An Australian construction company has collapsed, leaving subcontractors in the lurch.
A notice from the Australian Securities and Investments Commission (ASIC) said the company Multi-Res Builders, led by Colin Barratt, 62, had entered into liquidation on Sunday, with David Joseph Levi appointed as liquidator.
According to their website and social media profiles – which have now been deactivated – the Tasmanian family-run construction company specializes in ‘purpose-designed homes and multi-residential developments’.
It is reported that at a general meeting of members of May 14, 2023 it has been decided to dissolve the company…’, the message reads.
The company’s website previously stated that projects were in the works, including nine two-bedroom units on Carnegie St, Claremont, 12 three-bedroom townhouses on Boyer Rd, Bridgewater, and a series of units on Hackett St, New Norfolk.
The collapse is the latest in a long list of Australian construction companies that have gone under as the industry grapples with skyrocketing prices for building materials, rising inflation and labor costs.
Family-owned Multi-Res Builders has collapsed and allegedly left subcontractors unpaid, with the company latest in a growing list of Australian construction companies going under. Pictured, 12 three-bedroom townhouses planned for Boyer Rd, Bridgewater
A notice from the Australian Securities and Investments Commission said the company Multi-Res Builders, led by Colin Barratt (pictured), 62, had filed for bankruptcy on Sunday, with David Joseph Levi appointed as liquidator
The fall of the family business comes just a month after All Brick & Block (Tas) Pty Ltd, a company run by Mr Barratt’s son, Matthew, went into outsourcing.
ASIC reports revealed that All Brick & Block had debts in excess of $2 million.
Evan Graham, CEO of Sydney-based plumbing and drainage company Limcora Pty Ltd, claimed his company was owed about $100,000 by Multi-Res, according to the Mercury.
This included $45,000 for work on townhouses on Nagle Place and about $90,000 for work on residential and commercial developments on Boyer Road.
Mr. Graham estimated that the Nagle Place and Boyer Road projects were worth nearly $10 million each.
The collapse has left contractors unpaid and the future of multiple projects is now unclear (photo, Multi-Res Projects)
The fall of the family business comes just a month after All Brick & Block (Tas) Pty Ltd, owned by Mr Barratt’s son Matthew, went into outsourcing with debts in excess of $2 million (Colin Barratt in third photo from the left)
He also said his calls to Mr Barratt went unanswered and that he only learned of the company’s liquidation through Credit Watch.
‘Now we can’t get in touch at all, it’s gone cold,’ Mr Graham said.
The company’s liquidator, Mr. Levi, said an investigation into the company had begun.
“An investigation has been launched immediately to gain insight into the business, including consideration of the future, regarding incomplete housing, the situation of employees, contractors and creditors, and determination of options,” Mr. Levi said.
“There are a lot of homeowners, creditors and contractors…I expect it will take a few days to establish (details).”
Construction companies are still reeling from the effects of the Covid pandemic and the global shortage of timber and building materials due to choked supply chains affected by the conflict between Russia and Ukraine.
This has caused material costs to increase by more than 20 percent since early 2022, with some items rising even more.
Pine has more than doubled in price, while reinforcing steel, glass, plasterboard, fiber cement and other materials have also increased.
Such price increases meant that many permanent contract construction projects were no longer viable.
Across Australia, bankrupt companies owe hundreds of millions of dollars to subcontractors, traders, customers and the tax authorities.
The latest insolvency data from the Australian Securities and Investments Commission (ASIC) shows that since mid-2021, more than 2,500 construction companies have gone bankrupt, placed in receivership or under receivership.
Some of the biggest names in the Australian construction industry have gone bankrupt in the past year, including Probuild, Home Innovation Builders, Privium, Condev Construction and Pivotal Homes.