Hines faces second lawsuit for flooded SF apartment tower

A flooded apartment tower that displaced hundreds of tenants in San Francisco has prompted a second lawsuit with a new allegation against landlord Hines: unfair business practices.

The Houston-based developer and owner has been sued by a second batch of tenants forced to vacate the 403-unit highrise after two summer floods at 33 Tehama Street in SoMa, the San Francisco Business Times reported.

Last month, 50 residents sued Hines for unspecified damages after a water pipe burst on the 36th floor in June and August, flooding hallways and apartments on multiple floors below.

With little time to grab pets or belongings, tenants were sent scrambling to nearby hotels. The building was red-tagged by city officials and renters haven’t returned home since.

The initial lawsuit alleged chronic mismanagement and deception on the part of Hines. Tenants said building managers knew the building had plumbing problems and failed to fix them, according to the complaint. They sued for negligence, tenants’ rights and violations of health and safety codes.

A second lawsuit filed by another 44 tenants levels similar allegations against Hines, according to the Business Times.

The latest lawsuit alleges the developer “should have known” that the standpipes in the building required inspection and maintenance based on prior water leaks at the four-year-old highrise.

It accuses Hines of negligence, creating a nuisance, violating tenants’ rights as well as health and safety code violations and breach of contracts for effectively evicting tenants from 33 Tehama.

But it differs from the first complaint by adding one more charge: “unfair business practices.”

“We are calling into question the way Hines does business on a more fundamental level, especially after the flood — the way they treated their own tenants,” said Ryan Vlasak, the attorney representing tenants in the second suit.

“There’s one theory of liability for allowing the flood to occur. There’s another theory of liability for the behavior and the actions and inaction of Hines.”

A Hines representative denied all of the allegations in both complaints.

Hines has worked “around the clock to assist the displaced residents with emergency and temporary relocation options,” the spokesperson said in a statement. “We have provided our residents with temporary housing and funds for personal expenses.

“We have also worked tirelessly to repair the building, engaging leading experts to identify and address the building’s mechanical problems.”

The company said it’s still assessing the cost of damage, and that it expects tenants will be able to move back to their apartments in the first half of next year.

The June 3 flood sent 20,000 gallons of water cascading down to lower floors, according to Hines.

City inspections found the second leak in August came from the same faulty sprinkler system, but on a different floor.

Financial aid and hotel accommodations for tenants ceased in August. The displaced tenants were told they could terminate their leases or wait until they could move back in.

Hines, a global real estate powerhouse, teamed up with Atlanta-based Invesco to develop 33 Tehama in 2018. The green glass tower was designed by Miami-based Arquitectonica, with Lendlease Group serving as general contractor.
It was beset with problems from the start. A construction failure at the partially built highrise forced an evacuation from a dozen nearby buildings.

— Dana Bartholomew

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