Voss payout rated a letdown

By ANNE GIBSON

Building industry chiefs have greeted with disappointment the final payout on a Wellington construction company's windup.

The payment of only 6c in the dollar to creditors of Voss Construction has irked Auckland construction arbitrator Geoff Bayley and Building Subcontractors Federation chief Peter Degerholm.

Voss, a medium-sized family building company, went into liquidation in July 1998, owing more than $8 million.

Liquidator Ferrier Hodgson announced the low level of payout to creditors in Auckland on Monday. The 6c in the dollar compares to the liquidator's predictions at the time the firm went under that creditors would get between 30c and 40c, estimates which were later revised down to about 28c.

Mr Bayley said the announced payout to creditors was disappointing.

"It certainly means anyone going down the process of liquidation can't hope for a great return. It's absolutely ludicrous.

"That's the reason most people don't try to liquidate because it just leaves them high and dry," he said, adding that payouts were usually only 1c for every dollar owed.

Mr Degerholm concurred, saying the final payout rated only a small mention in the media, as the collapse had occurred more than two years back and most creditors had written off the money long ago.

Mr Bayley said the impact of collapses such as Voss' were felt through the entire economy because the construction industry contributed about 6.2 per cent to total GDP, he said.

Between March and May alone, eight contractors and subcontractors either become insolvent or ceased trading.

He estimated the effect of that on the economy at $131.5 million in lost turnover and 1000 jobs.

Voss had six projects in hand when it collapsed.

Liquidator Grant Graham said at the time that the company had been brought down by the $7 million 44-unit Sirocco apartments in Church St, Wellington.

Voss, which took over the contract part-way through, was the second builder to run into difficulties with the apartments, designed by architect Roger Walker.

Other Voss jobs were the St Paul's apartment complex in Thorndon, townhouses in the same suburb, the construction of the South Korean Ambassador's official residence in Khandallah, a BP service station in Lower Hutt, and a private residence in Carlton Gore Rd, Auckland.

The ambassador's residence was worth $2.5 million, has five bedrooms and has a reception area the size of Government House. It was designed by Wellington architect David Pawson and is in Ramphal Tce. It has a curved Korean-style roof as its main feature.

In late 1998, the number of Voss creditors was estimated at 500. They were mainly unsecured subcontractors and suppliers. At that time Mr Graham said the cost of completing the St Paul's apartment complex in Thorndon was $1 million more than the Voss contract price.