A Philadelphia court has awarded approximately $174.6 million in damages to developer Chestle Development in a breach of contract case against Tutor Perini, stemming from construction defects at a dual-branded hotel project in the city.
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The ruling, issued April 10 by the Court of Common Pleas for Philadelphia County, marks a significant development in a yearslong dispute tied to the construction of the 51-story W Hotel and Element Hotel complex in Philadelphia. The project includes 755 rooms and represents a major hospitality development in the city.
According to court documents, the dispute centered on defective concrete work spanning from the third floor to the top of the building. The issues were deemed substantial enough to constitute a breach of contract, ultimately leading to the sizable damages award.
Tutor Perini, based in Los Angeles, had secured a $239 million contract for the project in 2015. The hotel complex officially opened in 2021, but only after significant delays. Chestle Development alleged that construction deficiencies contributed to more than 890 days of delays, prompting the legal action.
The court’s decision underscores the risks contractors face when construction defects lead to schedule overruns and financial losses. Attorneys representing Chestle Development emphasized that the ruling reinforces the principle of accountability in large-scale construction projects.
“This award confirms what Chestlen has maintained from the start: accountability matters, regardless of the size of the contractor,” said Peter Sheridan, chair of the Construction Litigation practice at Glaser Weil. The firm represented the developer alongside co-counsel from Blank Rome and Royer Cooper Cohen Braunfeld.
Tutor Perini did not immediately respond to requests for comment following the judgment.
The case highlights the importance of quality control and contract compliance in high-rise construction, particularly when structural elements such as concrete are involved. Defects in these systems can have cascading effects on project timelines, costs and overall building performance.
In recent years, Tutor Perini has worked to reduce its exposure to legal disputes. During its most recent earnings call in February, company executives said they had reduced the number of ongoing legal cases from roughly 50 to about a dozen.
That effort has played a role in improving the firm’s financial performance. The resolution of outstanding disputes helped the contractor return to profitability in 2025 after years of litigation-related expenses.
“We spent a lot of money over the last several years on litigation expense,” said Gary Smalley, the company’s CEO and president. “Legal expenses are something that, of course, are necessary in business and certainly in this industry. But I think you’ll see less and less legal expenses from us, and that’s only going to drive profit improvement too.”
The Philadelphia ruling adds another high-profile case to the company’s litigation history and may influence how contractors approach risk management and dispute resolution moving forward.
Originally reported by Joe Bousquin, Senior Editor in Construction Dive.
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