Belltown’s McGuire Apartments Killed by Flawed Construction

Slightlynorth gives you…Belltown!

(Follow-up post on the architects, structural engineers, and general contractor here.)

The McGuire apartment building, at 210 Wall Street in Belltown, opened its doors in 2001. Now, just nine years later, it’s closing them for good. Though the marketing copy, ironically, boasts “exceptional attention to detail in design construction,” the 25-story building, with 272 units, is suffering from “corrosion of post-tensioned cables and concrete material and reinforcement placement deficiencies,” according to legal real estate advisers Kennedy Associates. (Their full press release, with full grout details, is after the jump.)

Since repair is financially infeasible, residents are being relocated (with larger incentives the sooner they leave), and the building will be dismantled. Everyone must go by the end of this year. This comes as a bit of a shock to residents of the upscale building, who are paying $1,000-$1,500 per month just for studios. But investigation of the defects revealed that conditions were becoming unsafe, and Seattle’s Department of Planning and Development is requiring the building’s owner to submit periodic inspection reports to track the building’s health.

Carpenter’s Tower, LLC, is the named owner, a partnership of the Carpenters Union, Local 131, and MEPT, the Multi-Employer Property Trust. They’re suing the general contractor and architects (not named in the news release). Since it’s unlikely the general contractor built just one structure, I’ve got a call in to find out who it was.

In the heyday of building before the real estate market crashed, roughly from 2001 onward, just-add-water condos sprouted up quickly. Nine years was enough to do The McGuire in–that doesn’t seem that long. But the Seattle Times just reported on Northgate’s Thornton Place condominiums, and the settling problem that 20 of the 109 units are experiencing, just a year after project completion. Floors and walls have separated by half an inch so far.

SEATTLE, April 10 – Carpenter’s Tower, LLC, the owner of the 25-story McGuire Apartments in the Belltown area of Seattle, today announced plans to vacate the building at Second Avenue and Wall Street over the next several months due to extensive construction defects which are financially impractical to repair.

“While there are no imminent tenant safety issues, the experts involved in the investigation and repair of the building have indicated that there will be structural issues that could present safety issues by 2011 and beyond,” said Brian Urback, with Kennedy Associates, the real estate advisor for Carpenter’s Tower.  ”The McGuire is not in imminent danger of a structural failure and the experts have advised that the building be vacated by the end of 2010.  Under the circumstances, we are taking steps to vacate the building over the next several months and to help our tenants relocate.   Since the necessary repairs are impractical, the decision of the owner is to dismantle the building.”

The building owner has informed officials at the Seattle Department of Planning and Development (DPD) of the extensive construction defects, which principally involve corrosion of post-tensioned cables and concrete material and reinforcement placement deficiencies.  The post-tensioned cables are corroding because the ends of the cables were not properly protected with corrosion preventative paint, and the grout used to seal the cable ends and anchors was not the specified non-shrink grout and was defectively installed.  As a result, water leaked into these areas and caused the cable ends to rust, and then corrode.  In addition, reinforcement placement in the building’s exterior frame is defective, resulting in cracking and spalling of concrete, as well as structural impairment.

DPD has written a letter indicating it will issue an order later this year finding the building no longer safe to occupy and requiring the owner to “correct the unsafe conditions or vacate the building by December 31, 2010, or earlier.”  The letter also indicates that the city is “requiring that the owner monitor the building condition and periodically submit inspection reports to DPD.”

“We are providing an incentive package to help our tenants relocate much faster than the end of the year,” Urback said.  ”We recognize that this is a major inconvenience so we are trying to make it as easy as possible under difficult circumstances.  We are providing what we think are generous financial incentives if they move quickly.  We are paying moving expenses.  And we are having our building staff help them find new apartments.”

Carpenter’s Tower is owned by Carpenters Union, Local 131, and by MEPT, the Multi-Employer Property Trust.  Construction of the McGuire was completed in 2001.  There are 272 residential apartments and four street-level retail spaces in the building.  Carpenter’s Tower has filed suit against the general contractor responsible for the construction of the building and against the building’s architects.

