Rival builders Descon Group and Groupline Constructions fill gap after Condev collapse

The carve up of Gold Coast building projects that were left in the lurch after Condev Constructions was placed in liquidation.

Condev building site at Cannes Waterfront, Surfers Paradise. Picture: Nigel Hallett

Builders are stepping in to take over deserted projects on the Gold Coast that were left in the lurch as a result of Condev Constructions going into liquidation last week.

At least three projects have been picked up as the market – which has seen a plethora of apartment schemes launched in recent years – deals with the shock of a legacy builder ­collapsing.

A relative newcomer to the Gold Coast, Descon, has taken over the sites of Macquarie York’s Allure tower at Chevron Island and SGP Land’s Brooke Residences at Robina, which are each past the midway point in construction.

Artist impression of Allure at Chevron Island. Picture: Supplied

Descon founder Danny Isaac said the business was brought in through project management company Eastview Australia, which was already involved in both sites. Condev staff were being retained to complete the projects.

“We believe that there will be very minimal impact to delivery time frames,” he said. “It was a very rapid response from Eastview, which allowed a rapid response from us. It was a great recovery.”

Spyre director Daniel Laruccia said the developer was blindsided by the Condev announcement, finding out from an onsite contractor at their Natura project at Burleigh Heads on the Saturday before the official revelation on March 14.

They quickly moved to secure their subcontractors and have already appointed Groupline Constructions to take over the estimated 12 weeks remaining of the build.

Mr Laruccia said buyers who bought into the project had been “incredibly supportive”, with many making significant gains on the prices they locked in before Covid due to the strong price growth generated over the past two years from pandemic seachangers and interstate migration.

Artist impression of Spyre Group's $77m Natura Project at Burleigh Heads. Picture: Supplied

The sentiment was backed by Matt Schneider, chair of the Property Council’s Gold Coast Committee, who is confident the market isn’t about to bust following this recent boom cycle. In the final quarter of 2021, a record 651 new units were sold, capping off an incredibly strong year for sales.

“We can’t foresee a situation where we have a sharp downturn because of the strong fundamentals on a medium or long-term basis,” Mr Schneider said.

However, more pain is expected, with at least two other builders expected to collapse this financial year. It reflects rapidly rising supply and labour costs in a booming market, which has blown out projected costs contracted some time ago, placing stress on many builders’ already tight profit margins.

Scott Hutchinson, chairman of generational family business Hutchinson Builders, said the builder was not chasing work but was “open to helping out” on the Gold Coast, given the circumstances.

He likened the current environment to that of 2003, when several builders failed as a result of a construction and housing boom.

Mr Isaac said developers had to be cautious when appointing builders in such a turbulent market.

“In a nutshell, it’s about the selection of the builder … this will happen again, unfortunately,” he said. “If you don’t have a builder that can weather the storm, you leave room for error.”