What will happen to high-profile construction in Salt Lake City as contractor Makers Line goes silent?

In February 2022, Mayor Erin Mendenhall touted plans by two biotech firms to open labs on the west side of Salt Lake City, at the renovated and celebrated INDUSTRY SLC building.

Recursion President Tina Larson was “thrilled” to be expanding into the Granary District building, she said in a news release issued by the city. Denali Therapeutics CEO Ryan Watts said he was “excited” to open a “state-of-the-art biologics clinical manufacturing facility” there.

Since then, neither company has moved in — with both blaming construction delays. Denali Therapeutics terminated its lease earlier this year, while Recursion is locked in litigation with the building’s owner, Industry Office SLC.

The absent labs are two of several projects across the city tied to the work and uncertain fate of general contractor Makers Line, which has deleted or set to private its web page and social media accounts in recent days as employees announced their goodbyes on LinkedIn and described the company as closing. Subcontractors have filed liens and lawsuits — with a flurry of at least five more this week — claiming they haven’t been paid by Makers Line or concrete company Titus.

Makers Line and Titus are two of an “integrated suite of companies” under developer Q Factor, owned by the husband-and-wife team of Jason and Ellen Winkler. The Winklers made a splash in Salt Lake City as they began reclaiming the cavernous foundry building that became INDUSTRY SLC, after developing similar projects in Denver’s River North Art District, or RiNo, a transitional area now turned fashionable.

But as Makers Line has gone silent, Jason Winkler has not responded to requests for comment from The Salt Lake Tribune. Reached last week by Building Salt Lake — which reported first on the company’s layoffs and possible shutdown — he said in a text only that Makers Line did “not quite” close down entirely.

Here are some of Makers Line’s projects in Salt Lake City and what’s known about their status.

Chicago Street Townhomes

Q Factor is the owner of the Chicago Street Townhomes project, a planned 30-unit subdivision off South Temple that was approved by the city in 2021 and, as of two weeks ago, was being developed according to schedule.

But designer Jarod Hall hasn’t heard from Q Factor in a week, he told The Tribune. Hall’s firm, di’velept design, designed the units and submitted applications to the city on Q Factor’s behalf. Hall said everything seemed “fine” in a weekly check-in meeting with Q Factor two weeks ago — the companies even discussed future projects they might work on together. But since news of Makers Line’s potential closing, Hall hasn’t been able to reach anyone.

“It’s totally out of left field,” Hall said.

Hall said his team has been paid for their portion of the work so far. He doesn’t know what will happen to the town house project, which, for now, is in limbo. But he said he is “nervous” about what Makers Line’s departure could mean for the city.

“The problem is, we’re going to have about 20 Sugar House holes throughout the valley,” Hall said, referring to a plot of land in Sugar House that sat demolished but undeveloped for years.

Atre Sugar House

Two residential towers are planned on Ashton Avenue in Sugar House, with an eight-story building adjacent to Fairmont Park and a larger 10-story complex across the street, where a 24 Hour Fitness gym once stood.

The complex at 1121 E. Ashton Ave. plans to offer a mix of 228 studios and larger units with one, two or three bedrooms, available at market rates.

The smaller building at 1132 E. Ashton Ave. will have 113 microunits, studios to two-bedrooms, which “will allow people of lower incomes to be able to afford something in the Sugar House Business District,” the Sugar House Community Council has noted.

Kova, an interior design and supply firm in Austin, Texas, is working for Makers Line on the project, according to its website. On Tuesday afternoon, two Makers Line trucks were parked at the sites and a banner declared them a Makers Line and Alta Terra project.

But no work was underway. Alta Terra, a real estate investor and developer based in Park City, has not responded to multiple requests for comment from The Tribune.

If construction is delayed in Sugar House or elsewhere in the city, there is no limit on how long a pause could last, said Salt Lake City Council Chair Darin Mano.

“I don’t know of any city rule or ordinance specifically related to this,” he said. “In practice, we tend to see projects in this state sit in perpetuity.”

A site where construction has halted “still needs to be secured and safe,” Mano added. “When construction begins again it would need to be re-permitted and inspected and anything that has worn out due to weather exposure would need to be replaced.”

The Granary District

The INDUSTRY SLC building, at 650 S. 500 West, has become an anchor in the burgeoning Granary District and is owned by Industry Office SLC, according to property records.

The Winklers are minority owners of Industry Office SLC, according to Recursion’s lawsuit, with Catalyst Opportunity Fund as the company’s majority owner.

There have been more than 20 liens filed against the property by various subcontractors, according to city records, including one filed Oct. 31 by White Cap, a building materials supplier. Many have been later resolved and released, but roughly 10 are still pending.

Across 500 West from the INDUSTRY SLC building, a seven-level parking garage is in mid-construction.

Mendenhall was back in the Granary District for the groundbreaking of the garage in May 2022, KSL reported. The city handled some pass-through funding for the garage, said Andrew Wittenberg, a spokesperson for the mayor.

In a statement issued Thursday, the mayor’s office said, “we never want to see a company struggle or fail. The city is aware of some projects which are utilizing new general contractors to stay on schedule. Salt Lake City Building Services staff members are always available to assist with technical questions to ensure projects with new leadership can still move forward without delay.”

County records show some of the land where the garage is being built is owned by Industry Office SLC, but the bulk of the area is owned by AAM Investments Ltd., which the Utah Department of Commerce lists as a limited partnership based in Salt Lake City.

