Prominent builders collapse owing millions

Two prominent building companies in Victoria and New South Wales have hit the wall, while in Western Australia attempts are underway to resuscitate a construction company that owes more than $10 million.

Another company, Brisbane-based DC Living, went into administration last month but new reports reveal the company owes $4 million, half of which is to staff.

Melbourne-based construction company Apex Homes Australia has collapsed with more than a dozen projects not yet completed and debts of almost $200,000.

Well known builder of high quality granny flats, Cubitt’s Granny Flats and Home Extensions, has also gone into voluntary administration after three decades of building homes.

Cubitt’s, which has offices and display centres in Sydney, Newcastle, Wollongong and Canberra, blamed the skyrocketing costs of building homes, high taxes, lending conditions and supply line issues.

The business is now up for sale, with insolvency firm RSM Australia Partners appointed as administrators. 

RSM released a statement saying it has identified about 200 creditors owed $3.8 million.

A company statement on its website said an emotional meeting was held to advise staff, many with 25 years experience at the company, that 30 years of home building was over due to an array of industry challenges.

“Due to bank lending conditions, supply prices, taxation changes, insurance prices, Covid recovery and lengthy weather events, Cubitt’s company has suffered more than it can shoulder,” the statement read.

“Cubitt’s made the decision in 2021 to honour fixed price contracts and not pass on price rises to their customers, bridging the shortfall and completing projects with significant loans to the company by the owners, Ian Cubitt, Kim Cubitt and Kate Cubitt, using their personal assets.

“Unable to bridge the gap entirely, the directors have today appointed Richard Stone and Brett Lord from RSM Australia Partners as Administrators with the objective of finding a buyer for this truly special and iconic business, building affordable housing that Australians can be proud to live in.”

Victoria’s Apex Property Group management has been elusive, with the website closed down, phone lines cut and customers commenting publicly that they had not heard from the company for a week or more.

The end of the company came when a concrete company lodged a winding up application earlier this year over a $46,200 debt dating back to October 2023.

Nearly 90 construction companies in WA have called in administrators so far this financial year, according to data released Tuesday by ASIC.

Perth-based contractor G N Construction, which administrators said had accrued debts exceeding $10 million, is still trading and hoping to put together a rescue package.

The company’s biggest client, Multiplex, is working on Brookfield’s 19-storey office tower at Elizabeth Quay that will be home to professional services firm EY.

Administrators said in a statement the contractor had the continued support of its biggest client.

“The administrators are working alongside the directors and the company’s existing senior management team to ensure the ongoing trading operations continue on a ‘business as usual’ basis,” their statement said.

The latest casualties of the woes bringing thousands of builders to their knees follow the collapse last week of Gold Coast construction company Skyfield Homes.

The company, with construction sites in Brisbane, Nerang, Helensvale, and Hope Island, left 38 homes unfinished and debts of around $1.5 million.

Skyfield’s building licence was suspended last year for a period of two months after the company failed to meet several payments.

The company’s website and social media pages were all closed down.

DC Living’s newly revealed level of debt emerged with the company having more than $10 million worth of construction work since July and at least 29 active sites on its books, according to the Queensland Building and Construction Commission (QBCC).

Among 75 creditors are trade suppliers, staff, the tax department, landlords, utilities companies, vehicle companies for leases and personal loans from the directors.