Industry Spotlight

Corporate Headquarters
One Riverway, Suite 2350
Houston, Texas 77056
713.626.2525
713.626.2555 (fax)

Construction Litigation

Judge weighing arguments in $700 million Fontainebleau fraud lawsuit

VEGAS INC

"...[I]t was little surprise when 23 attorneys packed into a Las Vegas courtroom...to argue about whether a fraud lawsuit could continue over the failed $2.9 billion Fontainebleau Las Vegas casino resort."

"The suit..., which charged Fontainebleau executives and associated companies hid cost overruns and other problems from lenders...."

"...[T]he state Supreme Court has yet to rule on a dispute over whether lenders or contractors...have the first priority to receive payments from the...bankruptcy court fund...."

Contractor sues district $2.8 million over Citadel project

Reading Eagle

"Building Reading's Citadel intermediate high school was a process fraught with cost overruns and delays, and seemed destined to end up in court."

"...Perrotto claims the district has refused to pay for extra work that arose during construction. The suit also says the district's interference caused lengthy delays...."

"The project was broken into two parts: one with a price tag of just over $14 million and the second with a cost of more than $13.7 million."

Lawsuit over BC Place roof steel heating up in court

Journal of Commerce

"Freyssinet Canada...recently filed a $6.5 million lawsuit in B.C. Supreme Court against...Canam Group Inc.,...PCL Constructors...and...B.C. Pavilion Corporation (PAVCO)."

"PAVCO negotiated a $458 million fixed-price contract with PCL Constructors Canada Inc., the primary contractor on the project. Freyssinet began work in July 2010 and signed a $30 million dollar subcontract with Canam...."

"Freyssinet claims Canam breached the terms...by carrying out a series of unilateral decisions that caused time delays and cost escalation on the erection of the cable."

Construction Defects

Jersey City suing developer of Summit Avenue municipal courthouse, claiming the building is in 'a state of collapse'

The Jersey Journal

"The City of Jersey City is suing the developer of the $23 million municipal Justice Complex...which the city claims was so poorly constructed that the building's foundation...puts the public 'at risk of bodily harm.'"

"...The city...accuses the developer and a number of architects, engineers and subcontractors of negligence, breach of contract, consumer fraud and 12 other counts."

"The alleged negligence extends to the 'building, building foundation, interior and exterior stairs, interior and exterior walkways, interior and exterior railings,' and more...."

'Torn open': Wind rips off parts of $2.8 billion terminal's roof at Beijing airport

msnbc.com

"Substandard construction work was blamed...after wind blew parts of the roof off a $2.8 billion terminal at the world's second-busiest airport."

"One of the architects behind Beijing Terminal 3...told the Associated Press that inadequate materials or installation - not design flaws - were to blame for [the November 22] structural failure."

"It was the second time in a year that wind damaged the airport...."

Construction Delays

Philadelphia airport terminal work delayed by lawsuits

The Inquirer

"...[C]ompletion of the project - now estimated to cost $341 million, up from an initial $185 million in 2005 - is mired in construction lawsuits and finger-pointing."

"The lawsuits attribute the delays, costs, and failure to get work done to 'change orders,' revisions to TSA...mandates, and contractors that did not do what they were supposed to do."

"Experts say the way public construction projects are bid in Pennsylvania adds to inefficiency and drives up cost. State law requires that cities and public agencies seek multiple independent 'prime' contractor bids...."

Watchdog says Ga. nuclear plant faces delays

Associated Press

"The Southern Co. continues to face 'significant challenges' building the country's first brand-new nuclear plant on time and without exceeding its share of the roughly $6 billion budget...."

"The construction of two new reactors at Plant Vogtle...tests whether the nuclear industry can build without the long delays and enormous cost overruns that plagued the industry decades ago...."

"Company officials planned to have the first of the new reactors effectively complete by April 2016, but that schedule has now slipped five months...."

Lawsuits filed over Abu Dhabi property

The National

"Abu Dhabi is starting to experience many of the same issues that plagued Dubai's property market, with more buyers complaining about construction delays...."

"Dozens of lawsuits have been filed over stalled projects. And many buyers have been upset at unexpected fees and the quality of construction in newly completed developments...."

"Construction delays have also prompted threats of legal action by buyers in Tameer Towers, the $1.9 billion development on Reem Island. The project was initially scheduled for completion in June."

Construction Costs

Delays to DHS headquarters add $500M

Federal Times

"The initial plan called for $3.45 billion to consolidate DHS operations on the site of the former St. Elizabeths Hospital in Washington, D.C., by the end of fiscal 2016."

