20/01/2017 - 13:55

Builton close to collapse

20/01/2017 - 13:55

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UPDATED: Residential construction outfit Builton Group is closing its doors, after staff were told not to come to work on Monday, while an announcement that the company has been placed into administration expected later today or over the weekend.

Builton finance director Laurie Fitzgerald (left) and managing director Troy Felt at the opening of their Burswood office last year.

UPDATED: Residential construction outfit Builton Group is closing its doors, after staff were told not to come to work on Monday, while an announcement that the company has been placed into administration expected later today or over the weekend.

Builton trades under the brands Platinum Homes and Aspireon Homes, and develops apartment projects under the Builton banner, including the under-construction Quattro on Burswood and Greenwich on Bulwer.

Sources suggest the company would have had between 50 and 80 jobs under way at the time of its collapse, mostly apartment product, the Master Builders Association expects around 60 homebuyers to be affected, and creditors are estimated to be owed around $8 million.

The Building Commission is actively investigating Builton over concerns of insolvency, but said it had not yet received notification from the Australian Securities and Investments Commission that the company had gone into administration.

However, a Building Commission spokesperson said the industry regulator would make a public comment later today.

Multiple sub-contractors are understood to have outstanding bills, ranging from $70,000 to $135,000, while a local carpentry company is reportedly close to collapse itself because of an alleged unpaid account by Builton.

The pending collapse comes after Builton moved into a $7 million new corporate headquarters in Burswood early last year, to accommodate its 90 staff.

At the time of Builton’s office move, managing director Troy Felt said he expected 2016 to be a positive year for the company, despite a challenging environment for residential builders.

Master Builders Association WA housing director Jason Robertson said it was always regrettable to hear of a builder going under and into administration.

“However, it would be fair to say that while it’s a sad event, it’s a sobering reminder of economic realities,” Mr Robertson told Business News.

“It’s no secret with the downturn in the market and coming off those record highs, a lot of businesses have and are still struggling to adapt to the current economic conditions.

“But it certainly does highlight the need for potential homebuyers to exercise due diligence in selecting their builder.”

Update: The Building Commission issued a statement this evening confirming it was aware of information circulating regarding the company's solvency.

Building Commissioner Peter Gow said people should be cautious about dealing with the company and should only make payments when the company confirms its financial situation.

“Although the Building Commission has not received formal notification, the builder has contacted us today and advised that he may need to place the company into voluntary administration," Mr Gow said.

“In the event the company does go into external administration, home owners who have entered into a home building work contract with Builtoncorp and have unfinished, faulty or unsatisfactory work should be covered by home indemnity insurance.”

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