On the heels of the grand opening celebration for San Francisco’s new Transbay/Salesforce Transit Center two weeks ago, the Transbay Joint Powers Authority (TJPA) is about to seek board approval to increase their legal budget related to the litigation of who’s responsible for causing the adjacent Millennium Tower’s excess sinking and lean from $10.7 million as of this past June, which was up from $5.7 million in February, to $15.7 million as of today, with the anticipation of additional increases “as the need arises.”

Keep in mind that said $15.7 million budget doesn’t include billings from the TJPA’s general counsel related to the pending Millennium Tower lawsuits which have already exceeded $2.1 million with another $900,000 expected to be billed in the near future.

And once again, in terms of who’s going to foot the rapidly growing legal bills, it’s now anticipated that “a large portion” (which is new language) of the costs “will ultimately be reimbursed by insurance companies for the TJPA’s contractors and/or by the contractors themselves with a duty to indemnify TJPA,” at least in the eyes of the TJPA.

26 thoughts on “Transbay Budget for Sinking Tower Litigation Nears $16 Million Mark”
  1. I remember that Transbay was required by Millennium developers to build a deep wall separating Transbay from Millenium Tower. Ironically, that wall worked really well and preventing any settling seeing as all the leaning is away from Transbay.

  2. And thank you Supervisor Aaron Peskin for suggesting that the taxpayers are responsible:

    Supervisor Peskin blames faulty Millennium Tower on ‘political interference,’ plans to lead investigation (SF Examiner, September 2016)

    “Political pressure may have compromised the duties of San Francisco building officials and led to the tilting and sinking Millennium Tower that is now the subject of a lawsuit, according to Supervisor Aaron Peskin.

    “The swanky residential tower at 301 Mission St. has drawn national attention after reports last month that the 58-story building was sinking beyond expectations, prompting the homeowners association to take legal action. Since then, the circumstances surrounding the tower developed by Millennium Partners have come under scrutiny.

    “On Tuesday, Peskin pointed to the role the Department of Building Inspection played in the development.

    “’We are going to find out who knew what and when they knew it,’ Peskin said during a news conference he called after reviewing some 1,600 city documents related to the Millennium Tower project dating back to 2001. He announced he will hold investigative hearings beginning next week at the Board of Supervisors Government Audits and Oversight Committee.”


    1. Aaron Peskin can be blamed for many things. The Millennium Tower and its costs aren’t one of them.

      He didn’t design it, didn’t approve it, had no role in it.

  3. And he probably wasn’t drunk when he said it. One day SF will understand how so many of the city’s ills can be traced back to Peskin his NIMBYism and his desire to keep SF in the 20th century.

  4. Still not clear on why they thought it was a good idea to build a concrete framed building in the first place (which is like 3x heavier than steel), and then not put the piles all the way down to bedrock.

        1. Not going down to the bedrock is always cheaper (in the short term). They were probably banking on any problems taking more than the seven-year liability window to pop up.

          1. There’s a 10-year liability and nobody builds with the intent to have it last just past that time. Engineers showed that what was done should have worked, not ideal, but should have worked.

        2. Yes, my answer was in reference to the second part of your question; the relative cost advantages would vary with the price of the materials (which in the case of steel are historically erratic)

          1. Part of the reason is the depth of the floor assemblies. Post tension concrete decks are typically 8″ while steel beams and decks are often close to 24″. Over the span of a high rise building, that extra 16″/floor or so adds up to multiple additional floors that can be crammed into the building which translates to additional sellable area and revenue.

            You might ask why office buildings don’t use PT instead of Steel (some do, look at 505 Brannan). I don’t know the full answer to this, but what I have been told in the past is that steel can handle much more live load the same span typical of an office space and it is much more flexible in terms of accommodating future MEPF infrastructure that PT concrete.

          2. Thanks ziggity, that info is helpful. As to why office space does not use the thinner all-concrete decks, it is probably related to the space flexibility issue that you mention. Most office spaces use suspended ceiling, usually aligned just below the depth of the widest steel beam. Thought that leaves about a two foot high void between the suspended ceiling tiles and the bottom of the actual deck for the floor above, that space is used to route and install systems. We’ve all seen network cabling run above the suspended ceiling. There’s also often light freshwater plumbing and other stuff like wifi routers up there too.

            Without that space between the tiles and the floor, it would be hard to reconfigure office spaces. You would end up with expensive and ugly conduit running all over the walls and ceilings.

  5. Jimmythekid is spot on. We are a small 4-unit HOA here in SF and are now in year 6 of a construction defect lawsuit. The only folks making any money are the attorney and the bank that has some settlement dollars sitting in a trust account. Meanwhile the HOA is out over $650K.

    Unless you’ve been involved in a case like this, you’d never dream how contractors, roofers and subs will use every trick in the book to avoid paying anything close to what they owe, while wracking up thousands upon thousands of dollars in attorney fees.

    And read that contract carefully, folks. The prevailing party, in most California mandated arbitrations, will be on the hook for…you guessed it..more attorney fees from the losing party! Gotta love California law.

  6. It’s a long, boring story. Net net: City-approved architectural designs that never should have been built, structural reinforcing that never occurred, and moisture evaporation design work that never happened. The general contractor had roofers build roofs that eventually leaked into several units. Black mold ensued. General contractor then “retired” to protect self, and one roofer goes bankrupt. We’re now on our 5th attorney for the remaining roofer and they’re stalling once again. Arbitration jugde just had open heart surgery so yet another delay. Yawn and the meter’s still ticking.

    1. Sorry to hear you are having a frustrating time.

      How much did it cost to fix the roof and clean out the mold?

      What losses did you incur due to the lack of structural reinforcing that you think happened?

      If they check anything carefully, my impression is that city inspectors check conformance with structural engineering fairly closely.

  7. Hi BEO: the HOA is out over $650K. And yes: one would have thought the “The City Inspectors” would have “caught” the structural engineering defects. The S/E wriggled out of it all by citing a lapsed SOL.

    But then again these are the same lovely DBI people who cited our HOA for 3 cracked concrete pavement slabs in front of our building. We got slammed with a repair notice, with the threat of a lien for non-payment, while the inspector arbitrarily missed an entire section of cracked concrete pavement right across the street. Go figure.

    1. I don’t think this can – or at least should – be called a “structural defect”: it’s a design flaw in that an inappropriate foundation was selected, but insofar as the Building Code apparently allows the applicant discretion in foundation design I don’t see that the inspectors had anything to “catch” (assuming, obviously that this WAS allowed…I’m sure that will be contested during litigation). IMHO, this should be considered a code – not an inspection – failure.

    2. OOPS !! Sorry “hopeman”: I didn’t realize you were referring to the inspection in your own situation, rather than Millennium….so feel free to ignore my critique as it applied to your comment (although I stand by it w/ regard the latter).

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