Parties Reach Half-Billion-Dollar ‘Global Settlement' in Legal Fight Over Sinking Millennium Tower

A San Francisco judge announced a settlement Wednesday in the long-running legal battle over the troubled Millennium Tower high-rise – a deal that sources say is on the order of a half-billion dollars.

At least some of the money, attorneys say, will come from taxpayers.

“It’s a global settlement,” said attorney David Casselman, who represents residents of 145 units out of the 419-unit luxury high-rise.

He said the deal was the product of a year of mediation between the parties, which included the developer, builders and consultants as well as representatives of neighboring buildings blamed for contributing to the problem.

“Everybody feels they compromised a little more than they want,” he said. “Which is kind of the essence of a good settlement. So in that sense, I think it’s a very good result.”

Under the deal, all but one the 419 homeowners' claims will be resolved. The lone holdout homeowner could take his case to trial next year.

P.J. Johnston, spokesman for the developer, Millennium Partners, welcomed the agreement as a major step forward and “really good news.”

But, he said, it’s too early to talk details.

“I can’t get into the case itself, but we are happy to be at this point in the process,” Johnston said.

Johnston said one benefit of the deal is that it will finance Millennium’s proposed fix, which is estimated to cost $100 million.

The plan involves installing 52 piles that reach down to bedrock to shore up the listing tower along Fremont and Mission streets, where the tower is now leaning 18 inches at the top. The idea is to stop, if not start to reverse, the tilting and sinking. This week, a key hurdle was surmounted when a city engineering panel endorsed the plan.

At least part of the fix will be borne by taxpayers. That’s because homeowners had sued the publicly funded Transbay terminal project next door to the tower, blaming construction there for destabilizing the already sinking building.

Casselman made it clear that Transbay is on the hook in the settlement.

“The law of California, in fact the United States is that when a public entity damages private property, they owe the private property owner just compensation,” he said.

Casselman couldn’t say how much, however, and Transbay officials did not address the issue, saying the deal is not finalized.

“TJPA cannot comment on any additional details of this conditional agreement-in-principle at this time as those details are being addressed through a confidential mediation process,” the executive director of the Transbay Joint Powers Authority said in a statement. “The TJPA will continue to work with the parties and the mediators in an effort to finalize a global settlement. The TJPA has denied and continues to deny allegations that construction of the Transit Center caused any excessive movement or tilt experienced by the Millennium Tower.”

If the deal is finalized soon, work shoring up the building could start early next year, Johnston said. “Then we can move on to restoring the reputation of this great building,” he said.

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