Building firm Bloomer enters administration owing $14 million

ADMINISTRATORS have been appointed to a Brisbane-based construction company that owes creditors an estimated $14 million.

Bloomer joins a growing number of building companies going into liquidation amid a downturn in the state’s construction sector.

BRISBANE-BASED Bloomer Constructions has gone under owing creditors an estimated $14 million but there has been rare praise from subbies seeking repayment.

Bloomer, a subsidiary of ASX-listed Onterran, is the latest builder to falter amid difficult conditions in the southeast Queensland’s saturated apartment market.

Subbies United spokesman John Goddard said that while subcontractors were still owed a substantial amount of money, Bloomer had helped to repay some debts.

“About $10 to $11 million has been repaid over the last three months,” Mr Goddard said, adding he is owed about $400,000 by Bloomer.”They have tried to do the right thing and it something I have not seen before.”

Onterran, which also owns Couran Cove resort on South Stradbroke Island, called in voluntary administrators Trent Devine and Sule Arnautovic last week amid mounting losses.

The company generated revenue of $235 million last year but made an underlying loss of $1.4 million as margins narrowed.

Bloomer said last month that it would seek to transfer its current contracts to other builders as it wound down the business.

Bloomer joins a growing number of building companies going into liquidation amid a downturn in the state’s construction sector.

Mr Arnautovic said the company owed subcontractors, suppliers and secured creditors between $13 and $15 million and was in turn owed about $8 million for work completed.

He said it would be up to the company’s creditors whether Bloomer was liquidated or subject to a restructuring that allowed repayment of creditors.

A creditors meeting will be held this month.

Bloomer may seek to enter a deed of company arrangement, which is a binding arrangement with creditors about repayment of debt.

Mr Arnautovic said Bloomer was no longer trading but had a small team of employees undertaking maintenance. The company had no outstanding projects.

The Queensland Building and Construction Commission issued a show cause notice on Bloomer earlier this year after concerns it was struggling and had stopped work on projects.

Bloomer joins a growing number of building companies either disbanding or going into liquidation amid a downturn in the state’s construction sector.

Administrators were appointed to Newstead-based CKP earlier this month after it racked up debts in excess of $3 million and left four uncompleted projects around the city.

Brisbane/Gold Coast-based Cullen Group collapsed just before Christmas, owing subbies an estimated $18 million and leaving a string of uncompleted projects.

Onterran, which owns said it also would sell its McGrath Modular business, which builds prefabricated homes in Western Australia.

It said the divestments would allow it to concentrate on developing Couran Cove.