Couple’s home in jeopardy as second builder contracted to their project collapses
The Melbourne man couldn’t believe it when he heard the news, just a few months after being pummelled by another devastating announcement.
One unlucky couple have been caught up in the collapse of a major Victorian construction company just a few months after their previous builder also sensationally went into liquidation.
On Friday, news.com.au reported that Australia’s thirteenth largest home builder Porter Davis Homes had collapsed suddenly placing 1700 projects and another 779 empty blocks of land in jeopardy across Victoria and Queensland.
Porter Davis Homes, which employs 470 staff members, appointed liquidators last week after failing to find someone to save the firm.
The news has devastated Melbourne couple Ben Kucenko, 37 and his fiancee Steph, 33, who are among the impacted homeowners.
They signed a building contract in July last year with Porter Davis for a $320,000 home in Thornhill Park, with plans for their empty block of land to turn into a one storey, four-bedroom house.
Now they are unsure of what will happen to their partially-built property, which is just a frame at the moment, and what kind of insurance payout they will be entitled to.
And in a stroke of incredible bad luck, the pair were also involved in the collapse of another major Victorian builder in July last year, Snowdon Developments, which was court-ordered into liquidation and owed a whopping $28.6 million to unsecured creditors.
“Who can you trust to build your house?’ Mr Kucenko said to news.com.au.
“We can’t believe this has happened again,” Mr Kucenko lamented.
“We thought we would build with a reputable builder so we didn’t have to go through the same thing.
“It was kind of a shock to us.”
They first purchased a land-and-build package for their vacant lot in October 2020.
The build was slated to cost $244,000 through Snowdon Developments, with a $12,000 deposit to be paid upfront.
But as the build stalled and their site remained devoid of any construction work, they terminated the contract, just a few weeks before the construction firm did eventually liquidate.
But this time around, they said the collapse of Porter Davis had come completely out of the blue for them.
They came across Porter Davis and had signed within a month of tearing up their contract with Snowdon.
Amid rising costs of materials and the cost of living crisis, the build price with Porter Davis was $76,000 more expensive than their previous package. But they were willing to do so to ensure they had a trustworthy builder.
Hearing about their bad experience with Snowdon Developments, the team at Porter Davis even agreed to waive their deposit, which further emboldened them that the company was solvent.
But now, 2.5 years later, their build is still not complete thanks to this series of unfortunate events.
In December last year, construction began on Mr Kucenko’s site.
Port Davis made rapid progress in four months.
At time of publication, they were up to the frame stage.
Luckily the pair opted for a steel frame, which means that it is unlikely to rot while they sort out a new builder and while it likely sits untouched for months.
“The one good thing we’ve got going for us (is) we decided we weren’t going to build this house out of timber, it’s made out of steel,” he explained. “At least we know our house is going to be okay.”
He’s worried about looters or disgruntled tradies going on his site taking back their tools or stealing equipment to make up for their losses.
There have been reports of damage and looting taking place at some Porter Davis homes over the weekend.
As a result, Mr Kucenko immediately removed Porter Davis signage on his lot when he heard the news the company had collapsed.
He also rang up the temporary fence company to keep his land protected and will begin paying for the fencing to remain out of his own pocket.
He plans to claim the cost back on insurance.
Insolvency firm Grant Thornton has been appointed to 14 companies under the Melbourne-based group Porter Davis.
“The liquidators will not be trading the PDH Group companies and works on current builds will cease immediately,” Grant Thornton said in a statement.
“The liquidators are working urgently to determine if a solution can be found to support customers and some employees, including by engaging with key stakeholders and potential interested parties who may be willing to take over the current customer contracts.”
The major Victorian builder is the latest casualty in the construction industry that has been hammered by rising material prices, supply chain issues and a shortage of workers.
So far this year, around a dozen builders have collapsed.
Last month, PBS Building, a multimillion-dollar firm which does a mix of commercial and residential projects across Queensland, NSW and the ACT, sent shockwaves through the industry when it collapsed.
From the preliminary investigation, there are more than 1000 secured and unsecured creditors who are owed more than $25 million.
In February, three prominent building companies collapsed a day apart from each other, with NSW apartment developer EQ Constructions going bust owing up to $50 million, then Perth building company called Hamlen Homes going into administration with $1.4 million reportedly owed to creditors.
The next day Melbourne-based residential builder Hallbury Homes also went into voluntary administration.
Earlier in February, award-winning residential construction company Delco Building Group in Victoria went under owing $780,000 to 50 creditors.
There were also two more companies that failed in March – Queensland-based National Construction Management which went into liquidation this month while Allworks Building Pty Ltd, a NSW company went under too.
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NSW based building company Ajit Constructions was also ordered into liquidation by the Supreme Court of NSW after an application by one of its trade creditors Boral Resources NSW.
alex.turner-cohen@news.com.au
– With Sarah Sharples
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