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Real Estate & Construction News Round-Up (10/05/22) – Hurricane Ian, the Inflation Reduction Act, and European Real Estate

October 24, 2022 — Pillsbury's Construction & Real Estate Law Team - Gravel2Gavel Construction & Real Estate Law Blog
This week’s round-up features Hurricane Ian’s effect on the construction labor pool, the Inflation Reduction Act’s projected impact on the real estate and construction industry, Europe’s real estate market, and more.

• The Inflation Reduction Act (IRA), designed to reduce the nation’s carbon footprint by jump-starting innovation and adoption of cleaner energy sources, also contains large segments aimed at real estate and construction. (Chava Gourarie, Commercial Observer)
• Damage caused by Hurricane Ian’s massive storm surge, flooding and winds is projected to hike demand for experienced construction workers. (Zachary Phillips, Construction Dive)
• According to the National Multifamily Housing Council’s monthly construction survey released Sept. 29, 2022, almost all developers are experiencing construction delays. (Paul Bergeron, Globest)

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Reprinted courtesy of Pillsbury's Construction & Real Estate Law Team

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Hunton Insurance Group Advises Policyholders on Issues That Arise With Wildfire Claims and Coverage – A Seven-Part Wildfire Insurance Coverage Series

June 27, 2022 — Scott P. DeVries & Yosef Itkin - Hunton Insurance Recovery Blog
Wildfires destroy millions of acres a year in the United States, spewing smoke across much of the nation. The cost of damage alone over the past several years soars into the hundreds of billions. As wildfires continue to spread, particularly as we enter wildfire season, policyholders’ claims will rise and with that, so too will wildfire insurance coverage issues. Many believe that when a fire damages their property and/or interrupts their business operations, a claim gets submitted and is automatically paid; sadly, this is often not the case. In a seven-part series delving into issues relating to wildfire insurance coverage, the Hunton insurance group provides a comprehensive understanding of the types of policies that may be available, legal and factual issues that may arise, and steps policyholders can take – both in advance and during the claims process – to maximize recovery. The following issues will be addressed:

• Part One: Types of Wildfire-Related Losses and the Policies That May Provide Coverage
• Part Two: Coverage for Smoke-Related Damages
• Part Three: Standard Form Policy Exclusions
• Part Four: Coverage for Supply Chain Related Losses
• Part Five: Valuation of Loss, Sublimits, and Amount of Potential Recovery
• Part Six: Ensuring Availability of Insurance and State Regulations
• Part Seven: How to Successfully Prepare, Submit and Negotiate the Claim

Reprinted courtesy of Scott P. DeVries, Hunton Andrews Kurth and Yosef Itkin, Hunton Andrews Kurth Mr. DeVries may be contacted at sdevries@HuntonAK.com Mr. Itkin may be contacted at yitkin@HuntonAK.com Read the court decision
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Discussing Parametric Design with Shajay Bhooshan of Zaha Hadid Architects

May 10, 2017 — Aarni Heiskanen - AEC Business
obotics, 3D printing, and digital fabrication—these evolving technologies are changing how we design and construct. Looking into the future can surprisingly cause us to rediscover history, as I learned when discussing parametric design with Shajay Bhooshan. During the AEC Hackathon Munich in April 2017, I became acquainted with Shajay Bhooshan, associate at Zaha Hadid Architects. Shajay showed me designs that were intriguingly reminiscent of natural forms but completely modern in expression. He explained how these lightweight structures had been digitally designed and constructed with minimal use of material. One of the examples he shared was a large shell structure that consisted of aluminium elements that could be assembled and dismantled easily. Read the court decision
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Reprinted courtesy of Aarni Heiskanen, AEC Business
Mr. Heiskanen may be contacted at info@aepartners.fi

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California Expands on Scope of Coverage for Soft Cost Claims

February 14, 2023 — Caitlin N. Rabiyan - Saxe Doernberger & Vita, P.C.
The California federal district court case of KB Home v. Illinois Union Insurance Co., No. 8:20-cv-00278-JLS-JDE, (C.D. Cal. August 23, 2022), provides much needed guidance for cases involving builder's risk insurance claims for soft cost coverage. The case stems from damage to several of KB Home’s residential building sites caused by a severe rainstorm in January 2017. Each home site was a smaller part of a large housing development project. The damage caused significant delay in the completion of some individual home sites, although there was limited evidence of delay to the overall housing development project. As a result, KB Home sought coverage under a builder’s risk policy purchased from Illinois Union for both hard costs and soft costs. “Hard costs” are the costs directly associated with repairing property damage to the sites. Conversely, “soft costs” are indirect expenses associated with project delays caused by such property damage and repair efforts. For example, hard costs would include labor and materials, whereas the soft costs claimed by KB Home included additional real estate taxes, construction loan interest, and advertising and promotional expenses incurred because of the delays. Illinois Union paid the claim for the hard costs, but denied the soft costs claim. KB Home filed suit and Illinois Union eventually filed a motion for summary judgment. Read the court decision
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Reprinted courtesy of Caitlin N. Rabiyan, Saxe Doernberger & Vita, P.C.
Ms. Rabiyan may be contacted at CRabiyan@sdvlaw.com

