Yet another Australian builder goes into liquidation
Yet another construction company has collapsed as the building sector continues to weather a perfect storm of labour woes and rising costs.
Porter Davis Homes (PHD) Group, Australia’s 12th largest home builder, has collapsed after the failure of a last-ditch rescue attempt, The Australian reported.
The builder collapsed leaving at least 1,700 homes unfinished across Victoria and Queensland. Grant Thornton Australia were appointed liquidators for 14 PHD Group companies on Friday, according to The Australian.
Grant Thornton said that the causes of PHD’s failure would be investigated, but attributed the collapse to rising costs, supply chain issues, labour shortages and falling demand for new homes.
Grant Thornton’s Matt Byrnes declined to comment on the specifics of PHD’s collapse but highlighted the issues confronting the wider home building industry.
“It’s had rising input costs, it’s had difficulties accessing labour,” Byrnes told The Australian. “...Those builders that do have enough funding and enough capital to trade through the loss-making contracts … they’re looking at the end of that pipeline and seeing a real fall-away in new profitable sales coming in. it’s an issue right across the sector, but ultimately, they got to the point where they just ran out of cash to be able to continue to trade.”
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Byrnes said that Porter Davis had been in talks with “a number of parties” to explore investment in the group or a potential sale.
“At the same time, they ran out of cash to keep funding the business in an ongoing manner,” he said.
Grant Thornton’s appointment is over all PDH Group companies in Victoria and Queensland except Englehart Homes. That company, which was acquired by the group in 2021, is continuing to operate in its own right, The Australian reported.
Work on current PDH building sites would cease immediately, the liquidators said.
PDH Group is the latest in a raft of builders to collapse over the last couple of years – including several that have failed just since January. Earlier this month, national construction company PBS Building collapsed owing an estimated $40 million and leaving 80 projects unfinished. A recent Housing Industry Association report said that 2023 is set to be the construction sector’s worst year in more than a decade.
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