Founder of collapsed construction firm issues apology, stark warning
The founder of a collapsed Queensland construction firm has issued an apology to employees and clients and a stark warning to other struggling builders.
In an open letter sent to The Courier Mail, Oracle founder Tom Orel said he was “truly sorry” about the building giant’s $14 million collapse in August. He also warned other Queensland builders to exit the business before it was too late.
Orel said he would likely have to declare bankruptcy in the wake of the collapse, The Australian reported.
“Guaranteeing personal assets as security, to allow Oracle to survive as long as it did, has placed me in a very compromised financial position, which is likely to result in me having to declare bankruptcy in my own name,” Orel wrote. “So, no, I am definitely not wealthy.”
Oracle failed in August, leaving 300 homes unfinished across Queensland and New South Wales and owing millions to subcontractors. Orel said the builder would not be returning in any form, appearing to at least partially blame the government and the Queensland Building and Construction Commission for the conditions that led to its collapse.
“Unfortunately, the complexity of challenges facing the building sector, together with a glaring lack of Government support and a seemingly self-governing and curiously-focused regulator (in the QBCC) have, in my opinion, made the building industry one that’s utterly untenable,” he wrote.
“My advice to the builders still battling away: get out before it’s inevitably too late,” he wrote. “Even in the best of climates, residential builders often operate on wafer thin profit margins. So when conditions like those the industry is currently seeing – surging demand for new home builds coupled with unprecedented supply chain issues and crippling labour shortages – flare up, builders are left exposed. As a whole, the cost of building has increased between 8% and 40% over the past year.”
Orel apologised to both Oracle staff and clients for the challenges they faced thanks to the builder’s collapse.
“I’m sorry to all my wonderful staff who were put out of a job on that morning of August 24, 2022; I’m sorry for the undoubted stress that this would have caused you and your families,” he wrote. “I’m sorry to all of our clients [whose] dream homes are now yet another step away. I’m sorry for the stress that Oracle had caused you over the past two years.”
Orel said that since the appointment of administrators on Aug. 24, more than $542,000 has been paid out to satisfy the full salary and leave entitlements for Oracle’s employees.
“Given such, no employee currently has any leave or salary entitlement still owing to them,” he wrote.
