Pivotal Homes owes more than $16m to unsecured creditors, still unpaid a year after liquidation

The amount of money owed by a collapsed Gold Coast home builder has swelled to more than $16m – more than four times what the director initially estimated.

The amount of money owed by a collapsed Gold Coast home builder has swelled to more than $16m – more than four times what the director initially estimated.

Pivotal Homes went into liquidation on May 26 last year, leaving more than 100 homes unfinished and scores of subcontractors out of pocket.

A report from director Michael Irwin at the start of the liquidation estimated Pivotal had debts of $3.6m.

The day he announced his company had failed, Mr Irwin blamed “gouging” subbies and suppliers for the situation.

A year later, not a single dollar has been repaid to unsecured creditors.

Pivotal Homes subcontractors are still millions of dollars out of pocket.

In his latest report to creditors, liquidator Chris Cook of Worrells said staff entitlements had been paid and he expected unsecured creditors to receive as little as 4.42 cents for every dollar owed.

The report said he was pursuing a potential “negligence claim” and there was still $2.7m “to be collected” from marketing agents, paid by Pivotal to find new work.

Mr Cook said $2.5m had been recovered from bank accounts, tax refunds, payments from homeowners and other sources.

Legal fees of $195,288 had been paid, chiefly to Cronin Miller Litigation, while the liquidators had been paid $691,359.

Tara Ferguson, Brodie Lehner and Cameron Leworthy 9 and Kayliegh Lehner had nowhere to live after the collapse of Pivotal Homes. Picture: Richard Gosling

Mr Cook had earlier found Pivotal Homes did not hold enough assets, required under its Queensland builder licence, to perform the amount of work it was undertaking.

Pivotal’s licence history showed it had a maximum revenue limit of $30m but logged 211 residential construction jobs worth $56.7m in 2020-21.

It logged 105 jobs worth $30.5m before it failed in 2021-22.

Mr Cook also found the company had paid $2.9m to sales agents in exchange for finding new Pivotal clients.

Pivotal Homes Managing Director Michael Irwin and Lawyer Derek Cronin announced the demise of Pivotal at a media briefing. Picture: Richard Gosling

A Ferrari, listed as a company asset in its depreciation schedule, had been sold with proceeds being paid to the company, the liquidator said.

The liquidator shed more light on a ransomware attack, which was described as the “last straw” that pushed Pivotal into liquidation.

The report said hackers gained access to the company’s network on May 10, two weeks before the liquidation, destroying six months worth of financial records, and that a backup system failed.

Mr Cook said the lost files had meant staff of Pivotal had been attempting to settle accounts manually, with the increased labour a likely contributor to the company’s failure.