Millions owed: Qld’s biggest construction company collapses

 

Subcontractors were short-changed millions of dollars following the collapse of several major Queensland construction companies.

The state's building sector sailed into uncertainty at the start of the year with building approvals at year-long lows.

The arrival of COVID-19 resulted in display home walk-throughs and auctions being cancelled as nervous investors kept their cash close. While tough economic conditions led to the collapse of at least one dozen building companies - others were liquidated for different reasons.

The Federal Government introduced its $680m HomeBuilder stimulus program in July, providing eligible owner-occupiers including first home buyers with a grant of $25,000 to build a new home or substantially renovate an existing home.

In Queensland 2536 applications have been received to access the program.

Here are some of the state's most costly and publicised collapses of 2020.

 

MJM Projects Pty Ltd - trading as Vystal Construction and Development

Collapsed January 29

Sub-contractors and workers were owed a staggering $4.1 million following the shock collapse of a major Queensland construction business.

At the time of its collapse the company owed 182 secured and unsecured creditors $3.99 million, a financial report authored by liquidator Steven Staatz revealed.

A further eight priority creditors, workers and the Australian Taxation Office, were owed $137,378 - taking the total to $4.1m.

Laidlaw Group Construction Pty Ltd

Collapsed May 28

Two unsecured creditors were owed $57,328 when Laidlaw Group Construction was put under the control of SM Solvency liquidator Brendan Nixon in May.

The southeast Queensland and northern New South Wales carpentry company was hit hard by COVID-19, its director Rylie Laidlaw noted.

James Laidlaw resigned as a director of the company on May 6, just weeks before its liquidation.

Mr Nixon noted the company's bank account had less than $1 at the time of his appointment and said a dividend was "highly unlikely".

The Australian Taxation Office and TW Accounting and Business Solutions were owed $56,928 and $400 respectively.

Thomson Family Builders trading as Lifestyle Renovations QLD

Collapsed June 4

Control of Thomson Family Builders was handed to Revive Financial liquidator Jarvis Archer as debts to 23 creditors reached almost $100,000.

The company, which was registered in June 2019 and undertook small to medium renovation and construction services, fell over owing unsecured creditors $89,128.

Two priority creditors, an employee and the Australian Taxation Office, were owed a further $8123.

A financial report prepared by Mr Archer noted said it "appears the company may have underquoted on the projects it was contracted to complete".

The director, Scott Thomson, said insufficient cash flow and a lack of funding was to blame.

Adtech Building Group Pty Ltd

Collapsed June 5

Southport's Adtech Building Group Pty Ltd was put under external administration on June 5 owing $187,117 to 16 creditors.

The company had $74,647 in assets according to liquidator Michael Caspaney.

The Australian Taxation Office and ANZ Bank were the largest creditors, owed a combined $96,78.

Toowoomba joinery company Project 717 is listed as an unsecured creditor, owed $69,986.

Director Adam Mewett told Mr Caspaney the company failed due to "a lack of ongoing work".

"My investigations to date indicate that a downturn in trade occurred with steadily declining sales occurring over the 12-month period prior to entering liquidation," Mr Caspaney said last month.

RGD Group Pty Ltd

Collapsed June 12

Major Sunshine Coast builder RGD Group left a huge wake of unsecured creditors claiming about $31m in debts following its collapse earlier this year.

RGD Group and RGD Constructions, two Sunshine Coast-based companies directed by Ron Grabbe, were placed into voluntary administration in May before liquidators were formally appointed on June 12.

A report to creditors found between $13.5m and $14.5m had been lost by RGD Constructions due to a range of issues on the Virtuoso project, a premium, riverfront apartment development by Stockwell in Brisbane's West End.

FTI Consulting liquidators also found "comprehensive losses" of about $10m and $9.3m had been recorded by RGD Constructions in the 2019 and 2020 financial years.

The Deputy Commissioner of Taxation claimed debts of more than $138,000 against RGD Constructions and more than $388,000 against RGD Group.

