For many contractors, winning a multi-million-dollar bid on a building project in Austin would be a dream. But after you contribute over $3 million worth of labor and materials, you’re stuck waiting for a check from the owner. There’s no way to take back the work, time, money, and energy you’ve already invested into the project. So, what do you do when you aren’t paid for construction work? That’s the situation these contractors in Travis County found themselves in during June 2019. Like so many other construction companies burned on payment, they made moves to get their money by filing a mechanics lien.
These lien filings should remind you how important it is for construction companies to protect their right to file a mechanics lien on every job. No one starts a construction job thinking they won’t get paid. We don’t know if these contractors will eventually recover payment. We do know that filing a lien is an incredibly effective way to get paid. Hopefully these construction businesses resolve their disputes amicably, and go on to build great things in the Lone Star State.
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Austin: $3.26 million lien on The LINE Austin hotel
Lien Amount: $3.26 million
Claimant: Structure Tone Southwest, LLC
Hiring Party: Downtown Austin Lakeside, LLC
Property Address of Lien: 111 East Cesaar Chavez Street, Austin, TX
Property Owner: Downtown Austin Lakeside, LLC
Structure Tone Southwest, LLC is on this list twice – once as a claimant, another with a claim against them. That shouldn’t be a total shock, since construction payments flow down from the top. If the owner doesn’t pay the general contractor, the GC won’t be able to pay the subs.
Structure Tone filed the largest lien for the month against The LINE Austin, a boutique hotel in downtown Austin. Structure Tone is a construction management and general contracting company, founded in 1977 in Dallas. They’ve completed jobs all over the country, from hotels to hospitals to the headquarters of DraftKings. On this project, they filed the lien for a whopping $3,262,664 after going unpaid by Downtown Austin Lakeside, LLC.
The property, a LINE hotel, is owned by Downtown Austin Lakeside, LLC. Texas is seeing increases in hotel growth, especially in and around Dallas. Texas subcontractors take note: You can file liens on a hotel when you are subcontracting in Texas.
Austin: $1.4 million lien on Executive Suites at Flintrock
Lien Amount: $1.4 million
Claimant: Assurance Home Warranty Group, LLC
Hiring Party: Tyson & Blanchard Group, LLC
Property Address of Lien: 2802 Flintrock Trace, Suite B 102, Austin, TX
Property Owner: MRG ATX Holdings LLC
Assurance Home Warranty Group, LLC filed the second largest lien filed of the month. They filed a lien of $1,418,178 for construction, remodeling, and improvement repair. The property, Executive Suites at Flintrock, is a hotel owned by MRG ATX Holdings.
The general contractor on the project, Tyson & Blanchard Group, LLC, were also featured in our top 5 largest liens article for May in Travis County. MRG ATX Holdings has a number of construction projects going on around the site with varying completion dates.
Austin: $1 million lien on a private residence
Lien Amount: $998k
Claimant: Real Granite, Inc.
Hiring Party: Balfour Beatty Construction, LLC
Property Address of Lien: 1000 East 8th Street, Austin, TX
Property Owner: 3rd & West LP
Real Granite, Inc. filed the third largest lien in Travis County, for nearly a million dollars. That’s a substantial amount, considering that the property is a 3,600 square foot home. Real Granite, a San Antonio-based stone contractor, provided interior stone on the project owned by 3rd & West LP. According to the lien paperwork, Real Granite covered exactly 76,744 square feet of area.
The general contractor on the project, Balfour Beatty Construction, LLC, has been in the slow-paying spotlight before. This is the second month in a row Balfour Beatty has been featured in Travis County’s biggest liens.
Balfour Beatty has been in business since 1933, and they manage projects around the world. Back in April 2019 they got media attention in the UK for failing to comply with Prompt Payment Code. As a result, Balfour Beatty was barred from winning public projects until they start paying their subs and suppliers on time.
Austin: $682k lien on The Tyndall luxury condos
Lien Amount: $682k
Claimant: BCS Concrete Structures, LLC
Hiring Party: White Construction Company
Property Address of Lien: 800 Embassy Drive, Austin, TX
Property Owner: Tyndall Partners, LP
BCS Concrete Structures, LLC filed the fourth largest lien filed for the month in Travis County. They filed a lien claim of $682,107.27 for work on The Tyndall at Robertson Hill, a condominium development in Central East. BCS Concrete Structures, based in Buda, Texas, provides preconstruction planning and construction management on…wait for it…concrete structures.
White Construction Company was the hiring party on the job at 800 Embassy Drive. Tyndall Partners, LP was the property owner.
Austin: $620k lien on The LINE Austin hotel
Lien Amount: $620k
Claimant: Zelham, Inc
Hiring Party: Structure Tone Southwest, LLC
Property Address of Lien: 111 East Cesar Chavez, Austin, TX
Property Owner: Downtown Austin Lakeside
Zelham, Inc. filed the fifth largest lien for $620,902.54 against Structure Tone Southwest, LLC. Zelham, Inc., a contractor from Boise, Idaho, provided remodeling and finishing work for the hotel.
You’ll remember Structure Tone from the beginning of this article, where they claimed the #1 spot on this list of biggest liens. It appears that Structure Tone was the general contractor on the project. Since they weren’t paid by the property owner (Downtown Austin Lakeside), it makes sense that they wouldn’t have paid their subcontractors, either. If you looked further down the list of liens this month, you’d likely see this project again.
The five largest lien filings in Travis County total nearly $7M
The top 5 liens, totaling nearly $7 million, made up more than half of all lien filings in Travis County. Overall in June 2019, 134 liens were filed by 90 different businesses for a total of $12.5 million. The smallest lien claim was for just $132.
Texas cities are in the middle of a construction boom. The central Texas housing market is on track to reach its ninth year in a row of hitting all-time highs in home sales.. In order to keep up with rising demand, developers often take financial risks, launching projects before funding is entirely in place. Unfortunately, contractors and suppliers wind up shouldering most of the payment risk.
Texas has some of the most complex construction laws in the country. It’s crucial for construction companies working in the state to understand their requirements and responsibilities. If you don’t follow the state’s strict rules, you run the risk of not getting paid. Before you start a construction project in Texas, brush up on our guide to Texas Monthly Notices, and read about the state requirements for lien waivers.