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Florida’s New Civil Remedies Act – Bulletpoints As to How It Impacts Construction

April 10, 2023 — David Adelstein - Florida Construction Legal Updates
There has been much talk about Florida’s new Civil Remedies Act (House Bill 837) that Governor DeSantis approved on March 24, 2023. As it pertains to construction, here is how I see it with key bulletpoints on the impact this new Act has on the construction industry:

• New Florida Statute s. 86.121 – This is an attorney’s fees statute for declaratory relief actions to the prevailing insured to determine insurance coverage after TOTAL COVERAGE DENIAL. (Note: A defense offered pursuant to a reservation of rights is not a total coverage denial.) This right only belongs to the insured and cannot be transferred or assigned. And the parties are entitled to the summary procedure set forth in Florida Statute s. 51.011 requiring the court to advance the cause on the calendar. The new statute does say it does NOT apply to any action arising under a residential or commercial property insurance policy. (Thus, since builder’s risk coverage is a form of property insurance, the strong presumption is this new statute would not apply to it.) Rather, the recent changes to Florida Statute s. 626.9373 would apply which provides, “In any suit arising under a residential or commercial property insurance policy, there is no right to attorney fees under this section.”
• Florida Statute s. 95.11 – The statute of limitations for negligence causes of action are two years instead of four years. This applies to “causes of action accruing after the effective date of this act.”

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Reprinted courtesy of David Adelstein, Kirwin Norris, P.A.
Mr. Adelstein may be contacted at dma@kirwinnorris.com

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Renovation Makes Old Arena Feel Brand New

February 15, 2021 — Jim Parsons - Engineering News-Record
Since opening its doors in 1992, Phoenix’s downtown sports and entertainment arena has hosted hundreds of exciting contests involving the hometown Phoenix Suns and Phoenix Mercury professional basketball teams as well as high-profile concerts and other events. Reprinted courtesy of Jim Parsons, Engineering News-Record ENR may be contacted at ENR.com@bnpmedia.com Read the full story... Read the court decision
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General Partner Is Not Additional Insured For Construction Defect Claim

August 26, 2015 — Tred R. Eyerly – Insurance Law Hawaii
The court determined that the project owner's general partner was not an additional insured entitled to a defense and indemnity against claims for construction defects. St. Paul Fire & Marine Ins. Co. v,. Cypress Fairway Condo. Ass'n, 2015 U.S. Dist. LEXIS 94012 (M.D. Fla. July 20, 2015). Construction of the Cypress Fairway Condominium project took place in 1999 and 2000. Cypress Fairway Ltd. ("Cypress") was the owner and Vineland Partners , LLC ("Vineland") was its general partner. The general contractor was Winter Park Construction Company ("WPC"). Water intrusion and property damage occurred, but it was unclear when or whether the damage was known. Cypress' expert indicated that the damage began shortly after the end of construction. In 2004, the complex was sold to Cypress Madison Ownership Company. In 2010, the Cypress Fairway Condominium Association sued Cypress and Vineland. Count V of the underlying complaint asserted there were construction defects that Cypress and Vineland were responsible for when they owned and managed the project. Count VI alleged that Cypress and Vineland negligently supplied information which the Association relied on for the purchase of the condominiums. Read the court decision
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Reprinted courtesy of Tred R. Eyerly, Insurance Law Hawaii
Mr. Eyerly may be contacted at te@hawaiilawyer.com

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A Reminder to Get Your Contractor’s License in Virginia

April 25, 2023 — Christopher G. Hill - Construction Law Musings
How are ducks and contractors alike? A question I get often, particularly from construction contractors outside of Virginia is whether they need to get a Virginia contractor’s license. The answer is almost invariably “yes.” The next question is why? The answer is almost always “Because state law says so.” With some minor exceptions for material suppliers and the like, Virginia law requires that all of those that perform construction for others carry the proper license and specialization for the work performed. There is no exception for the proverbial “paper contractor” that takes money from an owner and subcontracts all of the actual physical work. It does not matter if you use a different term for what you do for the owner. If it walks like a duck and quacks like a duck. . .its a duck. If you take money to perform construction, you’re a contractor. Some of the consequences of contracting without a license (aside from possible criminal charges) include among other things, the inability to perfect a mechanic’s lien under Va. Code 43-3(D) and, with minor exceptions, the ability to enforce a contract (meaning it really hurts your ability to get paid). Read the court decision
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Reprinted courtesy of The Law Office of Christopher G. Hill
Mr. Hill may be contacted at chrisghill@constructionlawva.com

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