I Think the Headlines on Museum Tower’s General Contractor’s “Lawsuit” Reports are Misleading

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Museum Tower

Robert Wilonsky is one of the best reporters in town. He has interviewed me. But I think his headline on the lawsuit that involves Museum Tower’s contractor and a sub-contractor is very misleading.

I’m going to be very straight here. Museum Tower advertises on my blogs, and Museum Tower advertises in the Dallas Morning News. I think it’s a beautiful building, and this is a real estate blog. The reflectivity issue is a hot one, pardon my pun, and very, very unfortunate. Rumors are swirling that all the reflectivity issues and Nasher conflict will end up in a big fat lawsuit.

So when Wilonsky, a far, FAR superior reporter than I, puts in a headline:

“Museum Tower’s being sued in Dallas court over $237,000 in unpaid bills”

and sub headline …

“Museum Tower, now at the center of one lawsuit”

… people took note and jumped to conclusions. Wrong conclusions. A few sent me the article before they had read it, asked me, what gives?

Museum Tower is not being sued directly, it’s contractor, Austin Building Company, is. They apparently didn’t pay the exterior glass fence and railings company, Custom Components, who was involved in the “fabrication and installation of Exterior Glass and Metal Railings”.

According to WFAA-TV, which had a somewhat better headline —

“$800,000 in unresolved claims filed against Museum Tower”

County records show contractors have placed liens on the tower for about $800,000 in alleged unpaid bills. One of the claimants filed a lawsuit against the building and the general contractor two days ago.

Why did the GC, Austin Building Company, not pay Custom Components? Perhaps (I am just purely speculating) there was a discrepancy on the final product, the quality of the work, the timeliness of completion, something that ticked off Austin enough to say, hey, we are not paying you $237,374.50. Which with a $16.2 million contract with these people, is a drop in the bucket.

Also, if you recall, Farmers Branch-based Trainor Glass Company, a huge national glass wall fabricator, shut down it’s offices in early 2012. It was creating interior and exterior glass walls and doors for a whole bunch of projects — not just Museum Tower:

Among the company’s pending projects is a $10 million contract to provide glass for the first four floors of the new Parkland Hospital under construction. Trainor also has a $16.2 million contract with the Museum Tower in downtown Dallas, a $2.2 million job for the Perot Museum of Nature and Science and a contract for $9.3 million for the Baylor Cancer Center. It just completed a $15.1 million contract to install windows at the Omni Dallas Hotel, which is attached to the Dallas Convention Center. It has major public and private projects pending nationwide, from a courthouse in Staten Island, N.Y., to a hospital in Salt Lake City.

So the unpaid bill is likely the result of Trainor’s bankruptcy. Basically, liens can be troublesome in real estate because they scare some buyers off or can complicate closing. You usually just pay them off. But finding the lien holder, if the companies are old, have been sold, or the lien holders are dead, can take up time and research.

But in this case, Austin has purchased a bond to cover any liens. Here’s what their company man told WFAA:

“This is an ongoing dispute between Austin Building Company and its subcontractor, Custom Components Company,” said Austin Industries spokesman Andy Rittler. “A bond was filed to protect the owner of the project in the event of suit to foreclose the lien. Austin vigorously contests this claim, and is working to resolve this issue.”

That’s why these headlines are, in my opinion, misleading. This is not a story to be told in ten or less words, or a headline.

Here is the statement from MT:

Museum Tower’s general contractor, Austin Building Company, and Custom Components are engaged in a dispute over work performed on Museum Tower. This is not an unusual development in the construction industry.

Under Museum Tower’s contract, Austin Building Company as the building’s general contractor is responsible for all sub-contractor payments. Austin has already purchased a bond to cover Custom Component’s monetary claim as well as any other claims submitted by sub-contractors.  Austin will handle any and all dealings with the sub-contractors. A court will determine the validity of the claims and if Austin is responsible for payment.

However, it is important to point out that all the liens in existence are related to work contracted by Trainor Glass Co., which was the third largest U.S. construction glass company involved in major projects throughout the Dallas area—including Museum Tower.  Trainor abruptly ceased operations on February 21, 2012.

Most importantly and to reiterate, Austin Building Company has full responsibility for any filed liens.

 

 

Candy Evans, founder and publisher of CandysDirt.com, is one of the nation’s leading real estate reporters.

5 Comments

  1. […] first to sue. For this reason, a headline in the local news last week caught the attention of many, although not all, Dallasites: “$800,000 in unresolved claims filed against Museum […]

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