Liens filed as Burnham 310 developer fights with subcontractor
CHAMPAIGN – The Burnham 310 apartment project is getting closer to completion, but a dispute between the developer and the structural concrete subcontractor has led to a foreclosure lawsuit and the filing of $4.7 million in mechanics' liens against the developer.
The dispute has led to a number of subcontractors, some of them local, not being paid for work they did months ago.
Bacon & Van Buskirk Glass Co. of Champaign is owed $280,000, while Blager Concrete of Urbana is owed $48,000, according to the liens they filed at the Champaign County Recorders' office.
"We've asked to be paid on several occasions and in several ways," said Rod Van Buskirk, owner of Bacon & Van Buskirk Glass. "We're hopeful this can be resolved in timely fashion."
The Burnham 310 project is an 18-story apartment building on Springfield Avenue that rises high on the Champaign skyline. With 259 apartments, it was supposed to be finished June 30 and ready for fall 2008 leasing, according to Louis Pickus, president of The Pickus Cos. of Highland Park.
The Pickus Cos. is developing the $50 million project in partnership with the Illinois State Board of Investment, a state pension fund. The pension fund owns 95 percent of the project, with $13 million in equity and $37.5 million in debt, according to William Atwood, executive director of the Illinois State Board of Investment. The Pickus Cos. holds a 5 percent interest in the project as a development fee, he said.
Because of delays, it wasn't until Nov. 12 that apartments on Burnham 310's first six floors were finally occupied.
"Obviously, the project wasn't completed when it was supposed to be," Louis Pickus said. "It just didn't work out."
Floors seven through 18 are nearly finished now and it is mainly outside sidewalk work that is preventing the city of Champaign from issuing an occupancy permit, he said.
"Unfortunately, with the weather, it's hard to pour concrete," Pickus said. "We need a break in the weather."
Garry Bowman, Champaign's building safety supervisor, agreed that the project is nearly finished, with "a lot of real little things they need to address."
But looming over the project is a dispute between The Pickus Cos. and its structural concrete subcontractor, Jacobsmeyer-Mauldin Construction Co. of Pacific, Mo., with both blaming each other for the delays.
Jacobsmeyer-Mauldin filed a $3.7 million mechanics lien on Nov. 12 at the county recorder's office, alleging it was owed that much money by Pickus Construction and Equipment Co., the general contractor for the Burnham project, and ISBI-Pickus Burnham Apartments LLC, an investment vehicle that holds the Burnham property.
On Dec. 18, Jacobsmeyer-Mauldin filed a petition in Champaign County Circuit Court seeking to intervene in a foreclosure lawsuit brought by another subcontractor on the project, Bri-Tech of Rantoul, which contends it is owed $12,153. The petition to intervene has not yet been scheduled for hearing.
Jacobsmeyer-Mauldin alleges it is owed $1.1 million for work related to its original $10.5 million structural concrete work contract, another $849,000 in extra work and $1.7 million for delays in completing the work, for a total of $3.7 million.
"Our position is we have not caused these delays and it's been others, primarily Pickus, that's responsible for the delays," said attorney J.D. Glisson of Greensfelder Hemker & Gale, a St. Louis law firm representing Jacobsmeyer-Mauldin.
There were a number of days when Jacobsmeyer-Mauldin could not work because other subcontractors were doing priority work or high winds prevented the use of the tower crane, Glisson said. He noted Pickus Construction and Equipment Co. was the project's general contractor.
Pickus puts the blame for the delays squarely on the concrete subcontractor. He said the 18th floor was supposed to be "topped off" in February, but wasn't done until May.
Pickus said he told Jacobsmeyer-Mauldin officials: "You guys were driving the train, and now you say you want another $1.7 million because you're late?"
Both sides say the payment dispute has prompted Jacobsmeyer-Mauldin to not pay some subcontractors.
But Atwood said Wednesday the subcontractors will be paid within the next several days, which would leave just the main dispute to be resolved.
The Illinois State Board of Investment, which manages pension assets for state employees, judges and legislators, is still confident the project will be a good investment, Atwood said.
"We missed the opening of school, but the long-term prospects are just terrific," he said.
Atwood said a portion of the pension fund's investments are allocated toward Illinois real estate projects, and that's how the fund came to invest in Burnham 310.