Developer denies it duped residents of sinking SF condo

When it was completed in 2008, San Francisco’s $350 million, 58-story Millennium Tower epitomized the height of downtown luxury high-rise living. It has since emerged as a house of cards, according to City Attorney Dennis Herrera, who in early November filed suit against the tower’s developer for neglecting to inform condo buyers the condominium was settling into the earth “much faster than expected.”

P.J. Johnston, a spokesman with Millennium developer Mission Street Development, a division of Millennium Partners, told reporters the allegations had “no merit.” He further indicated sinking occurred in “predictable, safe ranges” throughout the entire sales cycle.

“Mission Street Development relied on the expertise of renowned designers and engineers and complied with all state and local laws concerning the disclosure of information to prospective buyers,” the developer further elaborated in a statement.

The building was designed by NYC-based Handel Architects LLP and built by LA-based Webcor Builders. DeSimone Consulting Engineers was the structural engineer.

To date, the tower has sunk 16 inches and is leaning two inches in the direction of a neighboring high-rise. A recent report commissioned by condo owners indicates the structure — the largest reinforced-concrete building on the West Coast — could sink by as many as 31 inches. Coupled with increasing tilt, settlement of that magnitude could compromise elevators, sewage systems and other utilities serving the building, leaving homeowners holding the bag.

“This is every homeowner’s worst nightmare,” Herrera told reporters.

The city suit alleges that as early as 2008, developer Mission Street Development was aware the building had sunk six inches, the amount engineers anticipated the building would settle over its entire life cycle. By 2009, when units were put up for sale, Herrera alleges, the developer was aware the high-rise had sunk 8.3 inches.

“Before they had sold a single condo, Mission Street Development knew their building had sunk more than it was supposed to in its lifetime — and that it was still sinking,” Herrera told reporters. “Yet they didn’t [notify] the home buyers as required by law. It’s that simple.”

“We’re not going to sit by and allow a developer — or anyone else — to enrich themselves at the expense of others by hiding crucial information that they’re required to disclose.”

However, Mission Street contends construction of the Transbay Joint Power Authority’s (TJPA) adjacent $4.5 billion Transbay City Center removed millions of gallons of water from the ground that weakened soil under Millennium Tower and resulted in excessive settlement. “The city attorney’s action has nothing to do with protecting public safety, the building or its residents,” Johnston told reporters. “Instead, it’s an effort by the City of San Francisco to duck its responsibilities and avoid paying for the harm caused by TJPA.”

“By the time dewatering occurred adjacent to Millennium Tower, in May 2013, the tower had already settled 12.1 inches and was tilting further to the North/Northwest,” TJPA countered in a statement. “The excessive settlement is due to the deficient foundation system of the tower.” More particularly, TJPA cited failure to construct a structural system incorporating “end bearing piles” that would have extended to bedrock. Instead, Millennium rests on a concrete slab supported by more than 900 “friction piles” driven 80 feet into dense mud and landfill.

TJPA’s allegation’s have spawned debate over whether San Francisco builders should anchor their buildings in bedrock.

Herrera’s suit is a cross-complaint of a suit filed by Millennium homeowners against TJPA, and it argues that the developer – not TJPA – is culpable for their dilemma.

“My office has a duty to protect all the taxpayers of San Francisco,” Herrera noted in statement. “We’re not going to sit by and allow a developer — or anyone else — to enrich themselves at the expense of others by hiding crucial information that they’re required to disclose. That gave the developer an unfair advantage over competitors, and it cheated home buyers out of information they needed to make an informed decision.”

Meantime, Millennium Partners reportedly has redesigned the foundation of a future project. In this case, the structure will reach bedrock.

For more on the unforeseen engineering challenges of Millennium Tower, check out our original story on the building here.