Residence Building Group joins string of collapsed builders in South Australia

Yet another SA building company has gone into voluntary administration citing Covid and HomeBuilder pressures as their debt explodes.

Managing director of Residence Building Group Dave Menner. Pic Roy VanDervegt

A boutique South Australian building company has entered voluntary administration on Tuesday after accumulating millions in debt.

The Residence Building Group appointed Agile as its voluntary administrator breaking the news via an email according to a report by ABC.

“This is not a decision that I have come to without doing everything in my power to keep the doors open, to deliver clients’ projects and keep my staff in employment,” managing director David Menner said.

“The effects of Covid, combined with the pressure the HomeBuilder program placed on the industry, inflation and a fixed price environment, has culminated in incredible pressure being placed on the sector to deliver homes without significant losses.

“For smaller, boutique businesses such as mine, the pressure has been too great.”

Dave Menner in 2017. Picture: James Elsby

The administrator Agile told ABC there were seven residential clients affected, six in Adelaide and surrounding suburbs, as well as one in the hills.

Construction work on all projects has been stopped as the administrator will spend the next month working on plans.

It said the debt of up to $2m was owed to investors and the Australian Taxation Office.

Four staff, including Mr Menner, have not had their positions terminated at this stage.

The email detailed Mr Menner’s two-year attempt to stay afloat and how he hoped to work with another building company to provide clients the option to quickly transition their projects.

Residence Building's David Menner (L) and NDA Law's Joshua Michaels (R) on a construction site in 2022. Pic Roy VanDerVegt

Staff from Residence Building Group who continue project managing jobs.

“My deepest sympathies to my clients, equity partners, trades and suppliers,” Mr Menner wrote.

“This is an unprecedented time for our sector and I can only hope other businesses are able to come through the other side.”

Mr Menner unsuccessfully stood to become local mayor of Prospect last year.

The collapse comes after Qattro went under last month leaving more than 200 customers in the dark and debts of more than $4.5m to unsecured creditors.

It was the second prominent South Australian builder to collapse in a matter of months, with Felmeri Homes placed into liquidation in July.