IEG goes above and beyond the call in providing utility infrastructure services for landlords and tenants

Founded in 1996 in Claremont, California, International Energy Group (IEG) provides third-party validation and financial maintenance of common areas (CAM) with expense and recovery breakdowns of utilities such as electricity, domestic water, trash, etc. for landlords. IEG can provide a full service including initial utility infrastructure design consulting, check meter reading, third-party billing, collections, and accounting of utility services.

IEG grew out of a growing need for landlords to better allocate their utility costs in the areas of natural gas, water, and electricity in a time of escalating prices and market instability.

Understanding both the utility industry and facility operations is essential to ensure infrastructures will not be too expensive to operate. "Equitable allocation of utility charges ensures ongoing profitability of the project and tenant cost controls," says Erick Gomez, president of IEG. "IEG's ability to understand the day-to-day financial concerns and occupancy changes of the operating property puts the landlord at ease and allows the landlord to concentrate on its core business. IEG's ability to effectively communicate with tenants regarding concerns such as water leaks and electric usage problems keeps the landlord out of the troubleshooting business and in the leasing business where its time is more effective."

Flexibility is key to the IEG philosophy. "We look at our customer agreement as the minimum we will do," says Gomez. "We are small enough and flexible enough to help our customers and their tenants with all our agreement asks for and more because we understand their position." IEG actively cultivates an ownership mentality.

"Developers often assume that utility companies and mechanical engineers will take care of the utility development and infrastructure," says Gomez. "But engineers often don't look at it from an ongoing operations standpoint. They deal in the technical aspects of design. For example, it is sometimes less expensive overall to have one meter for an entire development." A single high-volume user often benefits from a volume discount. Submeters may be installed to track how much of a utility any tenant is using. In deregulated states this savings can be even more dramatic, and IEG has brought different projects together under one umbrella to create energy cost savings.

"In California we helped Federal Realty Investment Trust (FRIT) design a utility infrastructure that met its initial cost needs as well as ongoing cost control. In late 1999 the electric utility companies in California were faced with bankruptcy and cost control issues. In this unstable environment we negotiated an infrastructure design that would minimize the risk of rising utility costs to FRIT and at the same time allow for aggregation of the tenants' electrical load to take advantage of large user rates and flexibility to shop for power as one unit," says Gomez. "With a project of this size, with more than 150 retail tenants and 1,200 residential tenants spread over four blocks, first cost and ongoing costs were critical concerns. We provided hard data and analysis from our vast historical database to give FRIT the flexibility to design HVAC systems and utility infrastructures without hindrance since IEG could provide the means of metering and cost allocation."

Ongoing efforts for the project by IEG will include monitoring the consumption of HVAC, electricity, water and other operational costs for individual tenants to equitably break down expenses. "Our experienced staff will also bill and collect these additional rent items and provide a complete accounting and reconciliation of CAM, recoveries, and expenses," says Gomez.

"As tenants become more sophisticated and demand more evidence in terms of CAM and expense allocation from landlords, IEG can help fulfill the utilities role for the landlord. We provide documentation as a third party," he adds.

"We are providing tenants and landlords with options and flexibility to shop for competitive rates in the modern marketplace. There are too many items to consider in the current utility arena to overlook the utility infrastructure as a profit center or profit taker."