Sunshine Coast building company Pivotal Homes goes into liquidation

One of Queensland’s biggest home builders is in liquidation, leaving the future uncertain for more than 200 new home builds and 16 staff.

One of Queensland’s biggest home builders has gone into liquidation, leaving the future uncertain for more than 200 new home builds in the state’s south-east.

Sunshine Coast building company Pivotal Homes, once a sponsor of the Gold Coast Titans, went into liquidation late on Thursday.

Managing director Michael Irwin said rising labour and construction costs had strangled the business.

“In my 30 years’ experience I have never seen a set of circumstances like this and obviously we are not alone in these unfortunate conditions facing the industry,” he told the Courier Mail.

“We are absolutely devastated for our 16 Pivotal Homes employees and assure all creditors, contractors and subcontractors have been paid in full.

“All purchasers are in a net gain position, meaning the work they have paid for has been completed. In fact, they have had more work completed on their homes than they have paid for.”

Derek Cronin of Cronin Miller Litigation, who was speaking on behalf of Pivotal Homes, said liquidation was the only option left for the company after hitting dire straits.

“The decision for Pivotal Homes to go into liquidation has been based on forward projections dictated by the increasingly challenging market conditions, including the exponential rise in material costs,” he said.

“It is an unfortunate set of circumstances that is impacting on the industry across Australia.”

One of Queensland’s biggest home builders is in liquidation, leaving the future uncertain for more than 200 new home builds and 16 staff.

The construction industry has been badly hit by collapses this year.

Two major Australian construction companies including Gold Coast-based Condev and industry giant Probuild have already gone into liquidation this year.

Smaller operators like Hotondo Homes Hobart and Perth firms Home Innovation Builders and New Sensation Homes, as well as Sydney-based firm Next have also collapsed, leaving homeowners out of pocket and with unfinished houses.

An industry insider told news.com.au earlier this year that half of Australia’s building companies are on the brink of collapse as they trade insolvent, and it could see thousands of people’s homes impacted in the coming months.

Operators in other industries have also fallen over.

Send, a company that promised to deliver groceries in under 15 minutes, collapsed earlier this month putting the jobs of 300 staff in Sydney and Melbourne at risk.

The decision for Pivotal Homes to go into liquidation has been based on forward projections dictated by the increasingly challenging market conditions, including the exponential rise in material costs.

Australian investment company REMI Capital was also placed into voluntary administration on Wednesday.

Mark Prestige, who had been managing partner at REMI Capital for close to four years, acknowledged there had been a “lack of communication” from the company in recent weeks.

“Remi had been advised by external legal counsel not to communicate over recent weeks until the modelling was complete that allowed this difficult decision to be made,” he wrote in an email addressed to investors, shareholders and ex-staff members.

“REMI apologises for any lack of communication in recent weeks. We ask you rely on any reports to creditors and not rely on any speculation you may hear.”

Its property portfolio spanned a range of areas in Melbourne including projects in the suburbs of Tarneit, Rockbank, Sunshine, Pakenham, Laverton and Sunbury.

Chris Baskerville from specialist insolvency and business recovery firm Jirsch Sutherland has been appointed as administrator.

He said it was too early to tell what had happened, with his firm currently undertaking urgent investigations to map out where the $70 million has gone.

“We are undertaking an urgent financial assessment and working closely with the directors to try to find a solution and provide the best outcome for investors and creditors,” he said.

“One of these solutions is likely to be a Deed of Company Arrangement (DoCA) proposed by the directors.”