Max Key ‘rattled’ as Teak Construction liquidation hits subcontractors

Max Key has taken to Instagram to say he’s “rattled” by the collapse of Auckland construction company Teak Construction.

Key said his residential construction business Key Companies is owed “well into” the range of “six figures”.

“We finished the work, we handed over the documentation, we provided the warranties,” he said.

“Then the head contractor went into liquidation. Our business is owed well into six figures, I’ll be honest, that’s rattled us.”

Key said it wasn’t just about him, and there are many other electricians, plumbers and subcontractors caught in the same situation.

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Earlier this week Key asked his Instagram followers if he should release a “tell-all” on the situation. Key said he would follow up with a part two.

MTK Capital, a company associated with the son of former Prime Minister Sir John Key, has been listed as a creditor to the failed firm.

Teak owes creditors $7.9 million in debts but has an asset total of $6.4m, according to a liquidation report released this week.

The building company was involved in several substantial projects across Auckland, contracting out works to a range of subcontractors such as Key.

Shareholders appointed liquidators to Auckland's Teak Construction on March 2. Photo / Teak Construction

Raine Selles, a construction law expert for Concordia Resolution, last week said Teak’s conduct was disappointing.

“Teak has put itself in liquidation after fighting subcontractors for months in court and adjudications over ... withholding of retentions and other sums due.

“Let’s see if those retentions are actually held in trust as they have constantly advanced by themselves and their lawyers.”

Operating for 34 years, Teak claimed on its website to have “built a solid reputation for consistently high-quality construction”.

“We are New Zealand-owned and operated and have deep foundations in fairness, transparency and reliability.

“We’ve cut the ribbon on more than 500 successful builds, from commercial projects, to government, remedial and residential works.”

Victopia Apartments is one of the projects Teak Construction Group was working on before the liquidation. Photo / Dean Purcell

PFK Corporate Recovery’s Steve Lawrence and Chris McCullagh have been appointed by shareholders to handle the liquidation.

Several prominent businesses in the construction sector have securities with Teak, including PlaceMakers, Carters, Mico and Hilti New Zealand.

It is unclear if MTK Capital had acquired security in relation to the insolvent builders, with unsecured creditors expected to face a battle reclaiming their debts.

Working across residential, interiors and painting, the company has been involved in more than 20 projects since it was founded in 2019.