Bathla Group stands down 213 employees in Australia
In Australia, developer Bathla Group, headquartered in Sydney, has stood down 213 employees — about 60% of its workforce. This happened after short-term funding made it possible to continue construction at only some of the company’s 45 sites.
As The Guardian reports, insolvency consultant Teneo said work on all other projects would be suspended. Teneo did not specify which sites were prioritized. Bathla also operates in regional areas of New South Wales, South Australia and Victoria.
Two weeks of funding
Administrator Stephen Longley said short-term funding arrangements with five lenders would allow work to continue at selected sites. According to him, substantial funding still needs to be secured to advance and finally complete all projects already under construction.
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The new arrangements will allow Bathla to operate on a limited basis for another two weeks while long-term funding is sought. The situation is complicated by the fact that more than 40 lenders control different company assets.
Debts and unfinished housing
On August 25, Bathla entered voluntary administration, burdened with debt of $3.4 billion. Thousands of homebuyers were left with partially completed homes. The company had also delayed salary payments, while many subcontractors suffered financial losses.
Teneo said its top priority was completing approximately 2,500 homes where construction had already begun. At the same time, the company is unable to return deposits paid by buyers. Independent real estate economist Cameron Kusher noted that higher interest rates, falling prices for existing homes and tax changes had complicated the market situation, but the problems of insolvent companies usually do not arise suddenly.
