Engineering Report Finds More Investigation Needed of Balconies at New Jersey Condo

Construction workers looking at plans

The report, prepared by Parallel Architectural Group of Long Branch, found the South Tower did not suffer significant structural damage due to the collapse.

March 20, 2023
Engineering News-Record

Press of Atlantic City

SEA ISLE CITY - An engineering report on the Spinnaker Condominiums' South Tower found that balconies directly beneath the one that collapsed last month, killing a worker, need further investigation before they are deemed safe for use.

Reprinted courtesy of Engineering News-Record

ENR may be contacted at enr@enr.com

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Real Estate & Construction News Round-Up (03/08/23) – Updates on U.S. Mortgage Applications, the Inflation Reduction Act, and Multifamily Sector

Coffee cup next to tablet showing chart

The post explores the cooling housing market and plummeting mortgage applications, potential tax-savings as a result of the 2022 Inflation Reduction Act (IRA), and new developments in the multifamily sector.

March 20, 2023
Pillsbury's Construction & Real Estate Law Team - Gravel2Gavel Construction & Real Estate Law Blog

This week’s round-up explores the cooling housing market and plummeting mortgage applications, potential tax-savings as a result of the 2022 Inflation Reduction Act (IRA), and new developments in the multifamily sector.

  • Rising interest rates are impacting affordability and cooling the U.S. housing market, driving mortgage applications to lowest levels in decades. (Nicole Friedman, The Wall Street Journal)
  • A number of companies are going all out to entice workers back to the office, and as new data on New York City emerges, upscale offices might help do the trick. (Emily Peck, Axios)
  • For real estate developers and investors across the U.S., tax-saving opportunities are popping up as a result of the Inflation Reduction Act of 2022. (David Harlan & Laura Theiss, Dallas Business Journal)

The World’s Largest 3D-Printed Neighborhood Is Here

3D blue key from keyboard

If it can scale, the 3D-printing process promises to deliver energy-efficient and climate-resilient homes that can be built faster, in novel designs and with minimal construction waste.

March 20, 2023
Todd Woody - Bloomberg

Amid the tech boom-fueled sprawl in Austin, Texas, Wolf Ranch at first appears to be another colorfully named but architecturally unimaginative suburban subdivision. Until, that is, you turn a corner and stumble across giant robots building homes resembling waves frozen in concrete.

This 100-house addition to the 2,500 homes planned for Wolf Ranch is called “the Genesis Collection,” and as the world’s largest 3D-printed community, it is indeed sui generis. A collaboration between Lennar Corp., the US’s second-biggest home builder, and 3D-printing startup Icon, Genesis represents perhaps the most significant innovation in residential construction in decades. If it can scale, 3D-printed construction promises to deliver energy-efficient homes that can be built faster and more affordably, in novel designs and with minimal waste. The concrete structures are also more resilient to increasingly intense climate-driven hurricanes, wildfires and heat waves.

“I think we'll look back and say this was a pretty pivotal moment in the history of construction,” says Jason Ballard, Icon’s cowboy hat-wearing co-founder and chief executive officer. “I do think 3D printing and robotic construction are necessary to end the global housing crisis.”


Hurricane Damage Not Covered for Home Owner Not Named in Policy

Glasses lying on Insurance Coverage document

The lender-placed policy clearly did not name Plaintiffs as insureds, additional insureds, and did not indicate that Plaintiffs were third-party beneficiaries.

March 20, 2023
Tred R. Eyerly - Insurance Law Hawaii

The court granted the insurer's motion to dismiss because, although there was coverage for the property under the mortgagee's policy, the home owner was not a named or additional insured under the policy. Cart v. Great Am. Assur. Co., 2023 U.S. Dist. LEXIS 6207 (W.D. La. Jan. 12, 2023).

Plaintiffs' property was damage by Hurricanes Laura and Delta. Because Plaintiff failed to maintain homeowner's hazard insurance subject to the mortgage, Rushmore Management Services procured a force-placed lender policy on the property through Great American. Plaintiffs filed suit asserting breach contract claims. Great American moved to dismiss.

