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Las Vegas' CityCenter Considering More Testing to Prove Harmon Tower Defects
and Need for Demolition Following a New Court Ruling

By Steve Green, Las Vegas SunMcClatchy-Tribune Regional News

July 28, 2012--The CityCenter complex on the Las Vegas Strip is considering doing more destructive inspections of its flawed Harmon Hotel tower after a court ruling Friday.

Ruling in a lawsuit on construction and design defects and unpaid construction invoices for the unfinished and unused $275 million tower, Clark County District Court Judge Elizabeth Gonzalez said CityCenter couldn't use extrapolation techniques to prove its claim the building is riddled with defects and is unsafe.

The judge found that CityCenter couldn't tell a jury that destructive testing at 397 locations in the building proves its contention there are more than 1,400 defective items in the building because the testing so far hasn't been random enough, a spokesman said.

Steve Morris, an attorney for CityCenter, suggested the ruling may be appealed and/or that CityCenter may seek court permission to do more destructive testing.

That testing can involve the jack-hammering of concrete to determine if reinforcing steel that was supposed to be installed was in fact installed and whether it was installed, spaced and tied together properly.

It wasn't immediately clear if Friday's ruling would delay the planned demolition of the Harmon any more than the demolition will likely be delayed by the existing litigation and demolition planning.

Gonzalez last week ruled CityCenter can implode the building, which CityCenter says is a safety hazard that could collapse in an earthquake. Contractors including Perini Building Co. insist it's safe and can be repaired.

The contractors may appeal the demolition order, and CityCenter has to come up with a demolition plan for approval by Clark County, meaning additional destructive testing could be part of that plan -- and the demolition faced delays even before Friday's ruling.

"Nearly every time CityCenter has chipped away concrete to review structural work at the Harmon, we have found defects. CityCenter is confident that ample evidence will be produced at trial to prove that the pervasively defective construction by Perini and (subcontractor) Pacific Coast Steel has rendered the building unusable and has caused financial harm to CityCenter," CityCenter said in a statement Friday. "In the meantime, we have the court's approval to demolish the Harmon and will proceed consistent with the court's rulings."

MGM Resorts International, half owner and manager of the $8.5 billion CityCenter complex, halted construction of the Harmon component of CityCenter in 2010 because of the defects, which have been blamed on both design and construction problems. Litigation then erupted between the parties, with the contractors saying they're still owed up to $240 million for their work on the structure and CityCenter saying it doesn't owe them anything because they failed to build a hotel it could use.

Perini says the 26-story Harmon can be brought up to code for about $21 million. CityCenter says it would cost nearly $200 million to fix and that such fixes would take more than 10 months longer than demolishing it.

CityCenter says the delays associated with the litigation are harming the finances of CityCenter and even if the building was repaired, the company would have to spend another $30 million overcoming the stigma associated with a repaired building.

Perini's contention is that demolition of the Harmon and its 400 hotel rooms is part of an MGM Resorts business strategy to not complete hotel and condominium units that aren't needed because of the recession.

"Tutor Perini remains confident that it will prevail when the issues of safety, reparability and responsibility for the issues facing the Harmon tower are considered," Perini said in a statement.

Perini, a unit of Sylmar, Calif.-based Tutor Perini Corp., has pointed out that in her order approving the demolition, Gonzalez said the jury would be told that CityCenter had made a business decision to demolish the Harmon and that the demolition "is not evidence of any nonconformance with code or plans" and "is not evidence of any constructional defect or any safety issues at the Harmon."


(c)2012 the Las Vegas Sun (Las Vegas, Nev.)

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