Homeowners and tradies have been left reeling by the news that yet another construction firm has collapsed, leaving them thousands out of pocket.
On Monday, NSW building company Allura Homes Pty Ltd went into liquidation.
The firm, which was based on Sydney’s lower north shore in Lane Cove, had 39 residential projects underway, which have now been placed in jeopardy.
The appointed liquidator, Dane Skinner of insolvency firm Raft Consulting, said these homes were at varying stages of completion.
“There is a variety – from initial deposits with letters of intention to construction phase and practical completion, subject to defect claims,” he told news.com.au.
All 11 employees of the firm lost their jobs on the spot, although it’s understood four had quit before liquidators were called in.
This marks the third construction company in as many days news.com.au has revealed to have gone bust, as the building industry continues to struggle in the current inflationary environment.
According to Mr Skinner, at this early stage of his investigation, Allura Homes appears to have racked up debts totalling $3.3 million.
Despite the staggering debt, the business only has assets estimated to be worth $160,000.
The firm so far has 102 creditors. The largest amount owed is $143,000 to a trade creditor and $507,000 from an unsecured loan.
Among the list of creditors is also the tax office, owed $315,000, according to preliminary estimates.
“The company’s inability to keep up with inflation pressures” was to blame for its failure, Mr Skinner said.
“My office retained company employees to inspect all sites and ensure they were secured on appointment,” he added.
“My office has made arrangements with the fencing supplier, Hire Rite, to ensure no fencing is removed and provided the customers details to the supplier so that current and future security is maintained by the owners.”
News.com.au knows of one house under contract with Allura Homes that sat idle for eight months.
Tradies who visited that site bemoaned the fact they had not been paid to neighbours.
Those tradesmen attempted to remove safety fences last week but the owner convinced them not to.
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It comes as the entire building industry is in crisis because of supply chain disruptions, skilled labour shortages, skyrocketing costs of materials and logistics, locked-in price contracts and extreme weather events.
So far this year, more than a dozen builders have collapsed.
Just 24 hours ago, news.com.au revealed Melbourne builder Kleev Homes had gone into liquidation, owing $3.29 million to 162 unsecured creditors.
And just the day before that, this publication also reported on the collapse of Kleev Homes, news.com.au also revealed that another Melbourne builder, Avra Group, had also bitten the dust.
Earlier this month, news.com.au also revealed that two building companies collapsed just days apart, NSW-based luxury builder Millbrook Homes and Victorian residential construction firm Bentley Homes.
Also in July, Perth-based building company Flexible Homes bit the dust.
Last month, news.com.au also reported that Melbourne construction firm Red Bluff Homes had gone into liquidation amid a dispute with a customer over suddenly cancelling the contract while Western Australian firm, the Slatter Group, also went into liquidation in June.
Australia’s 13th biggest builder, Porter Davis, also collapsed earlier this year, placing 1700 projects and another 779 empty blocks of land in jeopardy across Victoria and Queensland, while more than 1000 unsecured creditors owed a whopping $71 million.
alex.turner-cohen@news.com.au