Mr. Eyerly may be contacted at te@hawaiilawyer.com


How Technology Reduces the Risk of Façade Defects

Businessman pointing at red digital lock

The façade is one of the most complex and costly aspects of a building to construct and inspect.

March 20, 2023
Ori Aphek - Construction Executive

The shell of the building is an onlooker’s first impression and crafts the architectural aesthetic, but it also plays a crucial role in enabling energy efficiency and protecting against the elements. Because façades are in direct contact with the elements, issues with water intrusion are the most common problem and the costliest to remedy, with anywhere from 30% to 70% of lawsuits related to water intrusion, half of it through the façade. Additionally, improperly installed façades pose significant safety risks because unsecured parts can fall and hit people below.

All these factors contribute to the façade being one of the most complex and costly aspects of a building to construct and inspect, making up 205 of the total project cost. Installing these systems correctly the first time is the most effective way to mitigate these threats. Teams should utilize data-informed technology that ensures plan adherence, reducing risk and avoiding errors during installation.

The Challenges of Façade Installation
Façade installation and subsequent inspection are inherently challenging, particularly for high-rise buildings. When performing post-installation verification manually, inspectors must review every element, joint by joint, window by window, stone by stone and brick by brick, which can take months to complete. Inspections of the entire building system are limited by this process, as inspectors can only access one portion of the building façade at a time and often have to inspect from indoors, on balconies or at the ground level, which doesn’t paint a complete picture. As a result, teams typically only perform spot checks on the façade and are rarely inspected to their fullest. This leaves many installation errors and defects, which serve as ticking bombs for future water intrusion or safety hazards.

Reprinted courtesy of Ori Aphek, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved.


TxDOT, Flatiron/Dragados Mostly Resolve Bridge Design Dispute

Two people arguing

The Texas Dept. of Transportation ended a temporary suspension of work on the main span of the new Harbor Bridge in Corpus Christi in December after the first of the main design issues was resolved.

March 13, 2023
James Leggate - Engineering News-Record

The Texas Dept. of Transportation and contractor Flatiron/Dragados LLC have “completely satisfied” four of the five main design safety concerns the state agency raised over the under-construction new Harbor Bridge in Corpus Christi, officials say.

Reprinted courtesy of James Leggate, Engineering News-Record

Mr. Leggate may be contacted at leggatej@enr.com

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ABA Forum on Construction Law 2023 Annual Meeting

March 13, 2023
Beverley BevenFlorez – CDJ Staff

The American Bar Association presents a seminar covering “The Future of Construction Law.” The speakers “will focus on key trends in construction law including a retrospective and ‘look ahead’ on Transformative Events in Construction Law, Construction contracting – a look into the future, Emerging trends in arbitration and alternative dispute resolution, the implications of big data on construction claims, Trends in construction insurance and bonding, the future of P3’s, Trends in employment and workforce issues impacting the construction industry.”

April 12th-14th, 2023
JW Marriott Parq Vancouver
39 Smithe St, Vancouver
BC V6B 0R3, Canada


BWB&O Partner Jack Briscoe and Associate Anoushe Marandjian Win Summary Judgment Motion on Behalf of Homeowner Client!

Runners crossing finish line

Partner, Jack Briscoe and Associate, Anoushe Marandjian obtained an order for summary judgment in a multi-theory liability action in Los Angeles Superior Court.

March 13, 2023
Dolores Montoya - Bremer Whyte Brown & O'Meara LLP

Bremer Whyte Brown & O’Meara, LLP is excited to share that Partner, Jack Briscoe and Associate, Anoushe Marandjian obtained an order for summary judgment in a multi-theory liability action in Los Angeles Superior Court.