SOURCE Kennedy Associates Real Estate Counsel, LP

11 thoughts on “Belltown’s McGuire Apartments Killed by Flawed Construction

  1. Shocked, shocked.

    And even harder to believe that Real Estate advertising could overstate the quality of the building being advertised!

    Bummer for the poor tenants.

  2. Cornichon sez “built as a joint venture between the Carpenters Union and Harbor Properties.” Can you clarify Harbor Properties involvement in this? Thanks, MvB.

  3. Harbor Properties was the original owner or co-owner. Harbor Properties sold thier portion or something along those lines to Riverstone Residential. The Carpenters Union is located on the north floor of the building/block with the parking garage occupying the 5 floors above it and residential units directly west of the garage. Harbor Properties had a great management team when they where here, its why i choose to move back and well…its been a ton of headache. i am happy to move. yay.

  4. That’s a BIG oopsie…

    From Emporis’ website: the architect-of-record is Hewitt Isley. The structural engineer is ABKJ. Both are deeply rooted in the Seattle architectural and building community, and have done many buildings in the area. The general contractor was McCarthy, who is a privately-held national firm.

    McCarthy first came into this region a while back (early 1990s? My memory’s not so sharp these days…as if it ever was) when they acquired SDL, then a local, well-established Eastside general contractor. They maintained a local division and presence out of SDL’s old operation, but shuttered it as a part of the economic downturn after 9/11.

    Harbor Properties co-developed this project with the Carpenter’s Union. At this point it’s hard to say what exactly went wrong, but for there to be extensive corrosion with the (post-tension slab, I presume) “cables”, there’s definitely has to be an issue with the concrete work and its (in)ability to keep water out. Whether it’s with its mix design, detailing or with any protective coatings…I guess that’ll come out in court.

    A 9-yr old, 25-story tear-down…it’s just going to be a question of exactly how many and not if heads will roll.

  5. Yes, they were an original co-developer. See the newer “cast of characters” post for more on who did what.

  6. I agree with the comment above. Those people are really getting hit hard. I’m an attorney and would be happy to speak with someone who is being asked to move out of the McGuire Apt Building before the end of their lease. It may be that the tenants are in a stronger position than they realize — they may be able to get much more in concessions that what is being offered by the owner to end the leases early. It sounds like an interesting matter and I’d love to speak with someone free of charge.

  7. “I’d love to speak with someone free of charge”…more value added services from the legal community.

  8. Harbor Properties was the developer and originally leased and managed the property on behalf of its owners.

    The transaction was structured as the construction of two condominiums occupying the same high-rise structure. The apartment portion (which accounts for most of the space) is owned by a highly-regarded national pension fund managed by a respected real estate advisor. Offices occupied by the Carpenters Union are owned by the Carpenters Local.

    The pension fund has financed and owns many millions of feet of union-built commercial space across the U.S., including in the Seattle market. The pension fund is a successful and responsible owner-investor that adheres to a high level of fiduciary responsibility and typically holds its projects for longer periods than do many investors. As others have noted, the developer, Harbor Properties, is highly regarded in the Seattle market and the architect, contractor and key players were “known quantities”. According to the news accounts, contractor error seems to be the likely problem (improper sealing of the structure), although the stance of the engineering inspection company appears troubling. (Having read the news accounts, I wonder if the engineering inspector performed its job adequately?)

    As to whether or not the building can be salvaged: the liability risk to the ownership would be staggering if the structure continued to be occupied. There’s also the question of economic performance: how many people would want to move in after this coverage?

    All told, this is a very sad outcome for all concerned, from the residents, to the developer, to the unions that built the project, to the pension fund and the Carpenters Union that own the project.

    That said, it is possible that the owners of the project will opt to rebuild on the site– with a different contractor and engineering inspector, of course.

  9. Well. I guess architects will be liable for this on top of the constrution co. I cant believe new building has to be taken down, what did inspectors do before open the building? wasnt the building should have undergone complete safety inspection before tenents move in?

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