Hotel Contractor Says Shutdown Still Possible

QBurke HotelBURKE - PeakCM President Jerry Davis says the State approved some of the money he was owed for the Q Burke hotel project on Friday, but the operation could still be shut down this weekend because of ongoing issues with equipment expenses.

 According to Davis, the Department of Financial Regulation does not want to pay PeakCM for equipment costs because it claims those expenses are not included in the project contract. Davis argues that the contract covers all furniture, fixtures, and equipment (FF&E). He says separating equipment from that section "doesn't make any sense."

Workers arrived at the job site and it was business as usual on Saturday morning. In an effort to prevent a shutdown before Friday's 4 p.m. deadline, the DFR approved just over $3 million owed to PeakCM. Davis is still waiting on $900,000 in equipment costs, $400,000 of which is considered late.  

The State contends that equipment is not considered an authorized cost for the project and doesn't fall within the parameters of the agreement. As a result, it needs to be separated from other invoice line items.

Davis says the project's third party reviewer - White + Burke - had no issues with the FF&E line items. In his opinion, the State is being "unbelievably unreasonable."

Davis and Q Burke developer Bill Stenger have been in regular communication this week. Despite the payment problems, Stenger is strongly pushing for the job to continue, according to Davis.

Davis says he will keep the job site open as long as he receives confirmation that the State is willing to meet next week to discuss the equipment expenses. If he doesn't get a phone call by late Saturday afternoon, he says he will have no choice but to shut down hotel construction.