Plaintiff suffered severe injuries when he fell off a ladder while performing finish carpentry work at the home of BWB&O’s client. Plaintiff alleged various theories of liability against our client, the homeowner, including that: our client supplied a dangerous and defective ladder that, among other things, was unstable and not tall enough for the job; that the floor was covered with a slippery plastic sheeting hidden underneath construction paper which constituted a dangerous condition; that our client was his “employer” under the Labor Code; and that our client was civilly liable on the basis that he had directly hired Plaintiff, who was an unlicensed contractor. Alternatively, Plaintiff alleged that our client was vicariously liable for the conduct of his general contractor, who failed to maintain worker’s compensation insurance covering Plaintiff.

After several rounds of written discovery, which required extensive attempts to “meet and confer” over Plaintiff’s deficient responses, as well as the parties’ depositions, Mr. Briscoe and Ms. Marandjian filed a Motion for Summary Judgment on behalf of our client on various grounds, including that the Privette Doctrine precluded Plaintiff from recovery against our client and that our client was not negligent (there was no dangerous condition and if there was, our client did not create it or that it existed for a long enough time for our client to have discovered it and remedied it). Plaintiff’s Opposition to our Motion for Summary Judgment included a Declaration from an expert witness alleging various grounds upon which our client was liable.


Show Me the Money: The Good Faith Dispute Exception to Prompt Payment Penalties

Woman holding money

In California, if there is a good faith dispute between the project owner and the direct contractor the project owner may withhold up to 150% of the dispute amount and not be subject to prompt payment penalties.

March 13, 2023
Garret Murai - California Construction Law Blog

California has a number of prompt payment penalty statutes on the books. Among them is Civil Code section 8800 which requires project owners on private works projects to pay progress payments to direct contractors within 30 days after demand for payment pursuant to contract or be subject to prompt payment penalties of two percent (2%) per month on the amount wrongfully withheld. Like California’s other prompt payment penalty statutes, however, there is an important carve out: If there is a good faith dispute between the project owner and the direct contractor the project owner may withhold up to 150% of the dispute amount and not be subject to prompt payment penalties. And that, my friends, is a higher-tiered party’s “get out of jail free” card.

In a case of first impression, the 1st District Court of Appeals, in Vought Construction Inc. v. Stock (2022) 84 Cal.App.5th 622, examined whether a project owner’s claim for liquidated damages constitutes a good faith dispute under Civil Code section 8800.

Mr. Murai may be contacted at gmurai@nomosllp.com


A WARNing for Companies

Businesswoman with hands up in warning stop

Complying With WARN Act Requirements During a Layoff

March 13, 2023
Abby M. Warren & Sapna Jain - Construction Executive

Since last fall, news of layoffs in the technology sector have set off a ripple effect in a variety of other industries. Companies engaging in layoffs must be thoughtful and prepared when it comes to taking such action. While the construction industry generally has one of the highest layoff rates, and human resource personnel may be very knowledgeable with regard to related risks and exposure, there are a number of additional issues to consider when there are mass layoffs or closings. Further, expensive litigation awaits if companies are not meticulous in complying with state and federal laws regarding such large scale reductions in force.

Under federal law, the primary legislation governing mass layoffs and closing is the Worker Adjustment and Retraining Notification (“WARN”) Act which generally covers employers with 100 or more employees. This law was enacted to protect employees by requiring companies to provide 60 days’ notice to employees in advance of certain plant closings and mass layoffs. In addition, many states, such as California, Connecticut and New York, have enacted similar state laws, referred to as “mini-WARN” laws, which impose additional requirements, including increasing the length of the required advance notice and broadening the scope of employers to which the law applies.

Reprinted courtesy of Abby M. Warren and Sapna Jain, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved.


Michigan Court Waives Goodbye to Subrogation Claims, Except as to Gross Negligence

Woman waving goodbye in subway corridor

The court held that the insurers could not pursue their subrogation claims – other than their claims for gross negligence – due to waivers of subrogation in the applicable contracts.

March 13, 2023
Lian Skaf - The Subrogation Strategist

In Ace American Insurance Company, et. al. v. Toledo Engineering Co., Inc., et. al., No. 18-11503, 2023 U.S. Dist. LEXIS 15222 (Ace American), the United States District Court for the Eastern District of Michigan determined whether insurers could pursue their subrogation claims against the defendants despite a waiver of subrogation in each of the contracts the insured had with the respective defendants. Based on the language of the contracts and the circumstances leading up to the loss, the court held that the insurers could not pursue their subrogation claims – other than their claims for gross negligence – due to waivers of subrogation in the applicable contracts.

