After the tragic collapse of a structurally unsound Miami apartment complex resulted in the death of 97 residents, many Americans have grown worried about the state of the buildings in which they live.
The worries are now being escalated by residents of a New York “billionaire row” skyscraper. Residents are suing the building’s developers alleging that they cut corners at one of the most luxurious apartment buildings in the world — where a penthouse apartment was listed last year for $169 million dollars (double its purchase price of $87.7 million in 2016.)
The condo board representing the residents of 432 Park Avenue is suing the developers (CIM Group and Macklowe Properties) for $250 million dollars plus punitive damages amid allegations over 1,500 structural and design flaws.
“What was promised as one of the finest condominiums in the City was instead delivered riddled with over 1500 identified construction and design defects to the common elements of the Building alone (leaving aside the numerous defects within individual units),” the lawsuit states.
The suit also alleges that the developers did not properly take into account the height (1,396 feet) of the building. This resulted, the Board claims in stuck elevators, flooding and “horrible and obtrusive noise and vibrations.”
The building’s sponsor defended the structure in a statement reported first by Bloomberg in which it described 432 Park as “Manhattan’s premier residence” that has “performed remarkably well. Virtually all new construction has maintenance and close-out items during the building’s initial period of occupancy,” the sponsor said and, the “sponsor has been and remains committed to working collaboratively with the HOA to resolve these matters.”
The tower overlooks Central Park and is, indeed, one of the most expensive locations in the world. Buyers of the condos included celebrities such as Jennifer Lopez and Aaron Rodriguez. (The couple reportedly sold their unit for $17.5 million in 2019.)
Rising Prices Cause Some Developers to Cut Corners
While this building was constructed long before inflation set in, the question of quality is increasingly becoming an issue in new construction. As the cost of materials and services increases, developers are trying to manage production costs. Rather than raising prices outright, some have opted to use fewer materials, or lower-quality materials and construction.
Economists call this phenomenon “shrinkflation,” after the shrinking packages of popular retail consumer goods. In construction, however, shrinkflation is particularly dangerous, as it can lead to tragedy.