Giorgio Armani Japan (GAJ) has been sued by developers over its Ginza Tower, which opened in Tokyo last November, drawing much media attention. But recently, it has come to light that Armani has been sued by major builders Mitsubishi Estate Corp and Kajima Corp over unpaid construction costs worth more than 1.3 billion yen in total.

According to the complaint filed by the developers, GAJ hasn’t paid 680 million yen of 1.2735 billion yen to Mitsubishi Estate and 630 million yen to Kajima respectively.

GAJ declined to comment to Shukan Post, but a statement submitted to the court says that no invoices exist and that there are only estimates provided by the developers. GAJ says it cannot pay anything without a finalized invoice.

The bone of contention is that GAJ requested several changes to the tower as construction proceeded, none of which were included in any officially finalized documents. One insider says the trouble was exacerbated by the oil price hike.

Lawyer Hiroshi Akasaka, who specializes in construction industry lawsuits, says, “Similar troubles often occur between small and medium-sized companies because they tend to let their plans proceed without setting limited budget. But it’s quite rare that this sort of trouble happens among major companies like Armani, Mitsubishi Estate and Kajima.” (Translated by Taro Fujimoto)

6 Comments

• 

  OgieDoggie at 02:51 PM JST - 2nd September

  it has come to light that Armani has been sued by major builders Mitsubishi Estate Corp and Kajima Corp over unpaid construction costs worth more than 1.3 billion yen in total-

  That's a chunck of change there...and who is going to be left holding the bag...could it be the Japanese Banks that were dumb enough to loan these constuction companies the money? I hope this Ginza Tower was worth it.

• 

  ultradodgy at 03:27 PM JST - 2nd September

  Something is fishy. Almost every construction contract in Japan is fixed-price, date certain. Change orders are, as you can imagine, highly detailed and technical (including that little matter of the price.)

  If the contractor was truly not paid for work done, the title to the building would never have been transferred from the contractor to the client (or at least the portion representing the unpaid amounts.)

  Oh, and methinks it was the cost of steel, not oil, that led to the price overages (again, this would almost always be eaten by the contractor in a typical deal.)

  Lastly... OgieDoggie, something tells me Mitsubishi Estate and Kajima will be good for the cash.

• 

  blue_monday at 07:21 PM JST - 3rd September

  Wonder what make of suit the lawyers are wearing

• 

  Mark_McCracken at 12:33 AM JST - 4th September

  Scandal? Going a bit overboard here aren't you? This is a disagreement, not a scandal.

• 

  GW at 03:25 PM JST - 4th September

  all these stupid brands who built ugly monstrosities in Ginza will probably all be going under soon, i think their sales are going to heading south for years to come!

• 

  wanderlust at 05:59 PM JST - 4th September

  ultradodgy - I think you'll find that it is Georgio Armani who must be good for the cash. They owe the money.

Register or login to add a comment!