In Ace American, the insured, Guardian Industries, LLC (Guardian), retained Toledo Engineer Co., Inc. (TECO) and Dreicor, Inc. (Dreicor) to renovate a glass furnace in the insured’s glass manufacturing plant. Guardian and TECO entered into a contract on December 6, 2016. Guardian and Dreicor entered into a contract on September 29, 2013, that the parties later updated on June 3, 2016. Both defendants began work on the project in the spring of 2017 and were finished with the portion of the work known as the “Cold Tank Repair” prior to the loss.

On June 3, 2017, there was an explosion and fire at the plant that caused significant property damage. The plaintiff insurers (Plaintiffs) made payments in the amount of $80 million and became subrogated to its insured’s rights. Plaintiffs then initiated this action.

Mr. Skaf may be contacted at skafl@whiteandwilliams.com


Will Maryland Beltway Developer's Exit Doom $7.6B P3 Project?

White question marks on ground

Estimated $7.6B project to add tolled express lanes on busy stretch of Maryland Beltway is in limbo with private developer's withdrawal.

March 13, 2023
Jim Parsons - Engineering News-Record

Maryland’s controversial $7.6-billion plan to build tolled express lanes along two Washington, DC-area interstates has suffered a potentially fatal blow with the departure of the private development consortium from the project.

Reprinted courtesy of Jim Parsons, Engineering News-Record

ENR may be contacted at enr@enr.com

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Court Orders Limited Discovery Before Ruling on Insurers' Motions to Dismiss COVID-19 Claims

March 13, 2023
Tred R. Eyerly - Insurance Law Hawaii

Conceding it was an unusual step, the federal district court ordered that limited discovery take place before ruling on the insurers' motions to dismiss the insureds' business interruption claims due to COVID-19. Philadelphia Eagles Limited Partnership v. Factory Mut. Ins. Co., 2022 U.S. Dist. LEXIS 225729 (E.D. Pa. Dec. 15, 2022).

The Philadelphia Eagles submitted claims to its insurer, Factory Mutual Insurance Company, for large loss of of revenue due to COVID-19. Similarly, the Philadelphia 76ers submitted claims to Hartford Fire Insurance Company for losses due to COVID-19. The insurers denied claims. When suits were filed, the two insurers moved to dismiss.

Mr. Eyerly may be contacted at te@hawaiilawyer.com


Superintendent’s On-Site Supervision Compensable as Labor Under Miller Act

Construction worker walking through site

Does a subcontractor’s superintendent constitute recoverable “labor” within the meaning of the Miller Act and compensable as a cost under the Miller Act?

March 13, 2023
David Adelstein - Florida Construction Legal Updates

A recent Miller Act payment bond decision out of the District of Columbia Circuit Court of Appeals, U.S. f/u/b/o Civil Construction, LLC v. Hirani Engineering & Land Surveying, PC, 58 F.4th 1250 (D.C. Circ. 2023), dealt with the issue of whether a subcontractor’s superintendent constitutes recoverable “labor” within the meaning of the Miller Act and compensable as a cost under the Miller Act that typically views labor as on-site physical labor.

The issue is that the Miller Act covers “[e]very person that has furnished labor or material in carrying out work provided for in a contract.” Civil Construction, supra, at 1253 quoting 40 U.S.C. s. 3133(b)(1). The Miller Act does not define labor. The subcontractor claimed labor includes actual superintending at the job site. The surety disagreed that a superintendent’s presence on a job site constitutes labor as the superintendent has to actually perform physical labor on the job site to constitute compensable labor under the Miller Act.

