Interested in a Corporate TUD+ Membership?Speak to our team today for a special end-of-year discountSpeak to our team for an end-of-year discount
Resources
Newsletter
Stay up to date and with the latest news, projects, deals and features.
Subscribe
Brisbane’s Aria Group has launched its own construction arm to complete its $50-million apartment project in Brisbane’s Kangaroo Point after the collapse of builder Condev.
The developer has brought on former Condev staff and subcontractors who had been working on its sold-out 12-storey Riviere project under its new arm.
The company, Riviere Constructions, picked up the Condev project team that had been working on the 480 Main Street tower before its collapse.
All of the subcontractors and suppliers working on the tower are back on the job.
Work on the 124-unit Bates Smart-designed development recommenced on March 24, two weeks after Condev’s collapse, but with an actual loss of just five days’ work.
At the time of its liquidation, Condev had 14 projects under way and employed more than 100 staff.
Aria Group development director Brent Liddell told The Urban Developer that they had received a phone call about the collapse on March 12, ahead of the company’s meeting with developers on March 14, giving Aria time to consider its options.
“It seemed more or less obvious that not all the developers were going to come to the table to tip money in,” Liddell said.
“Tim [Forrester, Aria managing director] and I made a decision pretty quickly that we wanted to finish the project ourselves.
“We had that meeting on the Monday and by the Tuesday we had started discussing it with all the staff who were on the job.
“We ended up employing all the Condev staff who had been on the project team.”
Condev was placed in liquidation on March 16.
“It's heartbreaking and bankruptcy is a terrible thing—a lot of people always lose out as a result,” Liddell said.
“It is a very challenging time for the construction and development industry.
“We wish Steve and Tracey Marias [Condev’s owners], their staff and sub-contractors well.
“We are totally committed to completing this project to the very high standards we set, and working with key stakeholders to ensure this happens.”
At the time of the collapse, subcontractors and suppliers had not been paid—Aria Group decided to tip in $2.5 million to cover outstanding payments for February and March.
Liddell said they were happy to make a payment in good faith to prevent subcontractors and suppliers having to go through the liquidation process to get their pay.
“We are not obligated to pay that and it‘s not something we have to pay but it just makes it easier for the subcontractors and the suppliers so that they are not out of pocket,” Liddell said.
“So we just said, ‘let's just pay that and continue on‘.”
Liddell said starting the construction company has “many millions more” in administration and management overheads, among other costs.
Liddell said it made sense to invest in the short term to get the project back on track.
“It's costing us many millions of dollars than we budgeted but for us it is more about our name, our brand and our integrity,” Liddell said.
“We‘ve sold these apartments—we have to deliver.”
Liddell said Aria Group has learned from past experience.
“This isn't the first time we have had a builder go bankrupt in our careers,” he said.
“The last time we went looking for another builder it took us 16 weeks to get back on site.
“So we said ‘you know what, let's keep the whole team together‘.
“You have to pay a little bit upfront to keep everyone happy but for us it‘s an investment, it‘s our integrity and making sure that everyone is not out of pocket.”
Liddell said with six staff on the project team and 20 to 25 subcontractors and suppliers, there was an estimated workforce of up to 300 people directly and indirectly employed by Riviere Constructions.
“There is a spin-off effect of people in the office supporting those on site and all the suppliers who are offsite, and manufacturers,” he said.
There are now up to 60 people on site and that number is expected to increase to between 150 to 200 people as construction progresses.
The original cost estimate for Riviere was around $50 million. It remains on track for completion early in 2023.
Liddell said they had not decided if the construction arm would be kept once Riviere was completed.
He said the main focus was on keeping the staff together.
“We will have to figure that out next year when we complete [the project],” he said.
“The best thing that has come out of all of this is being able to bring all that knowledge and expertise that was there with Condev in-house, and we have been blessed with such a great team of construction experts.
“To have them now internally at Aria and part of the Aria family is just awesome.”
Meanwhile, contractor Roberts Co has taken over several Victorian projects left in limbo after the downfall of Probuild, including SP Setias Uno project in the Melbourne CBD.
Both Far East Consortium’s West Side Place and the Caulfield Village Precinct 2 North have been taken in house by their respective developers.
Engineering firm SRG Global has taken over Probuild's Western Australian arm for $15.2 million.
You are currently experiencing The Urban Developer Plus (TUD+), our premium membership for property professionals. Click here to learn more.
