Even as the construction industry looked towards financial improvements following a tumultuous 2020, not everything was easy for contractors.
Some of the most significant contractors in the country dealt with nonpayment this past year — and in a major way, with companies filing staggeringly high lien claims: The top 5 alone are worth almost half a billion dollars combined.
Mechanics liens are legal claims for nonpayment in construction work. Filing a mechanics lien gives a contractor a secured interest in a property, clouding ownership and slowing the flow of funds on a project — meaning that everyone involved in a project is going to want to make sure a lien is resolved, and that process is especially true on huge projects like these.
10. Nestle Purina Production Plant: $33 million lien
Location: Clinton, Iowa
Project address: 2200 Manufacturing Drive
General contractor: Dennis Group
Claimant: Dennis Group
Following Nestle Purina’s 2020 announcement of its plans to invest $140 million in the expansion of its Clinton, Iowa factory, things haven’t gone anywhere near as smoothly as the company would have wished. The most significant of the liens currently active on the property is general contractor Dennis Group’s $33,533,401.54 claim — but it’s far from the only one.
There are at least 26 active liens on the project, ranging from the project’s general contractors to subcontractors and suppliers, showing that the expansion has had a larger problem with payment than simply one party’s issues.
9. Microsoft Technology Center: $39 million lien
Location: Mountain View, California
Project address: 1065 La Avenida Street
General contractor: Rudolph and Sletten
Claimant: Rosendin Electric
The construction of Microsoft’s new Technology Center in Silicon Valley faced its fair share of payment setbacks in 2021, with at least eight active liens remaining on the property — with subcontractor Rosendin Electric’s $39,572,694 claim topping the others significantly.
All of the liens filed on the project have been filed by subcontractors, displaying that there may possibly be an issue with payment on the behalf of Rudolph and Sletten. Certainly, this is something that Microsoft will want to get cleared up, as the company is focused on continuing to expand their presence in Silicon Valley.
8. Total Petrochemicals Port Arthur Facility: $43 million lien
Location: Port Arthur, Texas
Project address: 7600 32nd Street
General contractor: Structure Tone
Construction of Total Petrochemicals’ new standalone plant at its Port Arthur, Texas facility — purportedly a $1.7 billion project — has been impacted by a number of issues surrounding slow payment and nonpayment in the previous few years. Though it’s not the only lien filed against the project, BrandSafway’s $42,996,667.03 lien on the project is certainly the most significant.
This Total Petrochemicals project has a history of liens and slow payment going back to 2018, with at least five mechanics liens remaining active.
7. Monarch Casino Black Hawk: $45.5 million lien
Location: Black Hawk, Colorado
Project address: 488 Main Street
General contractor: PCL Construction Services
Claimant: PCL Construction Services
General contractor PCL Construction Services filed a mechanics lien totaling $45,528,865.97 on the Monarch Casino property on March 10, 2021, after its significant property expansion efforts.
They aren’t the only contractors who’ve had payment issues with the expansion, either. Subcontractors Weifield Group Contracting Inc., Summit Sealants Inc., Floorz LLP, Spacecon Specialty Contractors LLC, and Heggem-Lundquist Paint Company all filed mechanics liens on the property in February 2021, with many of the lien amounts being for millions of dollars.
6. Four Seasons Residences: $48 million lien
Location: San Francisco, California
Project address: 706 Mission Street
General contractor: Webcor Builders
Claimant: Webcor Builders
Webcor Builders served as the general contractor on the Four Seasons Residences at 706 Mission while also performing a significant amount of work itself on the project, such as concrete, millwork, and carpentry work.
The project includes two buildings which have 146 combined condominium units alongside a new Mexican Museum, with notable tenants such as NBA star Steph Curry being among those who have purchased one of the buildings’ condominiums.
Though the completed project eventually welcomed its first residents in May 2021, Webcor previously filed its mechanics lien for $47,682,427.63 on the project on February 24, 2021.
5. SoFi Stadium: $53.3 million lien
Location: Los Angeles, California
Project address: 1050 S Prairie Avenue
General contractor: Turner Aecom Hunt
Claimant: Rosendin Meadow Joint Venture
Even the most high-profile of projects face payment issues. From large claims to small claims, Los Angeles’ SoFi Stadium — home of the National Football League’s Los Angeles Chargers and Los Angeles Rams — has dealt with a huge number of them in the past year, with the most significant coming from a lien filed by the Rosendin Meadow Joint Venture on May 24, 2021.
Rosendin Meadow’s still-active lien is for a staggering $53,374,423. The company was hired by general contractor Turner Aecom Hunt, completing its work on the project prior to completion in September 2020.
It’s far from the only lien on the project. There are as many as 11 active mechanics liens currently on SoFi Stadium, with others being as significant as $28 million.
