California high-rise, mixed-use projects face rising costs, legal risks, Published in the Daily Journal Los Angeles

In an article published on March 19 in the Daily Journal Los Angeles, Segal McCambridge Shareholder Daniel Cribbs explains why California developers can no longer rely on historical pricing assumptions or standard contract templates as construction volatility persists through 2026. He outlines how cost escalation, supply chain disruption, labor constraints, and project-specific regulatory exposure are reshaping feasibility analysis and the way risk must be allocated at the outset.  

"With construction costs expected to remain elevated through 2026, the traditional development playbook, which is built on historical cost data and standard contract templates, no longer provides adequate protection. For high rise and mixed use developments, these pressures are particularly acute, creating a complex landscape where financial viability and legal risk have become inseparably intertwined."  

Cribbs notes that volatility is not limited to inflation and can be driven by supply chain disruptions, geopolitical tensions, timing-based material swings, and labor availability that make forecasting unreliable. Material delays can cascade into months of construction delays for ultra-luxury apartments, and the problem extends to institutional projects such as University housing projects, where timelines are strict, and success impacts admittance rates.  

"When costs rise and timelines slip, contract language becomes a critical battleground,” Cribbs shared. “In high value projects, the difference between well drafted and inadequate contracts can amount to tens of millions of dollars in risk exposure."  

Read the article in full, click here (subscriber-based).