Construction business Procorp collapses into administration with more than 500 creditors
The NSW building industry has taken another victim. Residential homes builder Procorp, one of the largest companies of its kind in the state, has been placed in administration.
The disappointing news, which puts 50 jobs in jeopardy, comes despite some relatively positive recent developments in the construction industry. Building approvals and finance have both increased in the past month.
The company counts over 500 creditors, with 90 homes under construction and 50 with plans still yet to commence.
Hall Chadwick administrator Domenic Calabretta told SmartCompany this morning a creditors' meeting will be set for next Friday, but that the administrators are still investigating.
However, he did say it's clear how the trouble began.
"Cashflow dried up," he says. "We're talking to new and incoming builders about the completed homes, and we're just working through our processes right now."
"The obvious factor here is the weaker housing market."
Richard Albarran and Brent Kijurina have also been appointed to the case. In a statement, the team said it will be conducting "an urgent assessment of the business".
"The administrators have also been in contact with the NSW Self Insurance Corporation in relation to home warranty insurance claims and will be in discussions with other builders in relation to the continuation of building works as soon as possible."
Procorp is one of the largest building companies in New South Wales, counting over 500 creditors. Mick Everard started the business 12 years ago, having worked in the stock and station industry in regional Australia.
On its website, the company claims to draw on a "broad base of experience and knowledge". The company's supposed strength is its one-stop-shop solution: the company handles every part of the building and construction process.
The collapse comes after the New South Wales economy has already witnessed a shocking number of construction collapses – so many that the state government began an inquiry into the trend.
The collapse of Reed Constructions, and Kell and Rigby, were two major catalysts for the establishment of the inquiry.