{"id":41533,"date":"2023-01-15T14:47:02","date_gmt":"2023-01-15T01:47:02","guid":{"rendered":"https:\/\/propertynoise.co.nz\/au\/?p=41533"},"modified":"2023-01-15T14:47:32","modified_gmt":"2023-01-15T01:47:32","slug":"second-building-company-collapse-of-2023-points-to-challenging-times-ahead","status":"publish","type":"post","link":"https:\/\/propertynoise.co.nz\/au\/second-building-company-collapse-of-2023-points-to-challenging-times-ahead\/","title":{"rendered":"Second building company collapse of 2023 points to challenging times ahead"},"content":{"rendered":"

PHOTO: Just days into 2023 and the signs of further dark months ahead for the building industry are already evident<\/strong><\/p>\n

REPUBLISHED WITH PERMISSION | API MAGAZINE<\/a><\/p>\n

Less than two weeks into the new year and predictions of further turmoil in the construction industry<\/a> appear well-founded, with the second casualty of year emerging in Queensland.<\/p>\n

LDC Pty Ltd has folded, leaving almost 50 projects facing an uncertain future and creditors owed more than $7 million.<\/p>\n

The luxury high-end builder, specialising in custom architecturally designed homes, was based in\u00a0Rochedale\u00a0in Brisbane\u2019s south.<\/p>\n

\"Building<\/a><\/div>\n
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Falling like dominos: Australia\u2019s construction crisis deepens<\/a><\/h2>\n<\/header>\n<\/div>\n

Employing 45 staff (not all full-time) and formed in 2018, LDC\u2019s demise will affect more than 130 subcontractors and suppliers, LDC shareholders and other parties.<\/p>\n

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Numerous obstacles confront the building and real estate sectors in 2023, according to UDIA president Maxwell Shifman, from potential company collapses to an extended rental crisis.<\/p>\n<\/div>\n

It follows the collapse last week of a Melbourne-based builder of a similar size. Hallbury Homes became the first casualty of 2023, lapsing into administration after 30 years of business, while operating 50 projects on 42 sites in the metropolitan area.<\/p>\n

\"Construction<\/a><\/div>\n
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Construction sector on \u2018brink of collapse\u2019 | WATCH<\/a><\/h2>\n<\/header>\n<\/div>\n

In an exclusive interview with\u00a0API Magazine<\/em>, the Urban Development Institute of Australia\u2019s National President, Maxwell Shifman, said\u00a02023 shaped as a difficult year for the building sector, with \u201cmore building companies expected to go under\u201d.<\/p>\n

Liquidator Bill Karageozis, Managing Director of Mcleods Accounting, took control of LDC on Friday. The LDC company website\u00a0and social media pages are\u00a0no longer active.<\/p>\n

\u201cWe\u2019ve reached out to the Queensland Building and Construction Commission (QBCC) and they\u2019re aware of the company going into liquidation,\u201d Mr Karageozis told media.<\/p>\n

\u201cThey will contact the lot owners who have had partially completed contracts. We will work with the QBCC and make sure they get what they need.\u201d<\/p>\n

\"Pivotal<\/a><\/div>\n
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Construction firm Pivotal Homes COLLAPSES | WATCH<\/a><\/h2>\n<\/header>\n<\/div>\n

\u201cWe are looking into the affairs of the company and see why it went down and try to get as much money as possible for the people who are owed money,\u201d Mr Karageozis said.<\/p>\n

The construction industry has seen a spate of collapses, as rising labour costs, extreme weather, global supply chain issues and materials shortages have hit them hard.<\/p>\n

At least 20 construction companies in Australia folded in 2022.<\/p>\n

\"Condev\"<\/a><\/div>\n
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Second major Australian construction company COLLAPSES<\/a><\/h2>\n<\/header>\n<\/div>\n

Dyldam Developments, Hotondo Homes franchise Tasmanian Constructions, ABD Group, Privium BA Murphy,\u00a0Pindan,\u00a0Oracle Platinum Homes, Pivotal Homes, Inside Out Construction,\u00a0Home Innovation Builders and New Sensation Homes\u00a0have all gone bust recently.<\/p>\n

Clough Group,\u00a0Probuild,\u00a0Snowden Developments, ABG Group and Condev have been some of the other large casualties.<\/p>\n

Tough times ahead for builders<\/strong><\/h2>\n

In further portents of troubled times ahead,\u00a0building approvals have fallen for the third consecutive month. The value of total building approvals fell 1.5 per cent in November, following a 0.4 per cent decrease in October.<\/p>\n

Grant\u00a0Warner, CEO of the Australian Institute of Quantity Surveyors,\u00a0joined the UDIA in saying the stage was set for further building industry collapses in 2023.<\/p>\n

\"Australia's<\/a><\/div>\n
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Thousands in limbo as \u2018orphaned\u2019 homes crisis affects Australia\u2019s building industry<\/a><\/h2>\n<\/header>\n<\/div>\n

\u201cFixed-price contracts that fail to meet inflation and plan for contingencies like Covid, worker shortages and logistics disruptions, are causing construction firms to become unprofitable,\u201d he said.<\/p>\n

\u201cElectricity cost hikes and new building standards are adding further strain to an industry with rapidly shrinking margins.\u201d<\/p>\n

Mr Warner also pointed to construction costs having risen 20 per cent in the financial year 2021-22, while prices of some materials, like timber, rose by more than 40 per cent in a year.<\/p>\n

MOST POPULAR IN NZ<\/span><\/h3>\n