Oracle Homes in liquidation with customers, suppliers left in the lurch

Embattled building giant Oracle has collapsed leaving 300 homes unfinished across the country and owing $14m.

Queensland building giant Oracle Homes has collapsed owing $14m and leaving 300 homes unfinished across Queensland and NSW.

Underwood-based Oracle Building Corp – which trades under a number of names including Oracle Platinum Homes and Oracle Hunter Homes– made headlines earlier this year when it sought tens of thousands of extra dollars from clients to complete their homes amid the deepening financial crisis in the construction sector.

Liquidators Bill Cotter and Roland Robson, of Robson Cotter Insolvency Group, said close to 300 homes owners had been impacted by the collapse.

“Projects range from not yet commenced through to nearing completion,” said the liquidators in a prepared statement. “We understand that total creditor claims, including secured and unsecured creditors, may be in the vicinity of $14m.”

Oracle joins a growing list of Queensland building firms. including Privium Homes, BA Murphy and Condev, hitting the wall in the past year.

Mr Cotter and Mr Robson said company director Tom Orel was fully cooperating with liquidators to maximise recoveries for creditors.

“Mr Orel has highlighted the well known difficult circumstances prevailing in the construction industry, including the recent and rapid rise in construction costs,” they said.

“These factors resulted in cost overruns and delays in project completions, which severely impacted the company’s cash flows and its capacity to continue to operate despite the owners and staff’s best endeavours.”

Queensland building giant Oracle has collapsed, potentially leaving hundreds of homes unfinished.

Creditors and suppliers have been circling Oracle in recent months over unpaid debts with one taking a caveat over the $5m Gold Coast mansion in which company founder Tom Orel lives with his wife Elia. The company employed about 70 people.

Clontarf-based Dynamic Bradview Roofing launched Supreme Court action this month to recover $910,000 from Oracle over the supply of building materials for homes across Queensland and NSW.

At least two other suppliers - Raven Roofing and Regency Showerscreens and Wardrobes - also had launched debt recovery actions against Oracle.

As its financial situation deteriorated, Oracle demanded up to $120,000 from some home builders before they could move into their homes, sparking a warning from the building watchdog to seek legal advice before paying any extra money.

In a letter to his customers earlier this year, Mr Orel said the increase was blamed on “ongoing ripple effects” of the pandemic causing supply shortages.

Oracle Homes director Tom Orel.

At the time it was understood the company was working on 300 new homes across Queensland with about half facing price increases. Clients continue to complain about lengthy delays, some of up to a year, to complete new homes.

Mr Orel wrote to tradespeople earlier this month stating that the company could not pay suppliers.

He said that the company was “still waiting for a number of external settlements which have not occurred and we regret to inform you that there will be no payments made today.”

“I reiterate and say all payments have been administered on our end and are ready to go,” Mr Orel wrote in the email. “As soon as the funds hit our account the payments will be processed. Thank you again for your support as we navigate these times and we will continue to keep you updated of any changes.”

Oracle customers took to Facebook on Wednesday morning to attack the failures of the company. “During the course of our time with Oracle, my mental and physical health have been substantially impacted,” one customer said. “The thing I struggle with the most in dealing with Oracle is their lack of communication and transparency. It is because of the way they have handled themselves that people are in this situation. The situation being their lives. The bigger they are, the harder they fall.”

Jess Petersen wrote: “We signed in January last year and they poured our slab in April this year in a rush because the bank was going to close our construction loan and they weren’t going to get any money”.

Oracle Platinum Homes’ display home

Janet Brooker posted: “My granddaughters house after two years is still only a slab and half a frame. Absolutely atrocious.”

A spokesman for the Queensland construction watchdog the QBCC said it has set up a dedicated team to handle the non-completion claims from homeowners affected by the Oracle collapse.

“We will be doing everything we can to help them continue to get their homes built,” he said.

“We are in the contacting all 386 policy holders who have taken out policies with Oracle Homes during the past two years to let them know how to lodge a claim with us.

“In the meantime, however, homeowners are encouraged to contact us on 139 333 for information about lodging a claim, to get the process started as soon as possible. They can also visit the QBCC website or contact us via social media.”

Oracle’s collapse is part of a wave of Queensland building company collapses that have cost tradespeople, suppliers and customers hundreds of millions of dollars.

Last week, Brisbane-based Besse Construction with 30 employees collapsed owing $1.7m. Earlier this year luxury home specialists Solido Builders and Pivotal Homes on the Gold Coast also went into liquidation.

In March Condev collapsed with 18 projects across the Gold Coast. The company was founded and led by Steve and Tracy Marais, who cited rising construction costs, supply chain issues and the recent floods for adding pressure to already slim margins as the reason for calling in the administrators.

Interstate failures have included Inside Out Construction, Dyldam Developments, Home Innovation Builders, ABG Group, New Sensation Homes, Next, Pindan and ABD Group.

A former contractor with Oracle, who did not want to be named, said: “The forgotten thing in all this is some of the staff,” he said. “I can tell you that sales staff have not been paid commission for six to 12 months and some have lost in excess of $200,000 to $300,000 in commission. The sh*t hit the fan in all this was about 12 months ago.”