Developers for GCB Constructions projects claim they’ll lose more than $56.7m in company collapse
Developers caught in the collapse of Gold Coast builder GCB Constructions say they will lose tens of millions on their stalled projects – but not everyone is convinced. Find out what’s happening with every project.
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Developers caught in the collapse of Gold Coast builder GCB Constructions say they will lose more than $56.7m between them on their stalled projects – but not everyone is convinced.
The flailing builder owes more than $47m to suppliers, subcontractors, lenders, staff and the tax office, with administrators recommending it be tipped into liquidation as early as next week.
A report to creditors by administrator David Stimpson of SV Partners said principals for 13 projects under way when GCB went into administration had taken back their sites.
Some of them have cashed in millions of dollars in bank guarantees given to them by GCB, but maintain they will be millions more out of pocket.
John Goddard, of subcontractor support group Subbies United, was sceptical of the claims, saying developers seldom bore the brunt of a building company collapse.
Mr Goddard said while developers had the benefit of holding bank guarantees and retentions, subcontractors had no such fallbacks.
“They may have some holding costs but it’s never that bad,” he said.
“Developers can get the job back up and running in a few weeks or months.”
Of the six developers that held bank guarantees totalling $8m provided by GCB, five have cashed them in.
Mr Stimpson’s report to creditors said the claims of expected losses by developers had not been substantiated and that they’d been disputed by GCB director Trent Clark.
“We note the combined claims by principals for anticipated losses on the projects are unsubstantiated and cannot be realistically verified until the projects are complete, and an independent assessment undertaken,” the report said.
“At this point, none of the claims will be accepted for voting or dividend purposes until proper documentation is presented to us and an independent analysis undertaken.
“We expect this process to take a significant amount of time, and will be completed if creditors resolve to place the company in liquidation.”
Creditors will have the chance to vote on August 30 whether to tip the company into liquidation.
Across the 13 projects, there were $4.9m in outstanding progress claims payable to GCB; $9.21m outstanding subcontractor claims; $1.42m subcontractor cash retentions held by GCB and $8.01m in bank guarantees issued by the company to the developers.
The 13 projects detailed in the report did not include GDI Group’s Drift Main Beach, or Poly Group’s Ascot Aurora, which are the subject of court disputes.
Status of each project, according to administrators
Marine Quarter Southport (Buildcap): This project was terminated by the Principal on August 17. NAB bank guarantees totalling $2.175m have been cashed.
Outstanding progress claims of $1.178m; subcontractor claims of $2.08m; no cash retentions.
Canopy House (Aria Property Group): The Canopy House project was terminated by the Principal on July 27. The Principal maintains they have incurred losses on the contract totalling $19.9m. Administrators are “assessing the merits of this claim and the recoverability of the progress claims on the project”.
Outstanding progress claims of $2,28m; subcontractor claims of $566,844; no cash retentions.
Cote Palm Beach (Steer): This project was terminated on 10 August 2023. The Principal advises they expect to incur losses of $3.4m. Administrators “will investigate those claims in due course”.
Outstanding progress claims of $475,753; subcontractor claims of $413,729; cash retentions of $192,679.
309 Golden Four, Si Bilinga (IDS Property): This project was terminated on August 21. Administrators have vacated the site and have disclaimed any interest in the site.
No outstanding progress claims; subcontractor claims of $864,918; cash retentions $547,931.
Wategos Byron Bay: The Wategos project was terminated on August 10. Administrators “are pursuing recovery of outstanding progress claims and reviewing claims by the Principal that they have sufferedlosses of $1.5m on the project.”
Outstanding progress claims of $162,057; subcontractor claims of $524,663; cash retentions $471,586.
Sunshine Coast University Private Hospital (Ramsay Health): The project was terminated on July 7. The Principal cashed the bank guarantees of $472,954 prior to the administration. Administrators are “reviewing the Principal’s claim they have suffered losses of $2.88m on the project.
No outstanding progress claims; subcontractor claims of $1.44m; no cash retentions.
35 Garden Street, Southport: This project was terminated on August 8. The Principal has advised they expect to suffer losses on the project however, these losses are yet to be quantified.
Outstanding progress claims of $224,493; subcontractor claims of $171,459; cash retentions $66,883.
Tallebudgera SLSC: The project was terminated on August 14. Administrators are reviewing the recoverability of the progress claims, but note the Principal has advised they expect to suffer a loss on the project.
Outstanding progress claims of $125,953; subcontractor claims of $309,588; cash retentions $130,840.
Vantage View (Rayjon): The project was terminated on July 26. The Principal cashed the bank guarantees of $2.54m upon termination, and have claimed losses totalling $12.68m have been incurred on the project.
Outstanding progress claims of $453,870; subcontractor claims of $775,343; no cash retentions.
Vantage Burleigh (Rayjon): This project was completed and the bank guarantee cashed prior to the administration.
No outstanding progress claims; subcontractor claims of $330,155; no cash retentions.
74 Ballina Street, Lennox Head: This project was completed and the bank guarantee cashed prior to the administration.
No outstanding progress claims; subcontractor claims of $326,404; no cash retentions.
Uniting Yamba: Administrators have disclaimed the project and vacated the site. The Principal advises they expect to suffer a loss of $16.36m, which administrators “will review in due course.”
No outstanding progress claims; subcontractor claims of $1.32; no cash retentions.
Caboolture Private Hospital (Ramsay Health): The project was terminated on July 27.
No outstanding progress claims; subcontractor claims of $89,450; cash retentions $16,613.
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