The troubles in New Zealand’s construction industry continue, with the announcement that another major building contractor has gone into receivership.
Lara Bennett, John Fisk and Richard Longman from PwC have been appointed receivers to Ebert Construction Limited. This request is apparently a result of a number of poorly performing projects in the Auckland region which have adversely affected the company’s financial performance.
This receivership follows other well-publicised issues in the industry and comes at a time when it is experiencing more and more problems. In particular, delays and cost escalation with projects are major issues as the industry struggles to resource its workload. Disputes appear to be on the increase.
This is both a difficult and crucial period for those affected by the receivership. Owners/developers in the midst of projects and the subcontractors and suppliers working on them will need to make critical decisions over the coming days and weeks about the projects and their involvement in them. These will include:
- the rights to tools, equipment and materials on site;
- figuring out how best to finish projects in a timely and cost effective manner; and
- determining how best to survive given the impact of the receivership on cash flow.
The decisions made now will for some be the difference between going under and survival. For others the decisions made will at least have significant financial consequences.
The specialist construction and insolvency teams at Kensington Swan know what to do in these difficult situations. We have helped a range of owners/developers, subcontractors and suppliers make the right decisions when they have been caught up in other collapses in the industry over the years, including the very significant disruption that the failure of Mainzeal caused. Our team is ready to help anyone affected by the receivership.
The receivership of Ebert otherwise emphasises the importance of industry participants recognising and dealing with risk appropriately when tendering for a project, and acting quickly once any problems arise. Every day we help industry participants to achieve the best possible result with their tenders and problem projects. If you need help with your project, Kensington Swan’s large specialist team has the expertise to assist.