More than 200 workers at Sydney-headquartered Bathla Group have been stood down as administrators of the embattled property developer seek emergency funds to stave off a company-wide collapse. The insolvency advisory Teneo said on Monday that new short-term funding arrangements would only allow Bathla to continue construction on some of its 45 sites, while all other projects would be suspended, resulting in 213 employees, about 60% of Bathla’s workforce, being stood down. Bathla is a major Sydney-based developer with operations in regional NSW, South Australia, and Victoria.
Thousands of homebuyers were left in the lurch after the developer went into voluntary administration on 25 August, weighed down by $3.4bn in debt, leaving many buyers with partially complete homes. The developer was also behind on its payroll, and many subcontractors are out of pocket. Teneo said its priority was to finish the estimated 2,500 homes already under construction and that refunds for deposits were not possible.
Administrator Stephen Longley confirmed short-term funding from five lenders would allow limited construction for two weeks while longer-term financing is sought. Bathla’s future is complicated by over 40 lenders controlling different assets, relying on private credit markets with higher interest rates and stricter terms. Many developers face rising rates and reduced buyer demand, but Bathla’s troubles likely predate this year’s economic challenges.
If Bathla collapses, construction sites would freeze, impacting the property market and housing targets.
Source: The Guardian
