Building giant facing $28m collapse shuts Brisbane projects

One of Queensland’s biggest construction companies Privium Group, led by Rob Harder, has shut down building operations across Australia amid mounting losses that have topped $28m.

One of the state’s biggest construction companies is shutting down the bulk of its building operations with warnings it could collapse owing subbies more than $20m.

Logan-based Privium Group had told customers that it would transfer uncompleted projects to a separate builder called Torsion after warning its finances were deteriorating.

It is believed 150 homes will be transferred.

Privium reported a loss of more than $28m last year as the construction industry felt the impact of shutdowns, labour shortages and price hikes caused by Covid-19. However, in the same period it paid dividends in excess of $18m.

“As you are well aware, the last six months have been very difficult in our industry with the continued supply and demand challenges, significant price increases and ongoing lockdowns with Victoria and NSW,” Privium said in a letter to clients. “Due to the volume of builds … this has had a significant financial impact on the Privium Group.”

In a separate letter to a client from Privium, chief operations officer Troy Seaward warns a large number of projects are on hold until further notice while the company manages “workflow complications.”

Interior of a Privium display home

“Right now I do not know when your property will commence,” said Mr Seaward. “Privium is currently experiencing delays and complications across the entirely of its operations.”

Privium was named 11th biggest builder in Qld by HIA this year and completed more than 600 projects worth $183m last financial year.

In 2019, the company offered clients a new MG car when they moved into their home and also had employed celebrity chef Neil Perry to give cooking demonstrations.

Privium told clients and their lawyers last month that they should transfer the contracts signed with Privium to Torsion or risk the homes “being placed on hold indefinitely.” Torsion is a private company established in 2018 and based in Cornubia.

Privium traces its roots back to 1996, when directors Rob Harder and Andrew Clement collaborated on their first project in South East Queensland. Since then the builder has expanded across Queensland, New South Wales and Victoria.

A Privium display home

Privium said its construction arm would continue to facilitate construction of projects in collaboration with Torsion. “Torsion understands our systems and will be able to work with us in an efficient manner to ensure that any active jobs will be able to proceed largely uninterrupted,” the company said. Comment has been sought from Privium.

Privium’s auditors Ernst & Young warned in 2020 that given the evolving nature of the pandemic, potential impact on the company’s operations and financial position could not be reliably estimated. This included the unavailability and delay of products and supplies.

A Queensland Building and Construction Commission spokesperson said the licence of Privium remains active.

The spokesperson said a licensee must at all times be able to demonstrate to the QBCC that it has sufficient assets to support the value of the work it is undertaking.

It said the watchdog was not involved in any transfer of contracts, known as novation “These are usually matters between a home owner, their original contractor and their proposed new contractor,” the spokesperson said. “Consumers considering the novation of a contract are encouraged to seek independent legal advice.”

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