Mediation of potentially costly disputes over Denver International Airport’s terminal renovation project has effectively stalled out, as airport officials and the contracting team trade increasingly barbed attacks over safety risks and motivations.

That back-and-forth posturing, in a series of recent letters obtained by The Denver Post, bodes poorly for DIA’s relationship with Great Hall Partners. And it’s happening just as several long-running disputes involving huge potential cost overruns and delays on the $650 million renovation are set to come to a head soon.

The parties could seek outside help in resolving their issues, head to court or, in the worst-case scenario, terminate the contract — leaving up in the air the future of renovation work that has been inconveniencing passengers for months.

On DIA’s side, the recent letters about safety issues, alleged contract breaches and a litany of other accusations portray the consortium led by Madrid-based Ferrovial Airports as utterly dismissive of its concerns. DIA repeatedly has warned that workers and travelers are at “at serious risk of harm” from dangerous work site conditions in the busy terminal building.

But to hear Great Hall tell it, the airport is the party that’s vamping in dramatic fashion, by engaging in “a meritless, time consuming, and inappropriate letter campaign” over the last two weeks.

The contractors dispute many of DIA’s safety claims and say the letters are meant to distract from the project’s costly disputes, which center on about 20 unresolved airport change directives and a weak concrete issue that stalled a large portion of the project for several months. Great Hall has contended that DIA’s changes in design, materials and other elements go beyond what’s standard for a large project.

“Surely the Owner (DIA) does not expect all of its unilateral changes to be implemented without time and cost impacts,” Ignacio Pérez Jainaga of Ferrovial-Agroman US, who serves as CEO of Great Hall Builders, wrote in a July 30 letter. He added near the end: “For the good of the project, GHB needs Owner to become engaged and more responsive to actual, documented issues.”

DIA officials have until late August to respond to formal compensation claims filed July 26 by Great Hall Partners. The contractors previously had estimated upward of $300 million in added costs and potential delays of three years or longer, pushing completion from November 2021 to as late as 2025.

Records still withheld from public

As the mediation session that began in June apparently produced little progress, Great Hall faced a deadline to finalize its claims, which specify exactly how much more time and money it’s seeking. But DIA is witholding those new formal claims from public view at the behest of Great Hall, which cites business confidentiality exceptions in Colorado’s open-records law.

DIA also declined requests to make earlier versions of some of those claims public.

A DIA spokesperson confirmed this week that the mediation, which quickly ran into scheduling and other logistical issues, has fizzled.

“There are no mediation sessions scheduled,” said Stacey Stegman, DIA’s senior vice president of communications. “But we are trying to resolve this to get the project back on track.”

As work continues in the terminal, Great Hall Partners has sounded a similar note of optimism that the project can regain its footing. But it’s already months behind in meeting the first several contract milestones.

Centennial-based Saunders Construction is another partner, along with private equity investors, in Ferrovial’s $1.8 billion, 34-year public-private partnership agreement with DIA. The extensive contract covers the terminal renovation, which includes relocation of security screening to the upper level and consolidation of airline check-in counters, as well as three decades of oversight of expanded food and retail outlets in the terminal.

The contract gives DIA approval power over cost additions and schedule extensions, and so far it has budged little. It could simply ignore Great Hall’s compensation claims.

But that power isn’t absolute. Ultimately, the contractors could try to argue that the airport didn’t act in good faith, or the two sides could activate a contractual dispute resolution process that would submit issues to an outside panel, jointly selected by DIA and Great Hall, for binding decisions.

Questions about Ferrovial’s roles

Saunders, which has DIA project experience, is in a back-seat position on the project’s construction team to Ferrovial-Agroman, a corporate cousin to Ferrovial Airports that specializes in construction and engineering.

Michael Sheehan, DIA’s senior vice president of special projects, wrote in an Aug. 1 letter that the closeness of the two Ferrovial entities was “troubling” and suggested it was why the Spanish company’s airport unit was failing, in DIA’s view, to hold the construction team’s feet to the fire.

Among the many safety concerns cited by DIA in recent weeks was that workers cutting through beams were sending sparks flying above uncovered escalators used by the public.

But Great Hall Partners and its construction team have responded in their own correspondence to DIA that it’s exaggerating such risks. The contracting team also took to task a surprise July 23 safety audit in which an outside auditor hired by DIA found at least 29 violations or work site issues.

Great Hall contends several of those issues were mischaracterized or inaccurately flagged, though a handful resulted in changes on the work site.