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The Harmon, center, was designed to rise to 49 floors, with condominiums built above the hotel floors. But the discovery of and attempts to fix a critical mistake in construction have CityCenter developer MGM Mirage deciding to scrap the condo part of the project.
Published Wednesday, Jan. 7, 2009 | 2 a.m.
Updated Wednesday, Jan. 7, 2009 | 10:42 a.m.
Sun Archives
- CityCenter accepting applications for 12,000 jobs (1-5-2009)
- Evidence of change: Six months, no fatalities (12-28-2008)
- CityCenter hotel project slowed by corrective work (9-17-2008)
- Sales open at CityCenter’s Harmon (1-16-2008)
Video archives
- Topping Out CityCenter (5-16-2008)
Beyond the Sun
The Harmon Hotel & Spa – originally planned as a 49-story building with some 200 condominiums atop 400 hotel rooms, will no longer offer condominiums and instead will open in late 2010 as a 400-room hotel, MGM Mirage said today.
The Harmon, one of six towers at MGM Mirage's CityCenter resort complex under construction on the Strip, had been slated to open in November.
As first reported in the Las Vegas Sun early this morning, MGM Mirage was considering topping off The Harmon where the hotel ends, which would be a little more than half of its planned height, after months of extensive structural repair work that slowed progress on the tower.
MGM Mirage executives had recommended the change as of Monday afternoon but other parties involved in CityCenter, including the company's lenders and joint venture partner Dubai World, had not yet signed off on the decision.
By cancelling the condominiums, the partners will be able to avoid the need "for substantial redesign" of The Harmon "resulting from contractor errors," CityCenter Chief Executive Robert Baldwin said in a statement today.
The scaled-back building, as well as other cost-saving measures initiated by MGM Mirage amid this recession, will result in savings of about $600 million at CityCenter. Postponing The Harmon by a year will defer about $200 million in construction costs to fit out the building's interior, Baldwin said.
The final budget for CityCenter, the largest commercial construction job in U.S. history, is in flux but is likely to be less than the most recent official figure of $9.2 billion.
Since August, workers have been correcting concrete and rebar construction at The Harmon. Rebar is the steel used to reinforce concrete.
At The Harmon, “they ... installed it wrong. That’s the bottom line,” said Ron Lynn, Clark County Building Division chief. “They made a mistake.”
Clark County inspectors, he said, uncovered rebar problems on 14 floors.
Lynn characterized the rebar problems as “significant” and “very unique.”
“We do not see this very often,” he added.
The placement of the steel bars and how they are configured are calculated to maximize a structure’s strength.
“It’s very important,” he said. “Even if you have the correct number and size of rebar, it’s not enough if it’s not in the right place.”
In The Harmon, Lynn explained, some of the rebar was spaced incorrectly and some ties, which hold the bars together, had been cut by a torch.
Had the problems never been detected, the building would very likely have been able to withstand its own weight, Lynn said.
“It’s tested every day with the activities of construction including workers, equipment and wet concrete,” he said.
But the potential risk would have increased with an earthquake or high winds.
“Just having the rebar there provides some structural strength, but when you have a high wind or seismic load, you have to tie them together, and if they are improperly tied or spaced, that can result in problems,” he said.
Lynn said an employee of Halcrow Yolles, the engineer of record, discovered The Harmon’s rebar problems last summer after walking the site and noticing some cut ties.
That led to a larger investigation. In some cases, rebar problems were found before concrete had been poured around them. Where concrete had been poured, the concrete would have to be chipped away and repoured after fixes were made.
As of Tuesday, plans for all those repairs had not been submitted to the county.
“They are still trying to figure out how to do some aspects of the final structural fix,” Lynn said.
In an Oct. 27 letter to AAI Architects regarding “Harmon Tower Construction-Progress of Link Beam Repair,” Frank Martinovic, Halcrow Yolles principal, hinted at the difficulty of fixing the problem in his opening paragraph:
“The current status of the link beam repair is such that it does not appear the contractor can execute the repair as detailed in a timely manner,” he wrote. “Given this fact, I see no recourse but to abandon the repair as currently being executed once level 15 is complete.”
Martinovic also wrote that a re-analysis of the building was taking place with “the goal of this analysis ... to repair the building without the extensive demolition and in a manner that can be executed quickly in order to meet the project goals.”
Martinovic could not be reached for comment this week.
