Dispute Halts Work on West Edge Project

Dispute Halts Work on West Edge Project

The troubled West Edge has been hit by more turmoil with the contractor and developer trading accusations about missed payments, pushing the high-profile project’s timetable further behind. J.E. Dunn Construction Co. confirmed Wednesday it has stopped work on the $130 million development being built at 48th Street and Belleview Avenue near the Country Club Plaza, saying the developer has failed to fulfill contract obligations.

“The developer has payment obligations as part of the contract that the developer has missed for work performed,” said Dirk Schafer, the project executive. “J.E. Dunn has notified the developer we cannot and will not perform work without being paid.” David Domina, the attorney representing the developer, Trilogy Development Co., said the contract allows Trilogy to withhold payment when there is a dispute about the quality of work or other performance issues.

The dispute is the latest in a series of problems for the ambitious project first announced more than four years ago. Bob Bernstein, the founder of Bernstein-Rein Advertising, said then he wanted to build an architectural showcase that would house his advertising firm and be a tribute to the Plaza. After interviewing some of the world’s top architects, Bernstein hired Moshe Safdie as the designer and established Trilogy to develop the project. J.E. Dunn was selected as the contractor, and work started in December 2005. At the time, the project was expected to be occupied by early 2008. That date has now been shoved back to next spring at the earliest, according to Domina.

“It’s a very deep disappointment to the developer,” he said.

Last summer, Trilogy was sued by J.E. Dunn over the actual cost of building the development, which includes a 205,000-square-foot office building with a dramatic interior courtyard, and a 131-room boutique hotel. The dispute remains the subject of arbitration, with both sides reportedly as much as $30 million apart. Last month, Trilogy was accused by the city’s Human Relations Department of failing to reach its affirmative action goals for hiring minority contractors and not making a best faith effort to do so. The Kansas City Tax Increment Financing Commission, which supported $31.6 million in tax-increment financing assistance for the project, is continuing to review that allegation. Should the TIF Commission support the city findings, the developer could face millions of dollars in penalties.

Domina said Trilogy’s latest problem with J.E. Dunn stems from concerns over whether subcontractors are being paid. “We have concerns about the status of payments to subs, whether they’re current or not,” he said. “We’ve taken it to the arbitration panel and hope to have it resolved.”

Having the dispute in arbitration for more than a year hasn’t helped, Domina said. “The process has not created an environment in which the two parties have been able to resolve differences over the guaranteed maximum price or the completion schedule,” he said. “It’s very badly past the anticipated completion date.”

Officials at two subcontractors, Mark One Electric and Rodriguez Mechanical, declined to comment.

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