Descon Group Australia liquidation: unlicensed Waverley Residences developer wants to finish the job
Developers of a stalled Gold Coast unit block say they’ll complete it themselves after its builder went into liquidation. Meanwhile, buyers in the project are considering class action. Here’s why
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Developers of a stalled Southport unit block say they intend to complete the project themselves after its builder went into liquidation - despite not holding a building licence.
Meanwhile, buyers in the Waverley Residences project are considering class action after waiting more than two years for settlement and being pressured to shell out thousands more than they were told at the beginning.
Waverley was being built by Descon Group Australia, which went into court-ordered liquidation amid a flood of debt claims on Wednesday.
The project’s developer Busikon is directed by Descon director Danny Isaac, who is a 50 per cent shareholder with former car salesman Mark Kebblewhite, also the company’s secretary.
Mr Kebblewhite heads up the Busigroup group of companies, which includes Busifund, which has submitted a $130m debt claim with the administrator of relate company Descon Qld.
Property records show Busikon bought the land for the site for $1.75m in February 2020.
The property has two mortgages over it - one to Busifund and another to Sydney business lender Amal.
Mr Kebblewhite contacted buyers of Waverley apartments late on Wednesday, in an email signed by “Danny Isaac and Mark Kebblewhite”, telling them Descon’s liquidation was “unrelated to the Waverley”. The email said Busikon intended to complete the project itself.
“Given how close we are to achieving completion, we feel it is in the interest of all relevant parties that if necessary, we take over the building works,” the email said. “We are confident we have all capabilities to do so without further delays.”
Busikon does not hold a Queensland builder licence.
The Gold Coast Bulletin has contacted Mr Kebblewhite for comment.
Questions for Mr Isaac, also known as Sami Adib, were answered by his lawyer Clint Kanther, who said Waverley was “mostly complete”.
“Our client will be working with the developer and the liquidators to assist in the transition of any matters required to finalise the project,” Mr Kanther said.
On the afternoon of the liquidation, the eight-storey Waverley site was occupied by just a handful contractors – some working and others packing up to leave.
A man in a Descon shirt outside, identifying himself as a manager, said it was “business as usual” for the project, despite the liquidation.
One tradie, packing up to leave for the last time, said his company had stopped and restarted work there “three or four times” after not being paid on time, with his boss eventually demanding full payment upfront before they would complete their contract.
Some suppliers could be seen removing electrical goods including light fittings from the site and some were still working.
Around 60 Waverley buyers were supposed to be living in their apartments by May 2022, but are still waiting after repeated construction delays. More than 20 have registered for a meeting with lawyers next week, where they are expected to vote on whether to proceed with legal action over their contracts.
Letters sent to buyers last year request payments up to 40 per cent higher than initially agreed, or agree to cancel their contract completely and have their deposits refunded.
Buyers were told if they did not accept one of the two options, the project’s funder, Austar Finance, could “take possession of all or some apartments” and resell at higher prices.
The letters said Waverley would be “a material loss” for Busikon and the extra funds requested from buyers would go directly to the financier.
Austar Finance director Edward Sun declined to answer questions but said the lender was “continuing to assess all available options for the completion of the Waverley project as soon as possible”.
One buyer, not wanting to be named, was told they’d have to pay $150,000 on top of their contract price. They refused.
“Apparently a lot of others did pay the variation,” the buyer said.
“If you spread those increases over 20 or 30 apartments - it’s quite a substantial amount of money.”
A statement from SV Partners on Friday said it had secured the Waverley site and it was too early to estimate how much the company owed its creditors.
It said liquidators were “conducting urgent due diligence of the company’s assets and liabilities”.
The liquidation is likely to be complex, as multiple related companies are also in liquidation or administration – all with different administrators – while others remain operational. Related firm Descon Qld, which engaged many of the subcon-tractors for the Waverley, went into voluntary administration shortly before it was due in court for wind-up action last week.
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