Lesley Pittman, a spokeswoman for CityCenter contractor Perini Building Co., said the corrective work is in progress. Pittman declined further comment.
Insiders close to the project said the souring market for condo sales played a minor role in the decision. Scaling down the building made more sense than demolishing the building or leaving it unfinished, they say. Construction had stalled at the 23rd floor.
Lynn noted that inspectors find issues on “almost every” construction site. Another significant problem, albeit one easier to fix, was found at Veer, also within the CityCenter complex.
At that site, inspectors found problems with the stirrups or ties holding rebar “cages” together. During prefabrication of the cages, Lynn said, troubles developed with how the ties were fused or welded to some rebar. To fix the problem, the county required fiberglass jacket wrappings around the columns.
That fix was expensive but very effective, Lynn said.
“Those columns are stronger now than they were before,” he said.
Shapiro & Sher Group’s Aaron Auxier said the cancellation of The Harmon condos is an “extreme letdown” for buyers as well as brokers who have been disappointed by a series of condo projects that have been ditched amid poor market conditions.
MGM Mirage bills The Harmon as a glamorous, boutique hotel with a spa and residences. Designed by Foster + Partners, it is an iconic, oval-shaped building at the northeast corner of CityCenter’s 67-acre campus, at Harmon Avenue and Las Vegas Boulevard.
Las Vegas nightclub operator Light Group is developing and managing the hotel for CityCenter joint venture partners MGM Mirage and Dubai World. Officials for Light Group could not be reached for comment.
“The Harmon is the premier condo destination for the celebrity clientele,” said Auxier, whose clients have signed purchase contracts for millions of dollars’ worth of penthouses at The Harmon.
MGM Mirage said today that buyers, who had signed purchase contracts for 88 of The Harmon's approximately 200 units, are entitled to refunds on their deposits. These deposits are likely worth tens of millions of dollars.
Buyers may also purchase units at other CityCenter buildings with condominiums, including Mandarin Oriental, Vdara and Veer Towers. Mandarin and Veer feature residential condos and Vdara is a condo-hotel building, with hotel rooms that can be owned by individuals and rented out to tourists.
Auxier's clients include musicians, athletes and other celebrities who sought out The Harmon because it was designed to provide them with privacy in addition to its other amenities.
With The Harmon Residences scrapped, Palms Place, a night life magnet for the Hollywood set adjacent to the Palms, will take the place of The Harmon as the “hippest condo address in the city”, he said.
Hahaha!
Palms Place is the "hippest condo address"?
Hahaha. Wow, we've really lowered the bar then. There are so many unsold units at Palm Place.
Union work at its best!!!!!!!
At The Harmon, "they ... installed it wrong. That's the bottom line," said Ron Lynn, Clark County Building Division chief. "They made a mistake."
So this would indicate the Union goofs read the plans wrong? Or did the structural engineer miscalculate the spacing or grade of the rebar? Either way, this is a critical mistake that would normally end up in court, but in this town, nobody-inspectors, engineers, workers-will be held liable. Just another Union led "Don't kill the job" campaign.
Note that MGM is still looking for money to complete the project, so this might be a convenient way to cut costs. With 4 or 5 thousand condos to sell in this rotten economy, they know they're in trouble.
That is my gut feeling that union workers did this on purpose. Rebar work is not brain surgery. Cutting into rebar is like punching holes into your gas tank. For it to be done on this high degree has to be intentional.
Why the inspectors did not catch it? Usually they do look for stabotage on this scale. I guess they know better now.
I worked at a place where pro-union forces on purposed sabotage the plant to make a point with the owners.
Some say that the word sabotage originated from activity where workers attempted to shut down shoe plants.
Unions seem to strive to destroy the industry that they are working in.
There are many examples of this.
Then they act all surprise when their jobs are destroyed.
Like here, if they stop building the condo then all those potential work hours to finish it are gone.
Woooooohooooo.....win one for the union.....they sure did send a clear message to those evil owners that send them checks.
Why exactly do we require union wages for all work on school building projects?
Hmmmm...higher quality......NOT!!!!!!!
I wonder if these problems would have been noticed if it wasn't for the engineer of record realizing there was an issue....
LasVegas2009...for your scheme to work then the union workers would have to intentional install rebar wrong and cut into rebar which is against their knowledge of rebar installation and work.
