What Happened?
In a shocking turn of events, Bensons Property Group (BPG), a major Aussie home builder, has gone into voluntary administration. This means that the construction of 1,337 new homes worth a staggering $1.5 billion is now hanging in the balance.
The Impact
BPG is currently employed to build homes in Victoria, Queensland, and Tasmania. The company’s portfolio includes iconic projects like the $485 million Chevron One residential tower on Queensland’s Gold Coast and Montpelier House in Hobart, featuring 21 luxury residences worth up to $9.28 million each.
What’s Next?
The administrators, Craig Shepard and Sebastian Ham of Korda Mentha, will work with BPG to propose a plan to creditors that will allow the company to continue trading during the administration period. This means that employees, trade creditors, and people who have purchased apartments will be protected, and the $1.5 billion project development pipeline will be delivered.
No Redundancies (For Now)
In a statement, BPG assured that there are no plans for redundancies, and the company has the support of its founder, lenders, and key investors.
But What If…
If a deal with creditors can’t be reached, the unfinished homes and jobs at the company could be in jeopardy. This would be a devastating blow to the hundreds of Australians who have purchased apartments in BPG projects.
The Bigger Picture
The construction industry has been facing significant strains, including the Covid pandemic and rising material costs, which led to the collapse of other Aussie home builders like Porter Davis Homes last year. This highlights the need for companies to adapt to changing market conditions to avoid similar fates.
A Cautionary Tale
One young couple who put $97,000 towards their dream home with Porter Davis Homes were left with just a concrete slab after the company suddenly collapsed. This is a stark reminder of the importance of due diligence and the need for companies to prioritize their customers’ interests.