One of Queensland’s largest home builders is in liquidation, leaving the future uncertain for more than 200 new homes and 16 employees.
One of Queensland’s largest home builders has gone out of business, leaving the future uncertain for more than 200 new homes in the southeastern state.
Sunshine Coast construction firm Pivotal Homes, once a sponsor of the Gold Coast Titans, went into liquidation late Thursday.
Managing director Michael Irwin said rising labor and construction costs had strangled the company.
“In my 30 years of experience, I have never seen a range of circumstances like this and of course we are not alone in these unfortunate circumstances that the industry is facing,” he told the courier post†
“We are heartbroken for our 16 Pivotal Homes employees and assuring that all creditors, contractors and subcontractors have been paid in full.
“All buyers are in a net profit position, meaning the work they paid for has been completed. They even had more work done on their house than they paid for.”
Speaking on behalf of Pivotal Homes, Derek Cronin of Cronin Miller Litigation said liquidation was the only option left for the company after it got into trouble.
“The decision to liquidate Pivotal Homes is based on forward-looking statements dictated by increasingly challenging market conditions, including the exponential rise in material costs,” he said.
“It’s an unfortunate set of circumstances affecting the industry across Australia.”
The construction industry has been hit hard by collapse this year.
Smaller operators like Hotondo Homes Hobart and Perth firms Home Innovation Builders and New Sensation Homes, as well as Sydney-based company Next have also collapsed, leaving homeowners out of money and with unfinished homes.
An industry insider told news.com.au earlier this year that: half of Australia’s construction companies are on the brink of collapse while acting insolvent, and it could hit the homes of thousands of people in the coming months.
Operators in other industries have also fallen.
Send, a company that promised to deliver groceries within 15 minutes, collapsed earlier this month risk the jobs of 300 employees in Sydney and Melbourne.
Australian investment company REMI Capital was also placed in voluntary administration on Wednesday.
Mark Prestige, who was a managing partner at REMI Capital for nearly four years, acknowledged that there had been a “lack of communication” from the company in recent weeks.
“Remi had been advised in recent weeks by an outside legal counsel not to communicate until the modeling that made this difficult decision possible was completed,” he wrote in an email addressed to investors, shareholders and ex-employees.
“REMI apologizes for any lack of communication over the past few weeks. We ask that you rely on reports to creditors and not on speculation you may hear.”
The property portfolio spanned a range of areas in Melbourne, including projects in the suburbs of Tarneit, Rockbank, Sunshine, Pakenham, Laverton and Sunbury.
Chris Baskerville of specialty insolvency and business recovery firm Jirsch Sutherland has been appointed as administrator.
He said it was too early to tell what had happened, as his company is currently conducting an urgent investigation to identify where the $70 million has gone.
“We are conducting an urgent financial review and are working closely with the directors to try to find a solution and provide the best outcome for investors and creditors,” he said.
“One of these solutions is likely to be a Deed of Company Arrangement (DoCA) proposed by the directors.”
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