated $1,500 for the same job, based on a 20 hour job, with 20-30 minutes per station to remove the wiring. A much smaller telecom vendor operator estimated $800, so you can see the price variance depending on the vendor.

Most vendors seemed to agree that the cost to pull three former tenants wiring versus one tenant was about the same. The costs would also vary depending on the ceiling height and accessibility. If there were a high 20 foot ceiling, the job would be far more costly than a more standard 9 foot ceiling.

Used wiring did not appear to be cost-effective for recyclability due to the additional time spent versus return.

What type of wiring is commonly used in today’s corporate office installation? The material cost differential between Category 5e and Category 6 is substantial, with one vendor using a $150/1000 feet figure for Cat 5e and $300/1000 feet for Cat 6. He estimated the cost of materials is 40% of the job, and recommends using Cat 5e to most of his clients. In his opinion, unless they are web designers or software developers there is more than enough capacity in Cat 5e, and Cat 6 would be overkill. His ballpark price per pull for voice and data cabling was between $150-200.

Another telecom vendor uses Cat 6 for most of their installation, and advises clients that with the 15-20% cost differential over Cat 5e they are gaining significantly higher transmission capacity. With potential quantum leaps in technology, this may be a wise investment looking forward five to ten years throughout the lease term and extensions.

There are a number of variables between each installation assignment, including the wiring specifications, how many data and telephone lines per workstation, private offices, if there will be connections in the copy room, lunch room, etc., the ceiling height, if there is an existing panel or if one will need to be installed, if there is access during normal business hours, or if this will be after-hours only, if there is sufficient lead time for the job or if it is a ‘rush’ assignment. Overall ballpark pricing for a 10,000 square foot, 70% open office facility seems to be in the $30-50,000 range, or $3-5 per square foot of office space, based on 50 employees and 60 ‘spots’.

Two emerging technologies, complete wireless telecom within the office suite, and utilizing the new internet voiceover IP systems, will both be discussed in future articles.

One suggestion to reducing the impact on the tenant if the landlord requires wiring removal upon lease expiration – have a separate ‘wiring deposit’ equal to the estimated cost of removal, which in the event that the next tenant reuses the wiring would be refunded to the original tenant. A new deposit would be taken from the new tenant. This would accomplish three things. First, it may encourage the departing tenant to instruct their vendor not to cut the cabling and leave it serviceable for the next tenancy. Second, it should be the tenant’s responsibility for their particular wiring, but the landlord’s responsibility for prior tenancy wiring. Third, this approach defines the cost of ‘unwiring’ and may protect the tenant from the landlord dipping into the much larger security deposit. Of course, I am not a lawyer so please consult your experts in regard to possible legal interpretations.

A number of larger institutional office building owners are proactively removing obsolete wiring as space turns over, but for many of the country’s office properties these issues will continue to evolve during the remainder of this decade.

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