A year ago, banners on the fence around the site advertised Makers Line, Q Factor and their related companies, according to Google Street View. This week, those banners were gone.

North of the area, Q Factor has also been a partner in projects in the developing Post District.

Denali Therapeutics

Denali Therapeutics, a biotech and pharmaceutical company based in San Francisco, says it has moved on from the Granary District. It had signed a lease for space at INDUSTRY SLC in August 2021, the company said in Securities and Exchange Commission filings, but there had been construction delays.

In March of this year, Denali Therapeutics said, it terminated that lease. In April, it signed a new lease for a lab, office and warehouse space, it said in filings, elsewhere in Salt Lake City.

The company did not respond to requests for comment. The website Intelligence360 has reported that the new site is on Amelia Earhart Drive, near the Salt Lake City International Airport.

Denali Therapeutics does still have an incentive contract with the Governor’s Office of Economic Opportunity, the office confirmed, for up to $1.3 million in tax rebates.

Recursion

Recursion hired Industry Office SLC to construct a shell of a manufacturing facility — which Industry Office would own — and when it was done, Recursion would become a tenant and build out the interior, according to court documents.

But after construction delays, each company began accusing the other of breaching their contract, according to letters filed in 3rd District Court in Salt Lake City. Industry Office sued Recursion in June and Recursion filed its own counterclaims in September; all are still pending.

Industry Office SLC has accused Recursion of trying to breach the lease and avoid liability; it wants Recursion to pay fines for terminating the lease early. But Recursion argues Industry Office failed to execute essential components — most crucially, a three-hour firewall that would separate Recursion’s lab from its planned neighbor, Denali Therapeutics.

Such a wall “effectively separates a structure into separate buildings,” providing three hours of protection in case of an emergency, Recursion explained in court documents, a safety feature required by its research and manufacturing.

Recursion also accuses Jason Winkler in court documents of misrepresenting the building’s progress, lying about having relevant permits from the city, and lying about the delivery of steel that — at that point — hadn’t even been ordered.

In a pivotal meeting in January, Recursion said in court documents, its executives met with Catalyst co-founder Jeremy Keele and other company leaders without the Winklers, described as Catalyst’s general partner.

The Catalyst representatives said their relationship with their general partner had become ‘toxic’ and resembled ‘Armageddon,’” Recursion attorneys wrote, “and they admitted that Industry Office had terminated the General Partner from the project for ‘gross negligence’ and ‘willful misconduct’” related to repeated construction delays.

Describing the meeting from the other side, attorneys for Industry Office wrote that “attendees for Recursion emphasized that their issues were with Winkler and his entities.”

Keele, Catalyst’s co-founder, told the Recursion leaders, “There must be a way to resolve your issues and get this back on track,” the attorneys wrote, “I feel like we’re on the 90-yard line and it would be a waste to pick up the ball and go home.”

Charles Jabara of Recursion, the filing said, responded, “I wish we were on the 90-yard line, we feel like we’re not even in the game.”

Industry Office SLC, its attorneys, Catalyst and Maker’s Line all declined to comment or did not respond to requests for comment. In a statement to The Tribune, Recursion declined to comment on the dispute, citing the litigation. The company said it “remains committed and excited to continue its growth here in the Beehive State and is actively pursuing alternative options for further expansion.”

Ogden

Ogden officials halted work in March on a 55-unit apartment building that Makers Line’s companies were involved in constructing — after the city found some of the lumber didn’t meet the fire code, the Standard-Examiner reported.

The five-story Union Walk project at 144 25th St. has been sitting idle since, according to the Standard-Examiner. The city most recently issued a notice on Oct. 12, giving the developer, Summa Terra Ventures, until Dec. 11 to resolve the problem.

Summa Terra’s CEO, Mike Watson, said in a statement to KSL that “Makers Line unilaterally made the decision to substitute fire-treated lumber — as originally prescribed in the contract, the approved building plans and the prevailing national building code — with untreated lumber.”

Two companies also claim, according to court documents, that Makers Line owes them money for work done on the Union Walk project. Bingham Plumbing and Mechanical claims Makers Line owes more than $106,000, plus interest, for plumbing and mechanical work and equipment, while Bear River Heating and Air Conditioning is seeking more than $64,000 in compensation — claiming Makers Line has failed to pay them for materials, equipment and labor for the same project.

Q Factor’s website also touts another Ogden project, the restoration of the Ogden Stockyard Exchange building. The plans call for converting the 1931 Art Deco building’s 14,400 square feet into office space, and adding a 25,000-square-foot building onto it. The Ogden City Council approved the project in November 2022, the Standard-Examiner reported — though Mike McBride, spokesman for Mayor Mike Caldwell, told the newspaper this week that if Makers Line was shut down, “that whole agreement would be null and void.”

Several other suits filed by subcontractors also are pending. LG Concrete, for example, claims Makers Line owes it $104,194, plus interest, for labor, materials and equipment. LG Concrete and other companies also have filed liens on some of the properties where they have conducted work and not been paid, which attorney Justin Scott could expedite payment or force foreclosure.

“I’m one in a long line of attorneys representing contractors that have performed work and have not been paid,” said Justin Scott, the attorney representing LG Concrete. “It’s a difficult situation. [Subcontractors] outlined a lot of resources and money and haven’t been paid.”

Tribune reporter Blake Apgar and Tribune culture & business editor Sean P. Means contributed to this report.

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