Latest news with #buildingdefects
Daily Mail
10-06-2025
- Business
- Daily Mail
Aussie home builder collapses after being swamped with more than $12million worth of customer claims over alleged building defects
A Sydney construction firm has gone into voluntary administration following mounting pressure arising from $12.9million in building defect claims. Family-run J & CG Constructions has been in operation since 1994 and built apartment complexes, offices and commercial spaces until the company was placed into administration in May. According to documents filed with ASIC, Sean Wengel and Rashnyl Prasad of William Buck have been appointed as joint administrators. The ASIC filing follows legal action in both the NSW Supreme Court and the NSW Civil and Administrative Tribunal (NCAT). In total $14.9million is owed to creditors, with the vast majority tied to construction defect claims. Company director Mark Guerreiro said the business was unable to survive the financial burden, the administrators wrote in their report. 'The director considered that the scale of the claims, along with the legal costs expected to defend them, exceeded the company's financial capacity and rendered the business no longer viable,' the report stated. The largest claim stems from the Rising Apartments development on Botany Road in Mascot, a 44-unit complex completed in 2017. Owners at the Mascot building allege defects collectively worth $11.9 million, with an independent 2019 inspection uncovering 'potentially major defects related to the rooftop waterproofing' along with several minor issues. That matter remains before the NSW Supreme Court. A second legal action was launched in December by owners of a 15-apartment and two-commercial-lot property on Norton Street in Leichardt, who are seeking $606,820 in compensation for alleged construction faults identified in 2023. Administrators say more defect claims are under review, and the final total could increase as complex matters are resolved. J & CG Constructions had stopped taking on new projects in the 2024–2025 financial year, choosing instead to focus on existing contracts and warranty-related claims. Despite these efforts, the business saw its income plummet, from $15.4 million in FY2023 to just $581,000 in FY2025. It also faced a string of financial setbacks, including a $550,000 hit from SafeWork fines and legal costs, and an additional $250,000 loss from invoice fraud. In FY2025 alone, the company recorded a $704,000 loss, following a $1.9 million loss the year prior. Administrators noted that the company's continued operations had been propped up by Mr Guerreiro personally funding its working capital. 'The company remained able to trade and meet obligations prior to this period only because the director personally funded working capital needs,' the report said. However, the looming $11.9million claim from the Mascot development 'would place the company into an insolvent position he could no longer support,' the report concluded. Mr Guerreiro was also listed as a director of related entities J & CG Con, J & CG Group, and J & CG Fitouts. Administrator are pursuing a deed of company arrangement rather than liquidation which would see Mr Guerreiro put in $100,000 of his own money and creditors would receive 0,68 cents to the dollar.
ABC News
09-05-2025
- Business
- ABC News
NSW Building Commissioner to oversee repair of hundreds of defective homes in Shell Cove
The NSW building regulator will oversee the repair of hundreds of homes in a new housing estate after describing their defects as "shocking". Building issues, mostly related to waterproofing, have been identified in 325 of the 354 homes at the Shell Cove Marina, in the NSW Illawarra region, since 2019. The multi-million-dollar residential development is part of a joint venture between Singapore-based developer Frasers Property and Shellharbour City Council. It is unclear how many homes have already been repaired. Building operations executive director Matt Press said the arrangement with Frasers Property was the first voluntary undertaking related to class one, or free-standing homes, since the commission was granted extra powers. "Undertakings are a relatively new tool in our regulatory toolkit," he said. Shellharbour Mayor Chris Homer said Frasers Property may have "dropped the ball" in addressing all home repairs, but Mr Press said it was time for an added level of governance. Mr Press said the arrangement would be "better for everyone". "I think it's been challenging for the developer … basically every owner is an individual party to this. So, it really needed the support of the building commission to bring all the parties together," he said. Mr Press said Frasers would hire the undertakings manager but they would "act on behalf of the commission", ensuring repairs were compliant and timely. Affected residents can opt in to the undertaking, but home owner Chris Maude said the ongoing situation had battered the community's trust. "I've lost a lot of respect for how Frasers has approached this, just with the lack of care with some of the finishings and how they have gone about some of the work," he said. Mr Maude said Frasers Property tried several times to fix waterproofing issues at his home, causing him to take time off work and "mental strain". "Some of the work that had been done required a structural engineer to come and assess the work after there was some damage that happened as a result of them doing the work," he said. Despite her home being covered in scaffolding for four months, Robyn Parkinson was pleased with repairs to mould and water ingress at her home. "They rebuilt our balcony. They did a whole lot of work on the roof … and replaced the timber pergola," she said. She has since downsized and had to supply a scope of works reports to aid the concerns of the new buyer. "The thing with all of this is it should never have happened in the first place," she said. Frasers Property said in a statement its "absolute priority" was to continue to complete the rectification works program for customers. Shell Cove has served as a significant income stream for the council over the past 30 years, but Cr Homer said the project's completion may result in a budget deficit. "There is projected to be a budget deficit. I mean, whether that's seen as something as a real negative [is unclear]," he said. "But at the end of the day, the money there will be invested for the good of the ratepayers of this city." Cr Homer said he hoped the voluntary undertaking would help end ongoing structural issues for Shell Cove home owners. "It's huge, it can be risky. But the payoff is huge as well, I mean, we have a beautiful marina."
