Gold Coast-based construction giant Condev has been forced to appoint a liquidator as market and material costs threaten the company’s bottom line.
The Queensland firm called a last-bid meeting on Monday with developers from around the country in a bid to raise cash for ongoing operations.
The meeting did not provide the solution – thought to be around $25 million – for Condev, forcing founders Steve and Tracy Marais to begin placing the business in voluntary administration.
Despite Condev still being solvent and carrying an excellent reputation, the decision to appoint a liquidator was made due to forecasts that showed market conditions and material costs overwhelming the company’s bottom line.
“We are absolutely devastated for the Condev family of employees, our tradespeople and our affiliates,” Mr Marais said in a statement.
“Unfortunately, we were not able to reach the unanimous support we needed to keep the business operational in the future.”
The Marais’ lawyer, Derek Cronin, of Cronin Miller Lawyers, said plans were being finalised to appoint a liquidator.
“Our clients have considered that the only option open to Condev is to appoint a liquidator to manage Condev’s affairs,” said Mr Cronin.
“Although we are instructed that the company is currently solvent, the decision was made based on forward projections dictated by increasingly challenging market conditions including the exponential rise in material costs.
“This has been extremely stressful for Steve and Tracy who are highly regarded in the industry and the Gold Coast community as tier one corporate citizens.”
Employees and contractors of the company were informed via email last night that the liquidation of Condev was now “a matter of course”.
“It is with the heaviest heart that we advise that we have not been able to achieve the outcome from yesterday’s meeting with developers that we’d hoped and the decision to proceed to the liquidation of Condev Construction is now a matter of course,” the email read.
“It’s heartbreaking to advise that there is no requirement for you to come to work tomorrow.
“We never dreamed this would be possible but we also never dreamed the world would be affected by a coronavirus and price hikes that would put us out of business.
Condev currently has 13 projects under construction across Queensland, employing thousands of workers.
It is the second major construction giant to go under this year, following the collapse of Probuild late last month.