Rising costs bring down Brisbane subbie Tacoma Plumbing and Drainage
A Brisbane subcontractor working on some big projects in the city has collapsed in the latest sign of trouble for the construction sector as it faces rising costs and supply disruptions.
City Beat
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Brisbane construction-related company Tacoma Plumbing and Drainage has collapsed after rising labour and material costs due to Covid-19 savaged its bottom line.
SV Partners managing director Terry Van Der Velde has been appointed administrator of the Pinkenba-based firm established in 1996 that had worked for some of the state’s biggest building companies including Hutchinsons, Lendlease and McNab.
Employees were advised on Monday that the business had been placed in voluntary administration with rival plumbers reportedly looking to take over unfinished projects.
The amount owed to creditors has not been established but industry sources say the firm is currently working on the Ambrose project at Milton for Hutchinson Builders, Silk One at Woolloongabba for Tomkins and six other sites around south-east Queensland.
In a letter to staff, directors Rod Fidler and Geoff Parker said the business had been hit by rising labour and material costs brought on by Covid-19.
They said that “despite our considerable attempts at managing the cashflow, injecting substantial sums of monies into the business to cover shortfalls” the snowballing effect of rising costs had forced the closure of the business.
“This is a position that neither of us have ever contemplated, let along experienced in our lifetimes,” Fidler and Parker said. “Tacoma is not the first, and certainly not the last to suffer from these effects.”
Hutchinson Builders boss Scott Hutchinson tells City Beat that the construction giant would bring its own team of plumbers in to help complete the work at Ambrose. Hutchinson predicts more building firms will collapse due to shrinking profit margins.
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