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More than 1,700 home builds have stopped and nearly 800 contracts for builds that had not yet commenced are in the lurch following the collapse of one of Australia’s biggest building companies.
The Porter Davis Homes Group (PDH Group) has gone into liquidation, as at 31 March 2023.
Grant Thornton has been appointed as liquidators of the 14 companies that comprise the Porter Davis Homes Group.
Liquidators will be responsible for all PDH Group operations employing companies across Victoria and Queensland, except for Eaglehart Homes — which, according to Grant Thornton, “was acquired by the group in late 2021”, and is continuing to operate in its own right.
As a result of the liquidation, work on all current builds has ceased, effective immediately.
According to the liquidators, Porter Davis has more than 1,500 homes currently being constructed across Victoria. A further 200 homes are being built in Queensland, while 779 signed contracts are with customers whose builds have yet to commence.
Grant Thornton explained that the liquidators are “working urgently to determine if a solution can be found to support customers and some employees, including by engaging with key stakeholders and potential interested parties who may be willing to take over the current customer contracts.”
While an investigation is underway to uncover the reasons for the collapse, a spokesperson did say that “the extremely challenging environment for residential home building has directly contributed to the PDH Group’s financial position, with rising input costs, supply chain delays, labour shortages, and a drop in demand for new homes in 2023 impacting the group’s liquidity.”
“Notwithstanding the financial support from shareholders and lenders, the group has exhausted options to secure the further funding required to allow Porter Davis to continue to operate viably, and the directors were left with no option but to place the companies into liquidation,” the spokesperson from Grant Thornton continued.
With so many Victorian home owners affected by the liquidation, Consumer Affairs Victoria has released a statement, noting that impacted consumers should lodge their interest with Grant Thornton.
Consumer Affairs advised that impacted consumers may also be able to claim for unfinished or defective work under Porter Davis Homes’ domestic building insurance — also known as builders warranty insurance — which is taken out by builders on works valued at more than $16,000.
Consumer Affairs has highlighted that consumers may wish to lodge a claim with the insurer under which their domestic building insurance is filed.
Acknowledging that the builder’s collapse is “a stressful time for many people who have contracts or unfinished building works with Porter Davis Homes”, Consumer Affairs Victoria said it would monitor the situation closely “to ensure impacted consumers are aware of their options for remedy.”
Fellow construction firm on the brink
Whilst news broke about Porter Davis Homes’ liquidation on Friday, 31 March, another construction company revealed it was on the brink.
The Lloyd Group was placed into voluntary administration on the same day, with work on all current projects halted.
Deloitte, who has been appointed as administrator, revealed it was undertaking an “urgent” assessments of the business’s financial position and project-by-project status.
The ABC had noted that that the Port Melbourne-based builder specialised in infrastructure projects for state and local governments, predominantly across Victoria and NSW.
It highlighted that more than 200 employees and 59 projects were affected by the collapse.
ABOUT THE AUTHOR
Grace Ormsby
Grace is a journalist across Momentum property and investment brands. Grace joined Momentum Media in 2018, bringing with her a Bachelor of Laws and a Bachelor of Communication (Journalism) from the University of Newcastle. She’s passionate about delivering easy to digest information and content relevant to her key audiences and stakeholders.
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