Editorial
 
 


In recent years, if you were involved in the design, specifying or any part of the construction phase 
of the building industry, you could get into serious legal trouble just standing next to a multi-family 
dwelling.  As most of you are aware, attorneys have been mining this rich gold vein of construction 
defect lawsuits for years.
	
As mentioned in this column previously, particularly fertile ground for attorneys is condominium and 
residential development homeowners associations.  When representing so many property owners, 
attorneys can afford to hire experts that will dig until they find something.  It can be anything small, but if not to code or to specification, it can be blown up to sound like a major disaster about to happen.  As anyone knows, the construction industry is not rocket science.  On any project, compromises are made in the design and in the field.  In the hands of an expert witness, these compromises can be made to sound life threatening.
	
This tactic is so common; some insurance companies have taken the position that if you work on residential homes involving homeowners associations, they don’t want your business.  Other insurance companies have simply raised their rate to cover their losses.  Besides driving good architects, developers, and contractors away from this segment of the industry, it’s also driving up the price of homes.
	
Some experts in the industry were predicting the eventual demise of multi-family dwellings based on the increased unwillingness of those in the construction industry to get involved with these projects.  If insurance companies won’t insure those involved in the construction, or will do so only at exorbitant rates, eventually the multi-family segment of the market will die, they reasoned.
	
Well, apparently, they were wrong.  The multi-family construction market, is on the rise (see page 36 in this issue).  The high demand for multi-family homes is coming from baby boomers who have recently become empty nesters, the recently divorced or widowed, and the growing population of singles.  In fact, due to the baby boom generation getting older, there are more one- and two-person households than ever before.  The low-end demand is coming from young couples and young families just starting out in life.  The only place you don’t see the demand for multi-family homes is in the middle and upper-middle income group.
	
So where does this leave architects, designers, and contractors who have been burned in the past and swore they would never touch a multi-family project again?  That remains to be seen.  A lot depends on the insurance companies.  If the insurance companies refuse to cover work involving multi-family projects, then a majority of the construction community will have no choice but to steer clear of them, no matter what the demand.

Marcus Dodson
editor & publisher
Hurdles for Multi-Family Homes
Despite Some Problems, Multi-Family 
Home Demand is on the Rise