Victorian construction company Snowdon Developments goes into administration

The company has been struggling to pay creditors and staff for months and customers are desperate for answers. Now their worst fears have been realised.

An embattled Victorian building firm has gone into voluntary administration.

Snowdon Developments Pty Ltd held a crisis meeting at 9am on Friday where staff were informed they were being let go because the company had appointed administrators.

The meeting went for an hour, finishing around 10am, and when employees left they were visibly upset.

“Staff have been told to hand in their stuff,” an insider told news.com.au, with laptops, phones and other company items needing to be returned in the next few days.

It’s understood the company’s owners had the option to stand down or be terminated and they chose the latter. They also attended a meeting on Thursday with the Department of Treasury to see if a government bailout was a possibility, news.com.au understands.

Staff are owed about three weeks’ worth of pay which was meant to be paid on Monday. Although they were given a pay slip, no money was deposited.

When news.com.au tried to contact Snowdon, their office number went to an automated message advising the caller to ring back during business hours — even though it was around 10.45am on a Friday.

News.com.au has contacted Snowdon’s director, Chris Sandner, but he did not immediately return our request for comment.

ASIC documents obtained by news.com.au confirm the company has gone into voluntary adminisation.

It comes just a week after news.com.au raised concerns about Snowdon Developments when investigations revealed staff had not been paid superannuation for months, creditors were owed millions of dollars and customers’ builds had stalled. More than 200 homes were in the pipeline to be built.

The offices where Snowdon held the crisis meeting.

Victorian construction company Snowdon Developments goes into voluntary administration

“It [the meeting] was emotional, the owners were there as well,” the insider continued.

Staff left the termination meeting at Snowdon’s Keilor Park offices and several angry tradies were waiting outside demanding their money.

Fifteen creditors took legal action against Snowdon Developments in April with their debts totalling $2.5 million. They demanded the Supreme Court of Victoria impose a winding up order to force the company to go into liquidation “on the grounds of insolvency”.

The biggest debt was $936,192. It’s understood some of that was paid off and that Snowdon was planning to sell a property on July 4 to cover the rest of their debts.

However, the company went under before the property sale was able to settle.

After news.com.au broke the story last week, other creditors came forward, with one man claiming he was owed as much as $480,000. Another person news.com.au knows of is owed around $600,000.

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Snowdon has officially collapsed.

A crisis meeting was held this morning.

Staff have also been beset for months as they cop abuse from unpaid contractors and frustrated customers while also receiving no superannuation payments from their employer.

Since October, superannuation has not been paid, leading to more than 50 per cent of staff quitting between then and now.

Snowdon Developments used to have around 70 staff but only around 30 were left to attend the crisis meeting.

Logan, who has worked at the company for a number of years, said staff learnt several months ago that they were not receiving the money supposed to be going into their superannuation.

Although it appeared super was being deposited according to their pay slips, one staff member went into their superannuation fund and realised no money was being put in. They then alerted the others.

“Then we asked [the company and it] confirmed that no super was being paid. And then nothing much has been said about it since,” Logan told news.com.au.

A photograph of creditors parking in employees in the hopes of getting their money back.

Snowdon staff are beset by problems on all sides, according to Logan, with his colleagues being accosted by angry creditors or customers.

“We get trucks parked in the car park blocking our cars so we can’t go out because they [the tradies] haven’t been paid,” he explained.

The source told news.com.au that some staff are not answering phone calls from unknown numbers from fear of frustrated clients or suppliers being on the other end.

MD Demolitions is one of the companies owed thousands.

Michael Hassan’s company MD Demolitions was one of the 15 creditors taking Snowdon to the Supreme Court after waiting for more than six months for $103,000 owed to be paid back.

Mr Hassan, with three young kids to support as well as 30 staff who work for him, has visited Snowdon’s Keilor Park office six times trying to get his money.

“There was no money coming into the account to feed the family or pay off the workers,” he previously told news.com.au.

“It’s just sad, I’ve been to the office, I said ‘I’m desperate, I need the money’.

“If I didn’t have financial support behind me, the bank would have taken my property by now.”

Nick Mihajlovic, 67, contracted for Snowdon through his bricklaying business for 22 years and claims he is owed $480,000 from work done all the way back in 2019.

“I’m financially ruined,” he said. “I’m 67 years of age and I’ve got to keep working.

“I came back to brick laying, I’ve got to make money, all my debts to pay.”

Nick Mihajlovic claims he is entitled to $480,000.

More than two dozen customers that spoke to news.com.au have been waiting months and in some cases years for their homes to be built.

Customers are uncertain what this means for them and the money they have already given out to Snowdon Developments in progress payments.

One Melbourne customer, Saurabh Mittal, 40, has missed out on a $25,000 government grant because his build site remained untouched for more than 18 months.

To meet the criteria for the government HomeBuilder grant, building had to have begun on his site within 18 months of entering into the HomeBuilder contract, which would have been the end of May at the latest.

The same went for Josh Curmi and his wife, aged 29, missed out on a $15,000 grant for the same reasons.

Josh Curmi and his wife have missed out on a $15,000 grant and also have sunk around $10,000 into the project.

Saurabh Mittal missed out on a $25,000 grant and also he’s spent around $11,000, and wonder whether he will ever see that money again.

Rebeeca Cook, a high school science teacher, is concerned as her home is partially built, making it harder to bring a new builder on board.

The 26-year-old has so far forked out $44,000 and was meant to move into her new home in March.

“I want them to finish my house,” she told news.com.au last week, prior to the company officially collapsing. “The prices are skyrocketing, I don’t have the funds to fork out another $50,000 for a build.”

Rebecca Cook’s partially constructed home.

Rebecca Cook cannot afford another $50,000 on another builder now that Snowdon has been placed into administration.

Some customers are relieved that the company has officially gone under and are hoping it eventually gets to a liquidation stage as they will finally have some certainty after so long of having their calls going unanswered.

Mira Vose, who has spent more than $30,000 on progress payments so far, told news.com.au “Snowdon going into liquidation would mean that we are able to move on from them because we will be able to claim from the insurance and work with another builder.”

“If they liquidate then we can finally get something done,” Mouna* told news.com.au.

Greg* added: “This may actually give us an opportunity to actually get accurate information and work constructively towards a real solution.

“Snowdon have been vague and evasive and constantly giving excuses.

“At least now we have a chance to communicate.”

*Names withheld for privacy reasons

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Originally published as Victorian construction company Snowdon Developments goes into administration