A Sydney-based construction company, owned by a Rich Lister estimated to be worth billions, is looking to expand across Australia by taking over projects from other failed builders.
Roberts Co is investigating taking on commercial projects that were being run by collapsed Victorian builder Lloyd Group as it could potentially pick up the work cheaply, the Australian Financial Review reported.
In March, Lloyd Group, collapsed with 59 projects and 200 staff impacted.
It specialised in building schools and other government infrastructure and had six companies placed into voluntary administration, with Deloitte working urgently to try and rescue the firm and find a buyer.
The construction firm had projects in both Victoria and NSW, including the Willowdale Sports Pavilion in property giant Stockland’s Willowdale community near Leppington and a major sports facility in Schofields in Sydney.
Now Roberts Co reportedly wants to take on six school projects from Lloyd Group, which would be undertaken by Monaco Hickey – a business it acquired from collapsed building giant Probuild last year.
Roberts Co is owned by Andrew Roberts, who previously worked in the family business Multiplex, before launching his business in 2017. He declined to confirm AFR’s report.
Lloyd Group saw 49 of its projects handed back to clients while 10 remained open to negotiation, according to administrators Deloitte.
“The administrators’ primary focus has been on novating project contracts, and this is ongoing,” a spokesman said.
“In the circumstances, this strategy will minimise project disruption as much as possible, preserve subcontractor jobs where possible, and avoid the crystallisation of liabilities.”
Dozens of construction companies have collapsed already this year, including Australia’s twelfth largest home builder Porter Davis Homes, which placed 1700 projects in jeopardy across Victoria and Queensland.
Earlier his month, PBS Building, a multimillion-dollar firm which does a mix of commercial and residential projects across Queensland, NSW and the ACT, sent shockwaves through the industry when it collapsed.
Last month, three prominent building companies collapsed a day apart from each other, with NSW apartment developer EQ Constructions going bust owing up to $50 million, then Perth building company called Hamlen Homes going into administration with $1.4 million reportedly owed to creditors.
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Experts are predicting more construction firms to go under due to rising costs, labour shortages, fixed price contracts and interest rate increases with Equifax figures revealing the struggle in the industry.
Its data showed that 29 per cent construction-related businesses saw their credit rating downgraded in March up from 9 per cent in the same quarter a year earlier.
Razor thin margins in the industry make it hard to reach profitability with Lloyd Group’s most recent financial report showing a pre-tax profit of $3 million on sales of $158.7 million – meaning it made just 1.9 per cent.
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