Further issues have come to light in the building sector. Photo / supplied
Further issues have come to light in the building sector. Photo / supplied
A new string of new building company failures and demands from creditors has come to light in further evidence of the struggling sector, with liquidation notices and reports out in the last few days on four businesses.
Auckland-headquartered school and housing builder Goshen Construction owes nearly $1 million to securedand unsecured creditors, according to the first report out from liquidators on Thursday.
Yesterday, Tauranga's Tiki Interiors advertised its application to put Hamilton's Latham Builders into liquidation.
On Monday, The General Builder's liquidation was advertised. That business is now in the hands of EY's Rhys Cain and Rees Logan, yet to issue the first report. Creditors are asked to lodge claims by November 21.
At the same time Dunedin heavy machinery business P L Clarke advertised its intention to put Project Worx 2020 into liquidation. Project Worx office is at Auckland's Flat Bush and it says it is in the construction management business.
Peri Finnigan and Iain McLennan of McDonald Vague issued their first report on the Auckland builder Goshen C, estimated to owe around $954,000.
Delays, dispute progress payments and contract terminations were blamed for the failure of that business, trading from Rosedale on the North Shore and wholly-owned by Jae Chan Hyun who is the sole director.
Windy Ridge School at Glenfield, Bairds Mainfreight Primary School in Otara, Te Papapa School in Onehunga and Pomaria Primary School in Henderson are all listed on Goshen's web site as projects where it has worked and where jobs are finished.
Work at Mahurangi College at Warkworth is listed as a "project in progress".
Housing projects on Great North Rd, at Hobsonville Point and the neighbouring Scott Rd at Scott Point. A ceiling job at Botany Town Centre also appears on finished work.
"We cater to residential and commercial clients nationwide," the business says on its web site.
But Jae Chan Hyun told the liquidators of problems he said caused issues, as well as "the departure of a key employee to a rival construction company that has since taken over the contracts."
The construction sector continues to suffer failures. Photo / George Novak
Unsecured creditors, including building material suppliers, were owed about $829,000 but a further $56,000 was owed to related parties in salaries and holiday pay.
Few assets were available to realise so no creditors' meeting is proposed.
Secured creditors are owed $69,000. They are Placemakers Mt Wellington, Carters Building Supplies, Toyota Finance NZ, Anderson & O'Leary, Ricoh Finance, Just Sheds, Royal Wolf, Fletcher Distribution trading as Placemakers Whangaparaoa, Albany Timber Distributors, Franklin Plumbers & Building Supplies and Continuous Spouting Auckland.
All vehicles had been returned to creditors, the liquidators said.
Earlier this month, North Island building company Stanley Group and related companies went into liquidation along with Tallwood Holdings and its subsidiaries based in Takapuna, Auckland, and Matamata in the Waikato.
The business, reported to have about 100 staff, had projects on the go for Housing New Zealand in Mangere, Hamilton and Whakātane.
The Herald has reported on a string of failures lately.
Christchurch branch of contractors JFC is closing due to lack of work in Canterbury, although the Auckland office remains viable and will stay open, a representative said in June.
National builder Ebert Construction went into receivership last year with claims of $108 million.
Arrow International had around 450 staff and annual revenues of more than $350m but this year, it went into voluntary administration and is now in liquidation.
Last year, Orange-H Group - the McConnell entity set up to run down the residual Hawkins assets after the sale to Downer Group - went into receivership just 10 days after being ordered to pay $13.4m over a leaky school.
Canam Construction left an Alexandra Park apartment job and litigation has ensued over that. Corbel Construction has left the Parnell Terraces leaky townhouse buildings in Auckland.
James McQueen, national construction and real estate leader at BDO's Auckland office, said building businesses were bidding for construction jobs on razor-thin margins as low as 6 per cent. Such knife-edge margins meant builders either suffered losses or made extremely slim profits, he said.
* Bud Latham of Latham Construction 2004 in East Tamaki said he and his firm had no connection to Hamilton's Latham Builders.
