Buyers of 283 Auckland apartments have been caught up in the receivership of national builder Ebert Construction and are waiting nervously to hear how long this might delay the building projects.
Completion and final sign-off is expected on the two huge Auckland blocks, after buyers paid deposits for millions of dollars worth of places in the projects, now locked down by PwC receivers while they undertake investigations into the big building business and its many projects.
The biggest Auckland apartment project is the half-finished Union Green where 153 apartments were being built by Ebert and its contractors on Union St in the CBD.
And 130 units in the first stage of the planned 300-unit Library Lane at Albany were also built by Ebert but are awaiting final sign-off or practical completion certification before people can move in.
John Fisk, PwC receiver, said yesterday Ebert owed around $40 million, had 95 staff and 15 projects throughout New Zealand and he expected a "shortfall", meaning many creditors could go unpaid after the company's own directors took action following what Fisk said were big problems on one big Auckland site.
Lawyers said yesterday they expected delayed settlements on many apartment purchases and had heard from concerned buyers, wondering what would happen. Banks are also exposed, having loaned to the developers who were relying on Ebert to complete the apartments, one lawyer said.
Anita Yang, a director of Yu Lawyers representing Library Lane's developer, yesterday gave a written update on the Albany project.
"Our client is extremely surprised by this news because, as recently as yesterday morning, it had held an on-site meeting with Ebert's managers to call Ebert to account for its failure to achieve practical completion on or before 31 July 2018 as Ebert had previously promised, and to discuss the revised timeframe under which Ebert was required to complete the balance works," she wrote.
"Our client is very disappointed by this recent turn of events and it is most embarrassed by the current situation."
Before news of the receivership broke, customers were already frustrated by the lack of progress in the final stages of Library Lane.
David Liu of Yu Lawyers said although practical completion had not been issued, it was expected soon and buyers should be able to move in shortly, but he could give no definite time frames.
Developers of both blocks said buyers would be informed only when they received information about Ebert's fate and what would happen on the projects where contracts were signed with Ebert as head contractor.
Farhad Moinfar, a director of Myland Partners which is developing Union Green, said this morning he was doing all he could but knew very little and would provide new information as he received that.
"We did get inquiry from buyers and we could not say much more than we could tell anyone else - it was news to us yesterday morning," Moinfar said of the receivership. The business would be able to provide a buyer update once it had information and that would be via its solicitors Glaister Ennor, he said.
Union Green is at 39-47 Union St near the Southern and Northwestern Motorway onramps at Spaghetti Junction, directly behind the new Sugartree apartments between Union St and Nelson St.
Moinfar said Ebert had got up to level six of the 12-level tower and he did not know who would complete the project or when. The site is one of about 15 where Ebert was working, now secured by the receivers to the point that people could not even retrieve equipment and tools yesterday.
Moinfar struck problems even getting a builder.
"It's probably taken longer to secure a builder in this construction market than we would have anticipated but that's the same for anyone in this market. We hoped to start on-site in April. So it's just a few months behind," said Moinfar in 2016.