The subcontractor argued its subcontract and the government’s quality control standards required detailed daily reports that verified manpower, equipment, and work performed at the job site. It further claimed its superintendent had to continuously supervise and inspect construction activities on-site: “[the] superintendent had to be on-site to account for, among other things, hours worked by crew members, usage and standby hours for each piece of equipment, materials delivered, weather throughout the day, and all work performed. These on-site responsibilities reflected the government’s quality control standards, under which the superintendent as ‘the most senior site manager at the project, is responsible for the overall construction activities at the site…includ[ing] all quality, workmanship, and production of crews and equipment.” Civil Construction, supra, at 1253-54.

Mr. Adelstein may be contacted at dma@kirwinnorris.com


Gehan Homes Announces Name Change to Brightland Homes

March 13, 2023
Gehan Homes

DALLAS, Feb. 21, 2023 /PRNewswire/ -- Gehan Homes will consolidate three of its homebuilding brands under one unified brand – Brightland Homes, effective March 21, 2023. The renaming integrates approximately 110 active communities from Gehan Homes, Gray Point Homes, and Wonderland Homes brands across Texas, Arizona, Colorado, and Tennessee.

The company will continue to market some residential construction services and real estate development projects under the Gehan Homes name.

About Gehan Homes
Gehan Homes, headquartered in Addison, Texas, has built new homes at an exceptional value for over 30 years. Known for award-winning designs, quality craftsmanship, and competitive pricing, Gehan Homes is the 13th largest private homebuilder and ranked 29th in the US according to Builder 100. The company builds in over 110 communities across Texas, Arizona, Colorado, Tennessee, and Florida while operating under Gehan Homes, Gray Point Homes, and Wonderland Homes brands. For more information regarding our renaming, visit www.gehanhomes.com or our announcement landing page at www.brightlandhomes.com.


Real Estate & Construction News Round-Up (03/01/23) – Mass Timber, IIJA Funding, and Distressed Real Estate

Coffee cup sitting on top of news

Pillsbury's Real Estate & Construction Team discusses how Infrastructure Investment and Jobs Act (IIJA) funding is being deployed, mass timber is on the rise as decarbonization efforts continue, and commercial real estate remains distressed.

March 13, 2023
Pillsbury's Construction & Real Estate Law Team - Gravel2Gavel Construction & Real Estate Law Blog

This week’s round-up explores how Infrastructure Investment and Jobs Act (IIJA) funding is being deployed, mass timber is on the rise as decarbonization efforts continue, and commercial real estate remains distressed.

  • With a flurry of high-profile projects, mass timber is gaining traction. (Jeffrey Steele, Commercial Property Executive)
  • Commercial real estate is experiencing high levels of distress, with multiple owners defaulting on loans across the country. (Ted Glanzer, The Real Deal)
  • Even with the recent downturn in cryptocurrency value, the metaverse real estate market is expected to continue to grow. (The Real Deal)

Seattle’s Newest Residential Developer

Seattle skyline

The PD aims to develop, own, and maintain housing in the City of Seattle.

March 13, 2023
Michael J. Yelle - Ahlers Cressman & Sleight

On February 14, 2023, Seattle voters passed Initiative 135, creating the “Seattle Social Housing Developer” (“Public Developer” or “PD”) and the initiative was signed into law by Mayor Bruce Harrel on March 1, 2023.[1] With this initiative, voters created Seattle’s newest housing developer. The PD aims to develop, own, and maintain housing in the City of Seattle.[2] In addition, the PD also intends to retrofit acquired properties to increase energy efficiency and bring them into compliance with accessibility standards.[3] Contractors, subcontractors, and suppliers may see this as an opportunity to compete for and build everything from new multi-unit housing to handrail installation projects. This post will explore some of the basics of contracting with a public corporation like the Public Developer and what contractors may want to consider in their business planning.

What is the PD?
The Public Developer is a political subdivision of the State of Washington, like a port or fire district.[4] The Public Developer is not an agency or department of the City of Seattle. In this way, it is like Seattle Public Schools (SPS) because both SPS and the PD operate within the City of Seattle, but have (or will have) their own staff, procurement rules, and standard contracts distinct from the City’s. Like SPS, the PD can also enter construction and supply contracts, sue, and be sued.


