The document discusses potential impacts of a strike by operating engineers on New York City construction projects worth nearly $10 billion. It would affect over 11,000 construction workers and halt work on major developments involving thousands of workers. These include several large World Trade Center towers and other residential and commercial buildings. Developers and unions are in discussions to avoid a strike, while the city has declined direct involvement.

1. Construction & Design Real estate Weekly B5 Wednesday, June 29, 2011
Strike could halt $10B in projects, warns REBNY
By Roland li members, and Local 14 has ect would affect 1,000 work-
A potential work stoppage around 1,600. Major proj- ers. One site that will likely
by operating engineers could ects that would be affected weather a strike is One World
jeopardize new construction by a strike include Silver- Trade Center, where unions
projects worth nearly $10 stein Properties’ trio of World reportedly would not want
billion, affecting 11,300 con- Trade Center towers, whose to be seen as an obstacle to-
struction workers, according costs total $3 trillion and in- wards completing the highly
to data from the Real Estate volve 1,100 workers. symbolic project.
Board of New York. Work could be halted at Developers and union of-
Operating Engineers Local Extell Development Co.’s ficials are currently in discus-
14 and 15 are seen as the most $240 million International sions. The city has declined
likely group to strike, in part Gem Tower at 44 West 47th to become involved, because
because of their lucrative, six- Street and $500 million resi- officials say that the talks are
figure salaries that developers dential and hotel project at between private groups.
are seeking to cut. 157 West 57th Street, which “There’s a lot of hard-
Operating engineers con- is planned to be the tallest working men and women that
trol movement of personnel residential tower in the city. want to continue to work and
and materials and are a crucial Those two projects in- a lot of projects throwing a lot
Admirals Row will have a supermarket, retail space and 127,000 s/f of industrial space. part of construction projects, volve some 1,350 construc- of money into the economy
but their contracts expire on tion workers. A stoppage at that we don’t need to stop,”
Review process underway June 30.
Local 15 has around 4,800
Forest City Ratner’s $800
million Barclays Center proj-
said Steven Spinola, president
of REBNY, told Crain’s.
for Admirals Row project DOB ammends insurance regs
Public review for the transfer of the six- property from the federal government through The New York City De- to the attention of the New
acre Admirals Row site at the Brooklyn Navy the National Guard Bureau to the City of New partment of Buildings recent- York State Bar Association,
Yard from the federal government to the City York, which owns the 300-acre Brooklyn Navy ly amended its regulations the Construction Law Com-
of New York got underway lats week Yard property. with respect to insurance that mittee of the Association
Deputy Mayor for Economic Develop- The designated developer would en- must be obtained by builders assembled a Task Force on
ment Robert K. Steel and Brooklyn Navy ter into a long-term lease for the site that in order to obtain permits. Construction Insurance to
Yard Development Corporation President and now houses 12 dilapidated and unused struc- The objective, at least in negotiate a solution with the
CEO Andrew H. Kimball said that, after the tures. part, was to reduce the City’s City , headed by construction/
transfer, the site will become part of Brooklyn The plan includes the restoration of two of exposure to loss when things insurance attorney Kevin J.
Navy Yard. the structures — Building B and the Timber go wrong on construction Connolly of Anderson Kill &
BNY Development Corporation, which Shed — which would be incorporated into the sites. The resulting regulation, Olick. After the Task Force
manages the 300-acre industrial park on be- new development. however, contained require- conveyed its concerns to
half of the City, will oversee redevelopment The development of Admirals Row will con- ments compliance with which the City’s Department of
of the site, creating a 74,000 s/f supermarket tinue the expansion underway at the Brooklyn was literally impossible. Buildings, the Department
and 79,000 s/f of retail space and 127,000 s/f Navy Yard — its largest growth since WWII, Left unchanged, the reg- promptly scheduled a con-
of industrial space. adding more than 1.5 million square feet of ulation would either have sultative meeting and began
The Department of City Planning certified new space and 2,000 new jobs. ended the issuance of building its own work on a proposed KEVIN CONNOLLY
the project’s land use application, beginning The Yard’s existing four million square permits or would have lim- solution.