It means they would have to be co-conspirators with the owners and/or construction company.
There is only one logial explanation for all that lousy rebar work and cutting into rebar...sabotage by the union workers.
jfnance you make me so tired.
1. Check http://en.wikipedia.org/wiki/Sabotage for the actual origins of the word sabotage;
2. Read your posts before you send them, you contradict yourself constantly and/or your post makes little sense;
3. Use a spell checker;
4. Offer some CONSTRUCTIVE criticism for a change.
mld23:
You seem to be posting under a new name.
Otherwise, how could I make you so tired.
What....are you ashamed of your other postings?
Scary to think the building could topple over in very high winds or an earthquake. I'll NEVER stay in any of the rooms after that project is finished.
Nance; your union stance mimicks all yer rants.
they are bad bad bad.
All the workers are sad sad sad.
FORCED to work under union rules,
what are they thinking, those silly fools.
Low wages and crappy bennies, THATS what we need
to feed the Owners need for greed.
The 3rd party inspector did know the rod busters (ironworkers) were cutting the rebar. (They were not doing it to "sabotage" anything. They did it to make their job easier), but it was not per plan. The inspector allowed this to go on without reporting it, as he is required by codes and law to do. Thus, he took on the responsibilities of the registered licensed structural engineer, which he was not.
The sub-contractor knew what they were doing was not per plan, but continued to do it wrong anyway, saved time, thus they make more money.
Will anyone be held responsible for not complying with codes and laws, probably not. Sad, but that is the way it works on the "strip". Money talks.
Just look at the MGM-Mirage owned Monte-Carlo fire.
jfnance
I've been reading news articles in a variety of online publications, as well as the associated reader comments for months. This is the first time I've felt compelled to respond. Therefore a new user name.
Remember, just because you're paranoid, doesn't mean they're not out to get you.
@keebler - the best response yet to this.
Nance, just keep your Limbaugh porn to yourself. And you never did answer my question a few days ago about your military service. How about a little elucidation?
After reading this story, why would I step foot into one of these buildings? I wouldn't!
Dear Concerned City Center Investor,
My law firm, Lurie & Park LLP, practices in real estate litigation and is aware of investors growing concerns regarding delays in construction at the City Center, owned by MGM Mirage, and how it affects their investments.
It is clear that the developer has delayed construction. Because the developer is still struggling to acquire financing, this can lead to further delays, which can potentially span a number of years. The attorneys at my firm believe that there is a strong case that the developer is legally required to refund the deposits.
We hope to form a plaintiffs group to share in the costs of possible arbitration. The more buyers we represent, the more each saves in legal costs (e.g. 5 clients = 20% of legal costs for each client). If you are interested in joining the group, please contact me.
Dane Harrison Taylor
Case Manager
Lurie & Park LLP(310) 207-9400
Dear Concerned City Center Investor,
My law firm, Lurie & Park LLP, practices in real estate litigation and is aware of investors growing concerns regarding delays in construction at the City Center, owned by MGM Mirage, and how it affects their investments.
It is clear that the developer has delayed construction. Because the developer is still struggling to acquire financing, this can lead to further delays, which can potentially span a number of years. The attorneys at my firm believe that there is a strong case that the developer is legally required to refund the deposits.
We hope to form a plaintiffs group to share in the costs of possible arbitration. The more buyers we represent, the more each saves in legal costs (e.g. 5 clients = 20% of legal costs for each client). If you are interested in joining the group, please contact me.
Dane Harrison Taylor
Case Manager
Lurie & Park LLP(310) 207-9400
" Mr. Smith is Vice President, Regional Construction Manager at Converse working out of the Las Vegas Office. He has over 18 years of experience in Construction Inspection and is responsible for managing a staff of over 85 technical personnel. Mr. Smith has direct responsibility for managing all Converse materials testing and inspection projects in southern Nevada and Arizona. His duties include client management and relations, directing investigations for material failures, budget management, supervision of materials testing in both the field and laboratory, review of all inspections, development of concrete mix designs, preparation of final reports and direct supervision of all project managers. His project management experience includes responsibility for projects of various scopes and sizes, including high rise structures, hotel/casino properties, commercial developments, industrial buildings, parking structures, residential developments, flood control and pipeline projects, streets, highways, bridges, and utilities, as well as some of the largest, highest profile projects in company history." from Converse Consultants Web site www.converseconsultants.com