Court Denies Insured's Motion to Dismiss Complaint Seeking to Compel Appraisal

Red denied stamp

The insureds reported damage to their property arising from Hurricane Ida.

March 13, 2023
Tred R. Eyerly - Insurance Law Hawaii

The court denied the insured's motion to dismiss after the insurer filed suit to compel an appraisal. Allied Trust Ins. Co. v. Tsang, 2023 U.S. Dist. LEXIS 352 (E.D. La. Jan. 3, 2023).

The insureds reported damage to their property arising from Hurricane Ida. The insurer, Allied Trust, investigated and determined that the covered damage was $1,978.18, which was less that the policy's deductible. The insureds estimated that the covered damage was $135,270.78.

Allied Trust invoked the appraisal provision. Allied Trust later filed suit alleging the insureds failed to comply and participate in the appraisal. The insureds moved to dismiss the complaint as moot. In their motion, the insureds argued that because they were now complying with the appraisal clause, all relief sought by Allied Trust had either already occurred or was currently underway.

Mr. Eyerly may be contacted at te@hawaiilawyer.com


Red Tape Is Holding Up a Greener Future

Green leaves after rain

Renewable energy is key to fighting climate change. But misguided regulations are stopping crucial projects from moving forward.

March 13, 2023
The Editors - Bloomberg

Seven months on, Democrats are still celebrating the Inflation Reduction Act, even though a crucial determinant of its success — permitting reform for energy projects — remains undone. Recent data shows just how imperative it is for them to stop dragging their feet.

What’s now called the IRA had little to do with inflation. It was a climate bill, and a big one: It provided $370 billion to improve energy efficiency, reduce emissions and smooth the path to a clean-power economy. It came on top of a 70% surge in private investment since 2017.

But the biggest impediment to the US energy transition isn’t financing: It’s building.

A decade ago, between 25% and 30% of proposed wind and solar projects moved from the drawing boards to completion. But as new projects and new funding have soared, utilities have been unable to keep up, leading to an immense backlog. A recent report by BloombergNEF found that over just six years, global clean-energy investment has gone from half the level of fossil-fuel investment to near parity, an extraordinary leap that reflects the market’s appetite for clean power. Yet America’s dysfunctional regulation is preventing many needed projects from even breaking ground.


New Jersey Appellate Decision Reminds Bid Protestors to Take Caution When Determining Where to File an Action

Judge and witness illustration

The New Jersey Appellate Division held that University Hospital is not a “state administrative agency” and, therefore, the Appellate Division does not have original jurisdiction to determine the merits of an action commenced by an unsuccessful bidder to challenge the award of a contract.

March 13, 2023
Brian Glicos & Nicholas J. Zaita - Peckar & Abramson, P.C.

On February 21, 2023, the New Jersey Appellate Division held that University Hospital is not a “state administrative agency” and, therefore, the Appellate Division does not have original jurisdiction to determine the merits of an action commenced by an unsuccessful bidder to challenge the award of a contract. In re Protest of Contract for Retail Pharmacy Design, Constr., Start-up & Operation, Request for Proposal No. UH-P20-006, A-1667-20, 2023 WL 2125002 (N.J. Super. Ct. App. Div. Feb. 21, 2023).

Pursuant to Rule 2:2-3(a)(2) of New Jersey’s Rules of Court, final decisions or actions of any state administrative agency or officer may be appealed directly to the Appellate Division as of right. Accordingly, where an unsuccessful bidder chooses to challenge the award of a contract issued by, for example, the New Jersey Department of Transportation, the unsuccessful bidder must file its action directly with the Appellate Division. On the other hand, where an unsuccessful bidder wishes to challenge a contract award made by a local municipality (among a slew of other public entities), the Superior Court Law Division maintains original jurisdiction over the dispute.

Reprinted courtesy of Brian Glicos, Peckar & Abramson, P.C. and Nicholas J. Zaita, Peckar & Abramson, P.C.

Mr. Glicos may be contacted at bglicos@pecklaw.com
Mr. Zaita may be contacted at nzaita@pecklaw.com



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