Is one of Tampa Bay’s premier condo towers sinking?
Tampa Bay Times
Susan Taylor Martin

It has been called Tampa's "most prestigious building'' and "the most refined expression of living" in all of Tampa Bay. The views are "stunning,'' the amenities "fit for a king and queen.''

But is the Plaza Harbour Island sinking?

The Plaza condo association is embroiled in a lawsuit alleging that the 20-story, 144-unit tower built in 2007 is plagued with problems. Among them: exterior cracking that is the result of "significant subsidence concerns and structural design deficiencies.''

Geotechnical investigations found "very loose and very soft bay bottom soils'' under the first-floor commercial units, according to the suit filed in Hillsborough County Circuit Court. "These soils are completely unsuitable to support the foundation and, as a result, the soils have settled with resulting movement and significant cracking of the walls, stucco and structure.''

Now, in a tower where some units once sold for more than $2 million, damages caused by the alleged defects have included "loss of use, relocation expenses, diminution in value, increased insurance premiums (and) damage to other property,'' the suit states.

The Plaza's problems emerge as the condo association of Tampa Bay's tallest condo tower, the 36-story, 244-unit Signature Place in downtown St. Petersburg, purportedly has reached a settlement in a lawsuit alleging major construction defects there. Both the Plaza and Signature Place were built in the mid 2000s just as the housing boom was going bust.

Located across a channel from downtown Tampa, the island from which Plaza Harbour Island takes its name originally was owned by the Seaboard railroad and contained a phosphate terminal. Sold to a developer in 1979, the island has since been transformed into a largely residential community where the Plaza at 450 Knights Run Ave. has reigned as the premier condo tower.

Records show that concerns about soil subsidence go back at least two years. In November 2014, a Lakeland company was hired to do "foundation stabilization'' on Unit 707 in the townhouse portion of the Plaza.

Just as that work was finished the following spring, a Tampa law firm representing the condo association sent a letter to the contractors and others putting them on notice of "certain design and construction defects.''

In addition to the foundation and cracking issues, the letter said, there were problems with the installation of aluminum railings and an inadequate drainage system that caused water to damage planter beds and part of the building.

The defects remained undiscovered for some time after the building was completed — either because they were "latent'' or not easily recognized by people "who lack special knowledge or training,'' according to the lawsuit subsequently filed by the association.

Gail Bernucca, a Realtor and the association's president, said she could not comment because of the suit. DPR Construction and Hardin Construction, which share a Tampa office address, did not return calls.

Since the problems were found, Plaza owners have been required to "disclose the existence of these conditions to any potential purchaser, thereby limiting the marketability of his/her unit and reduce the fair market value of the unit,'' the lawsuit says.

Multiple Listing records show that sales in the Plaza have slowed, though it is difficult to determine how much prices have been affected.

Between January and November of last year, 17 units sold, including several three-bedroom, three-bath units that went for more than $1 million.

So far this year, seven units have sold. The top price paid was $885,000 — down $74,000 from the asking price — for a two-bedroom, two-bath unit in September.

Another striking difference: More than half of the buyers last year got mortgage loans. This year, all sales have been in cash.

"Therein lies the issue — getting financing when there's a pending lawsuit,'' said Jeremiah Bicknese, an agent with Smith & Associates. "There are a few banks that just don't want to flex on that.''

Bicknese said he has told Plaza sellers that he represents to "over-disclose'' issues with the building in order to avoid future problems with buyers.

"There's definitely an impact'' he said of the defects and litigation, ''but fortunately with my clients (the buyers) were able to pay cash.''

Seven Plaza units currently are for sale, including the penthouse with an asking price of nearly $2.4 million. It has been on the market for well over a year.

All houses and other buildings eventually settle into their foundations, construction experts say, and most pose little real danger to occupants. But San Francisco's 58-story Millennium Tower, built about the same time as the Plaza, has sunk 16 inches and tilted at least 2 inches, prompting a class- action lawsuit and fears it could topple in an earthquake

This week, there were no signs from the street of any repairs that might be under way at the Plaza, unlike at Signature Place in St. Petersburg. There, scaffolding still covers part of the building two years after the condo association sued over multiple defects, including improperly installed stucco that could fly off in high winds.

Board members could not be reached for comment, but one Signature Place owner, Scott Brandi, said he had been told the suit had been settled. He hopes that he and other owners will get back at least some of the $8 million in assessments they had to pay for repairs.

It could not be determined whether Plaza owners will also face special assessments. Bicknese, who continues to show listings there, said regular association fees are comparable to those in other Tampa condo towers and that the Plaza remains a sought-after residence.

"It's such a lovely building that once people get the scope of it, even as buyers they are not as nervous,'' he said. "The amenities are amazing — there's valet service and 24-hour concierge service — and it's basically like living in a five-star hotel, like living in a Ritz-Carlton.''

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