"DHS has relied mostly on $200 million in funding from the American Reinvestment and Recovery Act...to complete the Coast Guard headquarters by spring of 2013 - the only part of the project that appears on track to wrap up on time."

"If Congress does not approve any money for the project in fiscal 2012, it will delay the move-in of all other DHS components...from two to three years or more...."

Santa Clara, 49ers announce deal to pay for stadium

The Mercury News

"The NFL team and Santa Clara announced...that they have captured all the money needed to build a proposed $1 billion football stadium... -- the largest and final obstacle needed before construction can start."

"Goldman Sachs, U.S. Bank and Bank of America have agreed to loan...a combined $850 million to pay for the lion's share of the construction, which could start as soon as next year...."

"The price of the 68,500-seat, coliseum-style home field has jumped from $987 million to $1.02 billion, largely because of tweaks to stadium design...and inflation."

Construction Economics

China State Construction Plans $2B U.S. Push

Bloomberg

"China State...the nation's biggest builder by market value, intends to buy a U.S. construction company next year as it begins investing as much as $2 billion in the world's largest economy."

"China State, which renovated the Alexander Hamilton Bridge in New York, also plans private-public partnerships in the U.S. over the next five years to help pare its reliance on domestic and emerging markets...."

"The Beijing-based company...will also seek to team up with a U.S. company on real-estate projects in the country...."

Industry Spotlight

US Commuter Rail Construction Chugging Along with Federal, Local Funding

With recent public and congressional attention focused on the federal budget, high-speed and commuter rail funding has been an easy target of impending budget cuts. But states and cities across the US are finding ways to move along with rail projects in all stages of completion, from anticipating and approving funding, to groundbreaking and completing construction. Read on in this month's issue to find out which projects are, at least for now, not stopped in their tracks.

High-speed rail service to St. Louis on track

Medill News Service

"The construction of the high-speed railway between Chicago and St. Louis will move forward, officials said, despite Congress' decision to eliminate funding for high-speed rail projects."

"The route between Chicago and St. Louis is the only line under construction in the Midwest network. The project will upgrade the current track between the two cities and allow trains to run at speeds as high as 110 mph."

"The construction on some segments of the route has been completed, while the route for other segments is still being studied. The project is expected to be completed by 2014."

Timetable set for Eastern Corridor rail project

Cincinnati.com

"The construction of the long-planned commuter rail system linking downtown Cincinnati to western Clermont County is scheduled to begin sometime between July 1, 2012, and June 20, 2013."

"The total cost of the commuter rail running from downtown Cincinnati to Milford has been estimated at $411 million. But...the actual cost could be lower than that."

"The rail project is the centerpiece of a $1.4 billion Eastern Corridor project designed to improve the region's transportation network...."

$280 million infrastructure loan OK'd to build Denver's Eagle P3 commuter rail line

Equipment World

"The project is a two-pronged effort. The western segment of Eagle P3...will serve the Denver-area suburbs....The East Line will run from Denver's historic Union Station...to Denver International Airport....Both lines are under construction...."

"The entire project should be completed in 2016. The new railcars slated for use on the commuter line will be assembled in the United States...."

"Together, the...ongoing renovation[s] are part of...a voter-approved, multi-year, multi-billion-dollar transit expansion program covering 140 miles...."

Key step for BART to San Jose

The Mercury News

"The Valley Transportation Authority is poised to approve a $772 million contract for construction of the BART extension to San Jose -- the biggest contract awarded in the decades-long dream of linking the South Bay with the heavily used commuter train."

"The VTA is seeking $900 million from the FTA, which gave the BART extension a recommended rating in 2010. Money would be parceled out over several years...."

"The...group said it could finish work by late 2016, meaning the BART line could open more than a year ahead of the projected 2018 schedule."

Airports board approves financing agreement for Phase 2 of Dulles rail

The Washington Post

"The first phase is under construction and is expected to open to riders in December 2013, although...it could be as much as $150 million over budget."

"One of the biggest disputes in building the second phase was whether a rail station at Dulles should be aboveground or underground and closer to the main terminal, at a greater cost."

"As part of the deal, the two counties and the airports authority are expected to receive federal loan assistance to finance their portion on the project. MWAA officials said they expect to receive about $250 million in federal loans."

Rail project in line for share of $510 million in federal funding

Honolulu Star Advertiser

"Honolulu's rail transit project is eligible to receive a share of...federal funds next year provided that the city is able to complete a critical full-funding grant agreement with the Federal Transit Administration by the end of 2012."

"The rail funding is among several Hawaii projects receiving funding in fiscal year 2012...."

"Language in the measure specifies that funding 'shall be available for preliminary engineering, final design, and construction....'"

Disclaimer | Privacy Statement