4. Circa Resort and Casino: $54 million lien
Location: Las Vegas, Nevada
Project address: 8 Fremont Street
General contractor: McCarthy Building Companies
Claimant: McCarthy Building Companies
Described at its onset as a project “in the neighborhood of $1 billion,” the Circa Resort and Casino in downtown Las Vegas, Nevada was impacted by a serious lien this past winter.
McCarthy Building Companies filed a lien against the property on February 26, 2021, claiming a total of $54,104,721.36 in nonpayment after serving as the project’s general contractor.
According to the company, the project was completed in March 2021, though the project was originally opened to the public in October 2020.
Given the significance of the project, it’s not surprising that the dispute was dealt with reasonably quickly. By April 2021, the lien had been partially released, leaving only a remaining balance of $1 million.
3. Pavonia Avenue Tower: $84 million lien
Location: Jersey City, New Jersey
Project address: 618 Pavonia Avenue
General contractor: Katerra Construction
Claimant: Katerra Construction
Katerra’s June 2021 bankruptcy declaration caught many by surprise, but it isn’t surprising that the once-promising company is still dealing with problems from its construction work.
The company filed a lien on Jersey City mixed-use project 618 Pavonia Avenue on October 12, 2021, claiming $84,275,951 for their work on the project which some reports have called one of the largest ongoing construction projects in the area.
According to reports, construction began in earnest on the 27-story tower in September 2021. Katerra was originally set to continue on as a general contractor for the project before it had to reject the contract in the early stages of its June 2021 bankruptcy proceedings.
Given the significance of the overall project’s development, it’s safe to assume that the group will be motivated to resolve the lien. Effy Namdar, COO of Namdar Group, pointed out the importance of the project, saying “We’re proud to bring this important housing development to Journal Square that will help generate economic development and growth for the surrounding neighborhood.”
2. Sierra BioFuels Plant: $95 million lien
Location: Sparks, Nevada
Project address: 3600 Peru Drive
General contractor: Abeinsa Abener Teyma General Partnership
Claimant: Abeinsa Abener Teyma General Partnership
The construction of a new biofuel plant for Fulcrum BioEnergy Inc. led to a major lien filed by the Abeinsa Abener Teyma General Partnership in July 2021. The group’s work as the general contractor for the project led it to claim $95,076,396 in nonpayment.
According to Fulcrum Sierra Biofuels, the Sparks, Nevada project is “the world’s first commercial-scale plant converting household garbage into low-cost, zero-carbon transportation fuels.”
The company noted that construction was completed on July 6, 2021, with Abeinsa Abener Teyma General Partnership’s lien filed very shortly afterward on July 29, 2021.
Dealing with the lien should be a major focus for the short-term future of the plant, as the company noted that it was hopefully going to be online within a short period: “Fulcrum Fuel produced at Sierra will divert hundreds of thousands of tons of waste from a local landfill every year, while also helping our customers achieve their net zero-carbon emissions goals. We couldn’t be more proud to bring the world’s first waste-to-fuels plant online in the coming months.”
1. Community Memorial Hospital Health Systems: $141.6 million lien
Location: Ventura, California
Project address: 1306 Maricopa Highway
General contractor: McGillivray Construction
Claimant: McGillivray Construction
An April 19, 2021, lien filed by McGillivray Construction comes with an absolutely stunning financial claim, with the total coming to $141,640,995.
The lien stems from the company’s work on Ventura, California’s Community Memorial Hospital Systems.
McGillivray notably built the Community Memorial Hospital Cancer Center, with its original work on the construction of the 23,000 square foot complex completed in 2010. However, the company completed additional work for the systems in 2018.
By all public accounts, the company’s work with Community Memorial Hospital has been successful. McGillivray’s website features a positive quote from Gary Wilde, president and CEO of Community Memorial Health Systems: “This remarkable addition to the CMH grounds has remained on time and on budget, excluding any unforeseen delays the Cancer Center is scheduled to open [on time].”
A separate opinion from General Contractors Magazine similarly spoke highly of the job done by McGillivray Construction, saying that the “Ventura Cancer Center is one of the many successful complexes [built by the company]. For this project, McGillivray Construction completed the site demolition, planning and building on time before the expected opening.”
Liens can be filed for any amount – literally
The magnitude of these missed payments is extraordinary, but they don’t paint a full picture of the industry’s persistent payment problem. Most contractors in the country are small businesses, many of whom depend on each payment to keep the lights on. The vast majority of liens filed in the US are not million-dollar claims. In fact, last year more than 1,000 mechanics liens were filed for less than $500.
Lien laws give construction companies the right to file a lien claim on a property whenever they are unpaid for the work or materials they provide. The law does not care whether they are owed $1 or $1 million – they have the right to file a claim.