Thursday, September 4, 2014

The 32 Story Modular Atlantic Yards Dispute Headed to Court

With construction now halted on the first residential tower in the Pacific Park complex formerly known as Atlantic Yards, the developer and the construction firm sue each other over who's to blame.

Developer Forest City Ratner Cos. and the contractor for a modular residential tower at Atlantic Yards, the complex-to-be recently rechristened Pacific Park, have filed lawsuits against one another Tuesday morning. The legal tussle comes after work stopped at the building last week.

Last Tuesday, Skanska USA Building, a division of a multinational Swedish construction company, stopped work on B2, the 363-apartment building being built through modular construction techniques next to Barclays Center. That led to workers at FCS Modular, the company jointly created by Forest City and Skanska to build the modular units at a Brooklyn Navy facility, being furloughed.

Skanska contends that it had to shut construction down after Forest City refused to address design and commercial issues with its modular plans. Skanska AB, the parent company of Skanska USA Building, filed suit in state Supreme Court Tuesday morning, accusing Forest City of violating its contract by changing construction plans for the tower, according to a report from Bloomberg.

"Forest City Ratner represented with great confidence they had developed the high-rise modular solution … That turned out not to be true," said Richard Kennedy, co-chief operating officer at Skanska USA. "Now, rather than acknowledging their problems, they are slinging mud at Skanska."

But the same morning, Forest City filed a suit of its own again the Swedish firm, accusing the company of violating its contract and failing to deliver the modular units at the agreed-upon time and budget.

"Our priority is to reopen our factory and put the employees that Skanska wrongfully furloughed back to work so we can resume construction on B2," Forest City Ratner Chief Executive Mary Anne Gilmartin  said in a statement. "Skanska's unilateral action has barred construction from continuing, and this lawsuit is the first of many steps we intend to take to get this building moving again."

Earlier this year, Forest City announced a partnership with Shanghai-based investment firm Greenland Holdings. The partnership, known as Greenland Forest City Partners, is set to begin three other buildings in the Pacific Park complex, and is not involved in the B2 dispute.

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