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Real Estate & Construction News Roundup (7/8/26) – Data Centers Negotiate Flexibility for Speed, Hotel Deal Activities Focus on Luxury, and DC Sues Apartment Owners

July 20, 2026 — Pillsbury's Construction & Real Estate Law Team - Gravel2Gavel Construction & Real Estate Law Blog
In our latest roundup, rail projects gain steam across the U.S., AI optimizes building operations, a modular approach speeds data center construction, and more!

Hyperscalers want their data centers online, and utilities want to provide interconnections, but both are still looking for common operating guidelines. (Herman K. Trabish, Construction Dive)
Contractors are taking advantage of multibillion-dollar train and transit contracts, even as funding challenges create hurdles for project execution. (Matthew Thibault, Construction Dive)
Although hospitality and leisure M&A deal volume was down 2.5% in the first half of 2026 compared to the prior six months, investors are concentrating on the upper end of the market, including luxury hotels, wellness resorts and gaming, or “data-rich,” platforms. (Noor Adatia, Hotel Dive)

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Reprinted courtesy of Pillsbury's Construction & Real Estate Law Team

Project Labor Agreements: A New Bid Protest Forum Split

May 14, 2026 — Dirk D. Haire, David P.J. Timm and Michael J. Brewer - ConsensusDocs
Advertisements often include a disclaimer: “individual results may vary.” Similarly, lawyers are notorious for saying “it depends.” The mandatory Project Labor Agreement (“PLA”) regulations have recently placed into context this adage as it applies to federal contract bid protests, with very different results depending on which forum – the Court of Federal Claims (“COFC”) versus the Government Accountability Office (“GAO”) – different contractors have selected to bring PLA bid protests. Over the last two years, over 30 protesters have successfully achieved removal of mandatory PLAs from large-scale federal construction contracts based on two landmark bid protest decisions issued by the COFC. Similar challenges to PLAs at the GAO, however, have not been successful in removing PLAs, highlighting an emerging trend that the COFC is often a more effective relief forum than GAO for government construction contractors. Reprinted courtesy of Dirk D. Haire, Burr & Forman LLP, David P.J. Timm, Burr & Forman LLP and Michael J. Brewer, Burr & Forman LLP Mr. Haire may be contacted at dhaire@burr.com Mr. Timm may be contacted at dtimm@burr.com Mr. Brewer may be contacted at mbrewer@burr.com Read the full story...

Modular Construction’s Big Boom: New Risks Outpacing Standard Contracts in Industrial Projects

March 24, 2026 — Chad Theriot & Jack Mayo - Construction Executive
Modular construction is revolutionizing the construction industry, tackling labor shortages, sustainability goals and supply-chain challenges, with the global market for modular and prefabricated construction projected to reach over $200 billion by 2030. While residential builders have embraced modular’s speed and affordability, the greatest risks—and opportunities—are emerging in the industrial sector, where project scale and complexity demand new legal strategies. In 2023, Chad Theriot explored industrial and infrastructure applications of modular construction, addressing risks like offsite fabrication and integration complexities in his article, “The Rise of Modular Construction—Impacts for Consideration.” Since that time, modular construction has continued to experience significant advancements and has been increasingly adopted by contractors across a broad spectrum of industrial and commercial projects. As modular construction continues to reshape the industrial landscape, contractors and owners alike must be mindful of the legal implications associated with its use, specifically as it relates to liability and risk allocation, regulatory compliance, quality control and upstream factors such as transportation and intellectual property concerns. Reprinted courtesy of Chad Theriot and Jack Mayo, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved. Read the full story...

