Simon-Macerich mall project in Carson sparks latest legal claim

Contractor Pacific Steel says it is owed $1M in work at the stalled development, marking 2nd lawsuit in recent weeks

TRD LOS ANGELES /
Jun.June 22, 2020 02:17 PM
Carson Mayor Albert Robles and a rendering of the proposed project (Credit: The city of Carson)
Carson Mayor Albert Robles and a rendering of the proposed project (Credit: The city of Carson)

UPDATED, June 22, 6:17 p.m.: A steel contractor is suing the city of Carson, and mall landlords Simon Property Group and Macerich over more than $1 million in unpaid work at a stalled $400 million retail project.

In the lawsuit filed Thursday, Pacific Steel Group claims it is owed $1.25 million of the $7 million in work it performed at Simon and Macerich’s planned 566,000-square-foot outlet mall.

The legal action comes less than two months after Simon and Macerich sued Carson over the project, claiming the city neglected extensive environmental cleanup work it had agreed to perform at the 57-acre site. The mall, to be called Los Angeles Premium Outlets, is being built over an old landfill, which until the 1960s had been Los Angeles County’s largest.

Simon and Macerich agreed to mostly finance the mall construction, but Carson said the city would complete the environmental cleanup and perform some initial infrastructure work.

In their lawsuit against Carson, Simon and Macerich — whose legal entity for the mall project is Cam-Carson LLC — accused Carson officials of “staggeringly deficient project management,” including estimated cleanup costs that ranged from $27 million to $80 million.

Work was halted and now Pacific Steel contends it has few options to recoup the money because the city is involved. “The project is a public works project in that it was contracted by a public entity,” according to its lawsuit, filed in Los Angeles County Superior Court. Pacific Steel has no lien rights on the project, according to the complaint.

Representatives from Simon and Macerich did not return messages.

Simon, the nation’s largest mall operator, is fighting battles on several fronts. The company has sued the Gap for $66 million in unpaid rent at its malls and is girding for a legal throwdown with Taubman Centers. Earlier this month, Simon scuttled its long-planned $3.6 billion merger with Michigan-based mall operator Taubman.

Santa Monica-based Macerich, meanwhile, has been battered by tenants skipping their rent payments, as have other mall operators. In April, Macerich disclosed it collected just 26 percent of total rent.

This article was updated to reflect Carson Mayor Albert Robles’ comments.


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