New South Wales-based home builder Beechwood Homes moved into voluntary administration and receivership yesterday, with hundreds of creditors owed up to $20 million in unpaid debts.
Beechwood, owned by entrepreneur and thoroughbreed horse breeding enthusiast Larry King, was one the state’s biggest home builders.
After Beechwood announced it had moved into voluntary administration its biggest largest creditor, BankWest, called in the receivers in order to protect its $10 million debt interest.
Potentially hundreds of unsecured trade creditors will be left to compete for their share of the remaining amounts uncovered by administrators.
Beechwood has reportedly grown strongly in recent years but had also come in for some criticism, with 119 complaints lodged with the NSW Office of Fair Trading against the company.
The biggest losers from the collapse could be the 700 or more people who have provided deposits or advanced payments for construction with Beechwood, The Sydney Morning Herald reports.
Many will be able to claim some compensation under a compulsory insurance scheme, but payments under that scheme are limited to $300,000 for incomplete work.