the seven-month-long public review process. feet of space — currently consisting of 40 ited the issuance of permits As originally drafted, the evening of June 21, 2011,
The project is expected to create 500 per- rentable buildings with more than 275 tenants to those who were able to Regulation demanded that the Department of Buildings
manent retail and industrial jobs and hundreds — is 99% occupied and 5,800 people come secure certificates of dubious the insurance policies lack announced its policy in con-
of additional construction jobs. to work at the Navy Yard every day, up from integrity. a “contractual liability ex- nection with the enforcement
“We are thrilled to be one step closer to 3,600 in 2001. When the situation came clusion,” which means that of the new regulation:
delivering on our longstanding commitment the insurance company does “The Department of Build-
to create 500 industrial and retail jobs on not cover the policyholder
the Admirals Row and bring access to fresh,
affordable produce to the community,” said
Sorkin to lead ‘super jury’ at WAF for breaches of contract and
the consequences of those
ings has fully considered the
comments contained in your
email and the attached memo-
Andrew H. Kimball, president and CEO of World Architecture Festival (WAF) 5,000-unit community in Penang, breaches. The problem is randum regarding Section
the Brooklyn Navy Yard Development Cor- has confirmed Michael Sorkin will Malaysia, master planning for the Zha that substantially all liabil- 101-08 (Required Insurance
poration. head-up the ‘super-jury’ at this year’s Bei district in Shanghai and the design ity insurance contains this and Indemnification) of the
“We look forward to gaining input during WAF Awards, to determine which of a town of 40,000 on the Black Sea exclusion, because liabil- Department’s Rules, and has
each step of the process on a project that will building will be crowned World in Turkey. ity insurance protects against decided to take the following
incorporate significant historic preservation Building of the Year 2011. Entries for the WAF Awards close accidents, not breaches of action:
into a uniquely attractive and sustainable site Sorkin is principal of the Michael July 1. contract. However, there are (1) The Department will
plan.” Sorkin Studio in New York City and Joining Sorkin on the super-jury provisions, known as the “In- post a notice on its website to
Following completion of the public review one of the most influential architec- will be: Ben van Berkel, UNStudio, sured Contract Exception,” the effect that subdivision (d)
process, Brooklyn Navy Yard Development tural and urban designers practising Rotterdam; Jo Noero, Noero Wolff that restore coverage for some (1)(i)(E)(1)(3) is clarified in
Corporation will issue a request for proposals today. Architects, Cape Town; Odile Decq, indemnity agreements, and the following way: the words
to select a developer for the project. Recent projects include planning ODBC, Paris; and Professor Kongjian it is on that exception rather “contractual liability exclu-
If it is approved, the project would break and design for a sustainable city of Yu, Principal of Turenscape, Bei- than the whole exclusion, that sion” may be understood as
ground in 2012 following the transfer of the 300,000 near Wuhan in China, a jing. the City’s attention needed to “an Insured Contract Excep-
be focused. tion no less favorable to the
A second problem stemmed insured than ISO Form CG
from the City’s insistence that 00 01 (12/07 ed.).”
before a construction policy (2) The Department will
could be cancelled, written not enforce subdivision (d)(1)
notice had to be given to the (i)(F) beyond what is already
City. The issue of who is noti- required under New York In-
fied of an insurance cancella- surance Law regarding notice
tion has been an ongoing one, of cancellation or termination
and it is likely that the last of general liability insurance
word has not been spoken: but policies.”
the current state of the market Kevin J. Connolly, chair
provides for notice only to of the Insurance Task Force,
the “First Named Insured,” commented, “The Depart-
and that is the developer, not ment’s announcement accom-
the City. plished the urgently-needed
Responding promptly to changes that were the focus of
a Task Force enumeration of the State Bar Task Force. We
these problems and recom- appreciate the speed with
mended amendments, on the which the City responded to
this challenge. “