Administrators, developers comb through Roberts Co wreckage

The Victorian company had a fourth, unidentified, project and its sister Monaco Hickey business had four smaller jobs such as school extension projects, industry sources told The Australian Financial Review.

Separately, a further 16-18 completed projects were still in their statutory warranty period, meaning the collapsed company was liable for any defects that could arise, the sources said.

The decision to put Roberts Co VIC into administration – foreshadowed by the Financial Review on Friday – is the latest blow to a commercial construction sector that has struggled for two years, locked between soaring costs and fixed-price contracts.

Total construction insolvencies for the financial year to date of 2215 are up by 20 per cent on the 1839 clocked up in the same period last year, figures from corporate regulator ASIC show. Victoria accounts for 661, or 30 per cent of the total so far this year – with more than three months to go – up on the 26 per cent, or 772 of last year’s total.

The Roberts Co VIC collapse poses a risk to subcontractors already working off razor-thin margins.

“We’d been chasing them for two weeks,” one unpaid subcontractor, who declined to be identified, told the Financial Review over the weekend.

“They were so regular and all of a sudden they’ve stopped.”

The subcontractor first heard rumours that the company was on shaky ground on Wednesday and on Friday told their staff to start removing equipment. The Financial Review on Friday photographed large numbers of workers removing equipment from the Amazon site in Melbourne’s outer north.

The total debts owed by Roberts Co VIC were not clear over the weekend and McGrathNicol administrators Jason Ireland and Matthew Caddy declined to comment.

But Amazon and logistics giant ESR – developer of the four-level, 209,000-square-metre, robotic distribution facility for businessman Jeff Bezos’ company – will likely be on the hook for more money to finish the project that sources said was more than half built.

The anticipated construction cost of the Amazon warehouse has not been disclosed but one warehouse contractor estimated the so-called base build to be about $400 million and automation costs at a further $400 million.

Developer ESR said on Sunday it intended to get the project complete.

“ESR is committed to continuing the project and liaising with the administrators to work through next steps,” a spokesperson said.

Amazon did not respond to a request for comment.

The fastest way to restart work on the project – Roberts Co VIC projects were closed by the administrators after their appointment late on Friday – would be for all parties to agree for Roberts Co VIC staff to keep working on it for the developer and administrator.

“Realistically it would take at least one week to get everyone to assess their positions and contractual documents need to be in place,” a source with knowledge of the administration process said.

“That’s if everyone wants that to occur.”

Ironically, the two projects that crippled Roberts Co VIC – and which the company took over when it acquired the assets of collapsed builder Probuild in 2022 – are closer to completion and will likely cost their developers less.

The $450 million, three-tower, Footscray project, due for completion in the September quarter, has completed its structural work and is now up to the finishing trades, such as plastering and electrical work.

“Investa, on behalf of owner Oxford Properties Group, is very concerned by the Roberts Co administration,” a spokesperson said on Sunday. “We will collaborate closely with the appointed administrator to identify a path to ensure completion of the Footscray project.”