The Meriwether Homeowners Association has sued Gerding Edlen Development Company and its partners, seeking $5.2 million for various "defects, resultant leaks and property damages.â
Gerding Edlen CEO Mark Edlen says the allegations in the lawsuit are âunfoundedâ and declined further comment.
It's hard to imagine now, but when developers Gerding Edlen started marketing the 245-unit Meriwether back in 2004, the project, which includes two towers and 17 townhouses, nearly sold out at prices ranging from $759,000 to $1.4 million before the first shovel of dirt was turned. Demand grew so strong for adjacent projects that Gerding Edlen had to take legal steps to discourage speculators.
But the lawsuit in Multnomah County Circuit Court is potentially embarrassing for a couple of reasons.
For starters, Gerding Edlen is the city's pre-eminent developer, responsible for much of South Waterfront, as well as the Indigo in the West End, the Brewery Blocks, and the U.S. headquarters of Vestas in the Pearl District. Gerding Edlen is also on tap to develop the proposed Oregon Sustainability Center.
Second, Dennis Wilde, a partner at Gerding Edlen, the firm's "chief sustainability officer" and the man most responsible for the firm's reputation as a leading developer of green buildings, is himself a resident of the Meriwether.
In fact, the project bears one of Wilde's signature design elements—green eco-roofs, which are supposed to reduce runoff, save energy and even create wildlife habitat.
But the green roofs are a big part of the problem.
A consultant's report, prepared for the homeowners, says the roofs need more than $200,000 in repairs for "excessive runoff issues" and "vegetative growth and sustainability problems.â
But building residents are more worried about what's beneath the roofs than what's on them.
âOur biggest problem is garage drains that donât work,â says Jim Atwood, chairman of the Meriwether Homeowners Association.
Atwood, a real estate investor who owns downtown properties, says the condo board hoped for a speedy resolution, but the lawsuit has now been put on hold and the sides will enter mediation in June.
In a presentation to the homeowners association March 26, the Aldrich Eike law firm, which specializes in construction-related litigation, outlined problems with the building. The law firm described the most expensive issue as "continued leaking in parking garage due to cracks in concrete slab and inadequate waterproofing."
One of the challenges in South Waterfront—as the neighborhood's name suggests—is that it's built along the Willamette River. Water infiltration into underground parking is a threat.
The homeowners' consultant found excessive cracking in the Meriwether's parking garage as well as poor-quality concrete. Estimated price to fix: $2.7 million.
The law firm also presented homeowners with allegations of faulty dryer-duct work, sprinkler pipes located too close to flues, and other construction flaws.
"It looks to me like the workers just disregarded the plans," Atwood says.
The legal battle does not serve the interests of either side in the fight. Condo owners would like to preserve what they can of their property values—which have plummeted—and publicity about construction defects won't help.
Nor does it help Gerding Edlen, which has reinvented itself during the development slowdown. The firm is promoting its "Sustainable Solutions" division, which aims to retrofit existing buildings to bring them up to the same green standards of Leadership in Energy and Environmental Design as the 41 other LEED-certified buildings Gerding Edlen has developed.
Atwood is optimistic that the Meriwether building is fundamentally solid.
"The building envelope is sound," he says. "No water has gotten through the windows or the shell. It's a headache, but [$5.2 million] is a pretty small slice of the buildingâs value.â