Roberts Co owes Victorian tradies $50m
Roberts Co’s Victorian arm went into administration owing more than 100 trade creditors up to $50 million in debts – mostly current progress claims – creditors heard in their first meeting with administrators on Wednesday.
Total liabilities went up to about $186 million if obligations to all bond holders and contingent claims for liquidated damages due to delays were included, but such a scenario was less likely, sources present at the meeting told The Australian Financial Review.
How long it would take to restart work on the contractors’ three main Melbourne projects – and how they would be completed – remained unanswered, however, administrator Jason Ireland told the Financial Review after the meeting chaired by his colleague Matthew Caddy.
The quickest option would be for the administrator to step in as project manager, overseeing progress and payments from developers to subcontractors already engaged on the jobs, but it was unclear what the clients would choose, Ireland said.
“We’ve presented to each of them the option that involves us, which is fastest to start again, but they may just say ‘I’ll start later with someone new’,” he said.
Projects needed to start quickly to ensure trades and other suppliers – and their employees, who might be looking for other jobs – remained available to the jobs, he said.
“If they’re going down the restart path with us it needs to be weeks,” Ireland said.
Meanwhile, the sites at Craigieburn in Melbourne’s outer north of retailer Amazon’s biggest warehouse in Australia, as well as the 702-unit build-to-rent apartment development in inner-western Footscray and a 28-storey office tower on Little Collins Street in the CBD all remain closed.
“ESR is working with the administrators and other project stakeholders to get the site back up and running as soon as possible,” the developer of the 209,000-square-metre Amazon warehouse told The Australian Financial Review.
“It is a highly complex project; as such, we are working to ensure we have the appropriate partners on board to resume work.”
A spokeswoman for Investa, which is developing the build-to-rent project with Canada’s Oxford Properties, said their site was still closed.
Golden Age, developer of the 28-level 130 Little Collins Street strata office tower, did not respond to a request for comment.
Roberts Co Australia, which had already lost more than $60 million from its Victorian projects before calling time on the subsidiary, declined to comment on Wednesday.
Separate documents filed by the administrators with corporate regulator ASIC show Roberts Co owner, billionaire Andrew Roberts, first raised concerns with them about the cashflow challenges of his Victorian subsidiary on February 18, more than three weeks before a formal appointment to take over the troubled business.
Roberts’ lawyer contacted McGrathNicol partner Ireland and a series of meetings followed, leading to contingency planning around putting the company into administration starting on March 7, the documents show.
National Australia Bank was a secured creditor over Roberts Co VIC’s assets, the administrators’ documents also showed.
The administrators were paid $110,000 for that work on March 10, before the formal appointment on March 14. And as of last week, the administrators had received a total $4.9 million, their disclosure documents show.
The collapse of the Victorian business, which had contracts with a collective construction cost totalling an estimated $930 million, poses a threat to the continued existence of the parent company.
If all clients called in security bonds lodged against their projects by the builder, it could mount to demands for some $46 million, more than the contract assets Roberts Co Australia said it had in its last published earnings for the year to June 2024.
