This article is from the Australian Property Journal archive
ANOTHER Queensland building firm has appointed liquidators as rising construction materials and labour costs continue to smash builders.
It comes just days after the collapse of Pivotal Homes, while the country’s largest home builder Metricon received a $30 million capital injection from its owners and support from the Commonwealth Bank as it sought to ward off ongoing industry and media speculation about its viability.
Another Queensland company, Condev, collapsed in March with $1 billion worth of projects – just two weeks after construction giant Probuild called in administrators with $5 billion worth of projects on the go, rocking the industry.
Solido Builders, based in Cleveland, specialises in bespoke luxury homes. It was established in 2014 by John Hattink and his wife Libby.
Hattink told The Courier Mail that the company had a made a loss on a few projects and its sub-contractors had been paid.
Pivotal Homes had over 100 houses under construction and nearly 180 waiting on council approval. The company’s managing director, Michael Irwin last week blamed rising labour and construction costs for the company’s collapse.
“In my 30 years’ experience I have never seen a set of circumstances like this and obviously we are not alone in these unfortunate conditions facing the industry.”
Building materials supplier Southern Star Windows’ boss Paul Armstrong told Australian Property Journal that the cost of timber had risen by at least 35%, along with rises in aluminium and glass.
Charter Keck Cramer associate director Richard Temlett said industry sentiment is that house building costs will increase by around another 10 to 15% over the next 12 months due the continued impact of China’s COVID-zero policy and Russia’s invasion of Ukraine.
The latest data from the Australian Bureau of Statistics revealed skyrocketing home building costs was the lead contributor in pushing inflation to its highest level in 20 years.
Meanwhile, talking to the company’s capital injection and CBA backing, Metricon CEO Peter Langfelder said industry and media speculation following the sudden and unexpected death of company founder Mario Biasin is now impacting the company, and Metricon’s owners wanted to demonstrate their commitment to the future of the company.
