Collapse to sting subbies, with more pain ahead

A key player in the Sunshine Coast construction industry says more pain is likely to come for builders and subbies as the fallout of the RGD Group continues.

RGD buildings.RGD office

MASTER Builders Association Sunshine Coast regional manager Will Wilson says more pain is likely for builders and subbies across the region, as the fallout of the RGD Group collapse continues.

The long-time Coast construction firm RGD Group Pty Ltd and RGD Constructions Pty Ltd entered voluntary administration, appointing FTI Consulting late last week.

The shockwaves of the collapse are being felt by subbies across the region and beyond.

Mr Wilson said the collapse would cause "a lot of pain" to subcontractors.

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"Having one of our homegrown major construction companies fall off is going to have a major impact," he said.

Mr Wilson said RGD Group, directed by Ron Grabbe, had been a "major contributor to the Coast" and said thousands of people had been employed on their jobs over the years.

Master Builders Sunshine Coast and Burnett Wide Bay Regional Manager Will Wilson

Mr Wilson said the current coronavirus pandemic was having a significant effect on the industry and he expected it would continue.

"The pipeline is drying," he said.

"The inquiry isn't there (both residential and commercial) … the confidence isn't there.

"None of us know where we're going to end up with this."

Mr Wilson said he expected subbies to feel more pain with low cashflow and tight margins which would only be squeezed further in a bid to ride out the storm.

He said anyone who didn't have a good pipeline of work, an "exceptional set of finances", and a "pretty decent sprinkling of fortune" would struggle to get through the period.

Mr Wilson said his organisation was pushing hard for stimulus packages for the industry, with fears the worst of the impact wouldn't be felt in the sector until after the current government stimulus measures had stopped.

Ron Grabbe and Klint Grabbe of RGD Group have purchased an oceanfront site on the corner of Bokarina Boulevard and Longboard Parade at the new Bokarina Beach for a luxurious $70million beachfront residential and retail development.

He said the March building approval numbers had dropped significantly, and he expected approval numbers in June to be "dire", with many concerned about where their next work was coming from.

Some of the stimulus being sought included an increase of the new home grant to $40,000, and not limiting it to first homeowners in the interim.

A household improvement package was also being sought, to try and keep smaller operators in work, while there was also a push for funded projects to be accelerated.

Mr Wilson said the impacts of the pandemic would affect both ends of the industry too, with experienced tradies considering retirement likely to exit the industry, while others would be hesitant to put apprentices on if they weren't confident of guaranteeing four years' work.

He said Sunshine Coast apprentice numbers were already down compared to the rest of the state and country.

RGD buildings.The Rhythm on Beach, Maroochydore

 

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