Other notable claims against RGD Group included more than $513,000 owed to Bimcrest Pty Ltd, more than $287,000 owed to Peter Saunders and more than $112,000 to Regency Fabrication.

Mewett Constructions Pty Ltd

Collapsed June 15

The liquidation of Mewett Constructions was the second company collapse for director Adam Mewett within weeks following the downfall of Adtech Building Group.

Control of Mewett Constructions was handed to liquidator of Michael Caspaney with debts totalling $74,010 to five creditors.

Pioneer Credit Solutions is the largest creditor, owed $68,459 and the Australian Taxation Office is $1050 out of pocket.

Total Lifestyle Builders Pty Ltd trading as Lifestyle Kit Homes

Collapsed June 18

Brisbane's premier home extension and renovation business went into liquidation in mid-June with the list of creditors topping $1m.

Total Lifestyle Builders Pty Ltd - trading as Lifestyle Kit Homes appointed Jarvis Archer of Revive Financial as liquidator to wind up its affairs.

According to a report on the company's activities and property provided by Total Lifestyle Builders's sold director Allan Ernest Stroud it owed $1,049,950 to unsecured creditors.

"Of this total, $610,000 is owed to the director who has advised he provided personal funds to the company," Mr Archer said in June.

The balance of $439,950 is owed to unrelated creditors including the ATO, various suppliers, subcontractors and other trade creditors. of the company.

Bulkbuild Pty Ltd

Collapsed June 19

Mansfield-based Bulkbuild Pty Ltd went into voluntary administration in June and later Hall Chadwick's Ginette Muller and Marcus Watters were appointed liquidators.

Bulkbuild collapsed owing about $5.5m to creditors.

The liquidators have filed an application with the Supreme Court for sole director Digen Hur's interest in a two-storey mansion in Carindale - valued at $1m.

At the time Bulkbuild went into voluntary administration in May it was working on the Ferro Property Group's West End apartment project, London Residences.

Hobson Constructions

Liquidated June 22

The retirement of Hobson Constructions director Roderick Hobson prompted him to put the dormant company into liquidation.

The company was liquidated with one creditor owed $712,925.

However the creditor is a related company, Patrick Property Trust.

Liquidator Robert Humphreys said no recovery was expected following the collapse of Hobson Constructions.

MG Constructions QLD

Collapsed July 2

A staggering 52 creditors were left out of pocket when long-time Brisbane building company MG Constructions QLD - which supplied, reinforced and pumped concrete - was put into liquidation in July after 15 years in business.

Nine priority creditors, employees, were owed $165,077 in superannuation and leave.

A further 43 secured and unsecured creditors were chasing $665,121.

However, Robson Cotter liquidator Abdul Chambal noted the company had significant assets including cash in the bank - meaning creditors were likely to receive between 51c and 100c in the dollar.

Beagle Boys Construction

Collapsed: August 31

Townsville's Beagle Boys Construction was put in the hands of liquidator Robert Humphreys as its financial situation worsened.

Four creditors owed $236,455 were listed at the time of its collapse.

Director Aaron Hardy was overwhelmingly the largest creditor, owed $198,259.

The Australian Taxation Office ($23,080), Mackay Concrete Pumping Service ($10,941) and WorkCover Queensland ($4175) were the remaining creditors.

Urban Construct and associated entities

Liquidated September 7

The development firm that once boasted a $3.5bn pipeline of apartment projects in southeast Queensland is winding up a number of its companies.

Urban Construct Qld and associated companies were wound up voluntarily by its shareholders with a liquidator put in charge of the company's affairs.

The company did not owe any money to its creditors.

Urban Construct managing directors Todd Brown and James Rice relocated from Adelaide a decade ago and by 2014 said they had over that time built up a pipeline of developments of 3500 apartments and 1500 town houses worth $3.5bn.

 

 

 

Originally published as Millions owed: Qld's biggest construction company collapses


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