David Reid Homes South Auckland franchise collapses
A building company has gone into liquidation owing nearly $1.6 million, as the downturn in the housing market continues to go downhill.
Pukekohe-based BSB Construction, a franchise of David Reid Homes, has been declared insolvent, one of many businesses that have become extinct in the last couple of months.
The company owes a total of $1.74 million, with only $174,000 in assets, leaving its creditors about $1.58 million out of pocket.
A liquidators report hints that BSB Construction was in trouble for some time before the building slump finally sounded the death knell.
“Unfortunately, it appears that the company built and sold homes with insufficient margins to cover its operating overheads,” says the report.
“While attempts to rectify this situation were made, conditions in the home market have made it impossible for the company to trade.”
Creditors have until December 19 to lodge a claim for money owed.
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Comments and questions1
Don't blame the recession! Too many builders don't know how to manage money. They're either greedy or incompetent. The losses are carried by the innocent homebuyer, the suppliers and the subbies. Don't let them handle money. Ring fence the funds for each project and show some accounatability. They're eroding our GDP. Something needs to be done - trust, a Govet fund, escrow - whatever it takes!