Troubled builder blames developer after licence suspended

A CONSTRUCTION company that owes subbies up to $9 million has blamed the developer of a West End highrise project for the company’s financial plight.

TROUBLED Sommer and Staff Constructions has blamed the developer of a West End highrise project for the company’s financial plight.

The 44-year-old company last week had its license suspended by the Queensland Building and Construction Commission (QBCC) because of concerns it would not be able to pay its subcontractors. It is estimated it owes subbies up to $9 million.

The suspension left the 106-unit Citro Apartments in West End, being developed by Melbourne-based Equire, partially completed.

Citro apartments on Victoria Street, West End. Work stopped on the site about 12 weeks before completion. Picture: AAP

Sommer and Staff Constructions secretary Natasha Sommer-Burley has alleged Equire were short about $5 million in funds to complete the project, with the bank refusing to lend them anymore.

Ms Sommer-Burley also said the developer was invalidly holding $3.1 million in payments due to Sommer and Staff.

“This whole issue exists from them not being willing to pay for what they are getting — nothing more, nothing less,” she said.

Equire has denied claims it was withholding payments and had not paid subcontractors.

Equire general manager Tiel Lillehagen said the company terminated its construction contract with Sommer following numerous concerns and subsequent evidence that it would be unable to fulfil its obligations and complete the Citro development.

Mr Lillehagen said this was supported by the QBCC’s decision to suspend their builder’s license.

The suspension left the 106-unit Citro Apartments in West End, being developed by Melbourne-based Equire, partially completed. Picture: AAP

“Our duty is first and foremost to our purchasers, and as such, it was important we took swift action and immediate steps in seeking to appoint a new builder on the development,” he said. “We will continue to communicate regularly with our purchasers, keeping them informed on the new timeline of the development.”

The project was about 12 weeks from completion, according to Equire.

Founded in 2017, Equire specialises in residential property development in Victoria, Queensland and Western Australia. It was founded by BRW Rich Lister Allister Lewison.

QBCC commissioner Brett Bassett said the building watchdog was targeting builders who were operating beyond their financial means.

Mr Bassett said a recent investigation had led to 12 licence cancellations of building companies operating under high-risk financial circumstances.

“This sort of financial mismanagement is risky,” said Mr Bassett.

“It’s risky to employees of the company, it’s risky for sub-contractors and suppliers working with the company, and it’s a risk to the local community and customers.”