Probuild collapse: cloud hangs over projects worth $5 billion
Shockwaves have been sent through the construction industry after an Australian building giant went under and tradies downed tools.
The construction industry has been left reeling after one of Australia’s biggest builders collapsed leaving almost $5 billion worth of high profile projects across the country in limbo.
A total of 18 building businesses, including one of Australia’s major construction companies Probuild, have collapsed after their South African parent company pulled all its financial support.
Deloitte has been appointed as administrators to handle the fallout, while 750 employees and thousands of contractors are also impacted, with many locked out of sites across the country.
The Australian arm had 18 major commercial and public sector projects in development, which now have a cloud hanging over them.
These include 13 projects in Victoria, three in New South Wales, one in Queensland and one in Western Australia.
The situation is even more complicated as Probuild is one of only a handful of major builders in Australia that can complete large scale projects.
The fallout has left developers scrambling to find alternatives at a time when the construction industry is facing serious headwinds from skyrocketing prices and Covid-induced delays.
Major sites are now sitting empty as tradies rushed to pull their tools and personal effects on Wednesday, while administrators are seeking out a new owner.
Here are some of the high profile projects left in limbo.
Pharmaceutical giant’s headquarters
The future headquarters of global biotech giant CSL was being undertaken by Probuild, with an 18-storey building in North Melbourne part of stage two of the $1 billion Elizabeth North research and education development at Parkville.
Earlier this month, Probuild issued an update on development, announcing the facade and roof installation was almost complete.
The project was expected to be completed by this year.
CSL headquarters will include nine floors of laboratories and research suites as well as seven office floors.
A CSL spokesman said it would work with Deloitte, Probuild and other stakeholders to mitigate disruption to the “well advanced” project.
“CSL remains focused on completing the building to take occupancy of this landmark facility for the Melbourne biomedical precinct in early 2023,” he said.
UNO Melbourne
The 65 level residential tower was set to deliver 650 homes and Probuild boasted it was the fourth tower it would construct on A’Beckett St.
Early estimates put the development value at more than $400 million.
The Malaysian developer said the tower would feature a private dining area, resident’s lounge, bar, entertainment space and media room and a childcare centre, as well as a yoga studio, therapy room, gym, an outdoor cinema, and a steam room, spa and swimming pool.
Construction commenced in October 2020 and is scheduled to be completed in 2023.
The Ribbon
On the eastern edge of Darling Harbour in Sydney, the $1 billion accommodation and entertainment complex is currently under construction.
It includes the W Sydney hotel across 25 floors, a state-of-the-art IMAX Theatre, retail and entertainment spaces and 10,000sq m of renewed and enhanced public domain.
The project was close to completion before the collapse, according to developer Greaton.
The former MLC centre
Sydney’s former MLC Centre is undergoing a $170 million redevelopment with Probuild announcing it was proud to be a part of the “iconic” project.
It was set to deliver approximately 6000sq m of new and improved retail space across four levels across the exiting space.
While it was due to be finished at the end of 2021, developer Dexus said it was now close to completion with the majority of tenants having moved in.
Caulfield Village
The $300 million Melbourne site, a build to rent project, offering eight buildings with 437 apartments, is understood to have been finished externally but an internal fit-out was underway.
The development was also set to feature an outdoor area, decking and BBQ, pool, spa, sauna and a children’s playground.
However, developer Beck Property Group said the Probuild collapse “does not reflect on the very strong financial position of Beck Property Group or its ability to complete the Caulfield Village project”.
Brisbane's premium subtropical residential tower
The shocking collapse of Probuild reportedly came after this Brisbane high-rise project dragged the company into massive debt.
The 443 Queen St project in Queensland, which involved high-quality apartments, has haemorrhaged as much as $120 million.
The property features 264 luxury residential apartments, but with delays and technical issues it is already well behind its late-2021 completion date.
Originally heralded as Brisbane’s first premium subtropical residential tower, with views across the city, the building’s future now hangs in the balance. The riverfront complex has cost the company’s Queensland arm, PCA QLD, more than $28 million, with sources estimating it could be up to $120 million.
Developer Cbus expected to welcome residents later this year.
West Side Place
Claimed to be one of Victoria’s largest residential developments at 250 Spencer Street, Melbourne, the first stage includes two towers, 1376 apartments and 263 hotel rooms.
The project was also set to boast the tallest hotel in the southern hemisphere – Melbourne’s first Ritz-Carlton hotel at 270m high, Probuild said.
There were reports the build was running behind deadline to be finished this year but developer West Side Place confirmed on its website that “apartments in Towers 1 and 2 are completed and can be inspected immediately”.
Victorian police headquarters
The $650 million office tower in central Melbourne that includes the Victorian police headquarters is located at 311 Spencer Street, and includes Australia’s highest helipad, two suspended sky-bridges and multiple tactical response centres, while the building is powered by 100 per cent renewable energy.
More Coverage
While construction of the building is complete, Probuild is also in charge of the fit-out.
Probuild’s Group Managing Director, Simon Gray, flagged back when it appointed that it was a new move for the company.
“Typically our largest markets have been in retail and residential sectors, however we’ve been preparing to enter large-scale commercial and civic projects by seriously adding to our technical and resource capabilities for a long time now,” he said at the time.
Company with just $3 in the bank collapses
One company had just $3 left in its bank account when it went under, while a business providing services was forced to sack staff after its bill went unpaid.
‘$600bn’: Attack ad claim on nuclear energy
The Albanese government has attached an enormous price tag to the opposition’s nuclear energy proposal in an attack ad targeting the plan.
Shock in $561 million ‘Ponzi scheme’ collapse
A real estate agent has to personally pay back $7.4 million after encouraging a Sydney family’s involvement in a dodgy property investment opportunity.