Risks of Using an AI Chatbot for Legal Advice: Lessons from United States v. Heppner

April 08, 2026 — Payne & Fears LLP
Imagine that you are an executive (who is not a lawyer) and are concerned about what your company plans to do is legal. You could call your lawyer who might bill you for the call. Or, you can ask your AI chatbot, such as Claude or ChatGPT, about the legal risk. The chatbot will likely compliment you on the incisive question, provide you with highly confident answer (that may or may not be right) and will not bill you on an hourly basis. That is essentially what financial services executive Bradley Heppner did. It did not end well. A federal court recently ruled that Heppner’s chats with the AI tool Claude were not protected by attorney-client privilege or the work-product doctrine. That means that the other side (in this case, the federal government) could get access to his chatbot prompts, uploads and responses, and learn a great deal about, for example, whether Heppner knew what he was doing was illegal. Read the full story...
Reprinted courtesy of Payne & Fears LLP

UPDATED: No Easy Fix for Potomac River Sewage Spill, Now Estimated at $20M

April 08, 2026 — Jim Parsons & Debra K. Rubin - Engineering News-Record
One month after a collapsed pipeline north of Washington, D.C., spilled about 240 million gallons of raw sewage into the Potomac River and possibly between 300 and 400 million—which could be the largest wastewater spill in U.S. history—efforts are progressing to clear the damaged section and begin repairs despite weather and other impacts. Reprinted courtesy of Jim Parsons, Engineering News-Record and Debra K. Rubin, Engineering News-Record Ms. Rubin may be contacted at rubind@enr.com Read the full story...

Leaders in Dispute Resolution Need to Make Unbiased Decisions for Mediation to Succeed

March 31, 2026 — Rick G. Erickson - Snell & Wilmer
As a mediator helping to settle construction disputes and as an arbitrator deciding outcomes of these disputes, I found certain lessons to be especially helpful after graduating last summer from the Executive Education program at Harvard Kennedy School (HKS). The exceptional HKS curriculum included courses focused on negotiation strategies for multiparty disputes, decisive leadership during crisis, and human behavior affecting dispute resolution. In particular, our HKS class debated the impact of cognitive bias in dispute resolution, and we studied a central theme that decision-making is universally scientific. That is, parties making decisions in dispute resolution exhibit and rely upon empirical factors that good mediators and decision makers should appreciate and understand. Bias, for example, can cause key players to discount persuasive witnesses, admissible evidence, and reliable expert opinions that influence the outcome of a construction dispute. Biased decision makers may also choose to withhold key information from the mediator, as though doing so will help rather than hurt what is supposed to be an objective and diplomatic process. Read the full story...
Reprinted courtesy of Rick G. Erickson, Snell & Wilmer
Mr. Erickson may be contacted at rerickson@swlaw.com

Court Rules Cook County Misspent $243M in Transportation Funds

March 10, 2026 — Annemarie Mannion - Engineering News-Record
A Cook County Illinois Circuit Court judge has ruled that the county violated the state constitution by using $243 million in transportation tax revenue during fiscal 2023 for non-transportation purposes, handing a legal win to a statewide coalition of construction trade groups. Read the full story...
Reprinted courtesy of Annemarie Mannion, Engineering News-Record
Ms. Mannion may be contacted at manniona@enr.com

Arizona Supreme Court Clarifies Parties’ Post-Default Conduct Cannot Validate Void Default Orders

August 24, 2026 — Joseph Kanefield, Ryan P. Hogan & Lilly M. Geiler - Snell & Wilmer
After filing a lawsuit, the first step is always serving process on the opposing party. While that preliminary step sounds basic enough, in McMahan v. Grasshopper, the Arizona Supreme Court recently provided a helpful refresher on the nuances of the service requirement and its importance in litigation for plaintiffs and defendants alike.1 Background McMahan arose from a hit-and-run where a tractor-trailer collided with safety barricades and injured a construction worker. The construction worker sued the tractor-trailer company, and he attempted to serve the company by leaving a copy of the complaint with the assistant to the company’s statutory agent who forwarded the complaint to the company. The assistant, however, was not authorized to accept service on the company’s behalf. Before the company appeared in the action, the construction worker successfully obtained an entry of default. Reprinted courtesy of Joseph Kanefield, Snell & Wilmer, Ryan P. Hogan, Snell & Wilmer and Lilly M. Geiler, Snell & Wilmer Mr. Kanefield may be contacted at jkanefield@swlaw.com Mr. Hogan may be contacted at rhogan@swlaw.com Ms. Geiler may be contacted at lgeiler@swlaw.com Read the full story...

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