Yet another construction company has gone into administration amid Australia’s deepening building crisis that is leaving dozens of homes unfinished.
Wedgewood Constructions, based in Magill in Adelaide‘s eastern suburbs, was placed into liquidation on Sunday after 14 years in the business.
The South Australian company had specialised in custom-home builds, additions and heritage building works before it collapsed last week.
The development comes just days after the Lloyd Group, a civil design and construction group, went into voluntary administration with about 59 projects still uncompleted, including 30 in NSW and 29 in Victoria on Friday.
Wedgewood Constructions, based in Magill in Adelaide’s eastern suburbs, was placed into liquidation on Sunday after 14 years in the business (pictured, a Sydney building site)
Yet another construction company, Lloyd Group, was placed into voluntary administration on Friday with 59 unfinished projects across New South Wales and Victoria
The news came on the same day housing giant Porter Davis Homes went into liquidation with more than 1,500 projects still to be completed.
Industry leaders have warned the financial crisis will only see the crisis worsen amid repeated interest rate rises and skyrocketing material costs.
Wedgewood liquidator Simon Miller said only four homes were left unfinished, with the family firm only employing a few workers and creditors.
‘It’s a relatively small family business, it had family members working in it, but unfortunately it has gone the way of many of the other builders with high material costs and fixed price contracts – so it has been a very tough game to be in for some time,’ he told The Advertiser.
Across Australia, there were 549 administrations and liquidations in March alone, a jump of 23 per cent when compared to last year.
Just 11 of these companies were based in South Australia with insolvencies relatively low when compared to collapses in the eastern states.
Construction giant, Porter Davis Homes, also went into administration on Friday leaving 1,500 homes unfinished across Melbourne and Brisbane
The construction industry in Australia has seen a rash of insolvencies due to input costs
The Lloyd Group appointed Deloitte Turnaround & Restructuring partners Sam Marsden, Sal Algeri, Jason Tracy and Tim Norman as voluntary administrators of six companies that make up the Lloyd group.
Starting off as a family-owned business from Melbourne’s south-east in 1979, the company has since expanded to employ about 200 people across offices in Geelong, Sydney and Brisbane.
One of the company’s 30 uncompleted jobs in NSW was constructing the Willowdale Sports Pavilion near the growing community of Leppington adjacent to the proposed Western Sydney Airport.
It was also commissioned by Blacktown City Council to construct a sports facility at Schofields in north-west Sydney.
Administrators will urgently assess the company’s finances across its numerous projects to determine its financial situation.
‘From the beginning, our culture of integrity, teamwork, excellence and innovation has been the cornerstone of our business,’ Lloyd Group’s website reads.
Victoria-based Porter Davis, which has been operating for more than 20 years and made $256million in revenue as recently as 2021, also went into liquidation on Friday.
Industry leaders have warned the crisis in the building industry will deepen amid repeated interest rate rises and skyrocketing material costs (pictured, construction in Sydney)
Father-of-two, Sojuy Gosh (pictured), was brought to tears after finding out Porter Davis was placed into administration while his house has been left unfinished
The company is the 13th biggest home builder in the country and constructed 1,734 homes in the 2020-21 financial year.
The company left more than 1,500 homes under construction in Melbourne, another 200 in Queensland and another 779 projects were due to begin soon.
An owner of one of the unfinished houses, Sojuy Gosh, was brought to tears after finding out the company went into administration.
‘With all the time and energy we invested, it’s not something we expected,’ Mr Gosh told A Current Affair.
The father-of-two was told he and his family would be able to move into the home in May last year after giving hundreds of thousands of dollars to Porter Davis.
Construction costs increased at a record-high rate in mid 2022, costing almost 5 per cent more than the previous quarter.
The rate softened in the next quarter however, dropping to just below 2 per cent.