Construction of the World’s Tallest Prefab Stalled in Monetary Mess

Not far from the Barclays Center at 461 Dean Street at Flatbush Avenue, construction of the first of 14 prefab buildings in Pacific Park (formerly Atlantic Yards) has once again come to an unplanned halt. The building will be a 32-story, prefabricated collection of 930 modules resulting in a 322-foot-tall tower known at B2. Designed by SHoP Architects, it will be the tallest modular building in the world, if it is ever actually completed.

Contractor Skanska issued a stop work order, furloughing its workers as of last Wednesday. They say that if their dispute with developer Forest City is not settled, they will lay off their employees on September 23.

The conflict originates in the higher costs of the construction of the modules, which are being manufactured in a factory in the Brooklyn Navy Yard. The contract is worth $117 million for the delivery of the modules. No specific numbers on the amount of the overruns have been given, but according to sources who reported to the Wall Street Journal on the dispute, the figure is in the “tens of millions of dollars.”

Skanska blames the higher costs on problems with the design of the modules, which have “technical issues.” The co-chief operating officer of Skanska USA Building, Richard Kennedy,   explained to the WSJ that, “We’ve invested more into that venture than we ever anticipated or agreed to. No contractor in America would continue working under those circumstances.”

Forest City, the developer, has a completely different take on the work stoppage. A Forest City spokesman says that Skanska is trying to “weasel” out of a situation that they created themselves. In a statement published in Crain’s, a Forest City representative said that,

“This is a dispute over the costs of delays resulting from Skanska’s own failures and missteps as the construction manager for B2 modular. Skanska entered into a construction management agreement based on a fixed price which they guaranteed. Now faced with overruns, they are employing a typical strategy to try to weasel out of that obligation.”