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Two hundred homes in limbo as SA builder Qattro placed into liquidation

Prospective home owners are in for a nervous wait as the latest collapse of a major builder casts doubt over the future of 200 homes and the government’s ambitious social housing pipeline.

South Australia-based developer Qattro was placed into liquidation on Tuesday, with the company blaming supply chain and labour shortages for causing blowouts to fixed-price construction contracts.

Qattro managing director Bradley Jansen says the business will focus on completing the under-construction homes.

“I am devastated to make this decision after three exceedingly difficult years of efforts trying to recover the post-Covid financial sustainability of the company,” he said.

Mr Jansen apologised for the “significant impact” the closure will have on long-term employees, clients and contractors.

The company directly employs 35 people.

The construction industry has struggled to meet rising costs, despite surging demand for housing.

Fellow South Australian builder Felmeri Homes went into liquidation in May, halting the construction of dozens of houses, while the collapse of Sydney-based developer Toplace and Victorian builder Porter Davis plunged thousands more dwellings into uncertainty.

Because businesses often lock in the price of a contract years before construction is completed, they are vulnerable to sudden cost increases, making projects unprofitable.

“The reality is that selling something under contract for $1 that costs $1.20 to produce can only go on for so long,” Mr Jansen said.

“It is a deeply troubling time for the sector when shortage of housing supply is in lock-step with supply side degradation.”

The Qattro announcement comes at an awkward time for the South Australian government, which needs a healthy construction sector to help deliver its ambitious social housing pipeline.

SA Housing Minister Nick Champion welcomed the passage of the Housing Australia Future Fund on Monday, saying the federal government initiative would help the state fast-track an extra 564 public homes.

While Mr Champion acknowledged the impact inflation, labour pressures and supply chain disruption had on construction, he said the sector was resilient.

“Our government is committed to delivering on affordable housing projects to provide the construction sector with surety and underline a significant pipeline of future works,” he said.

Claims have been triggered for all incomplete projects and for defects on completed works under five years old and therefore still under warranty, Mr Champion said.

The SA Housing Authority has 20 units with Qattro across two sites. No payments have been made over the projects.

Government developer Renewal SA will help find alternative partners to complete unfinished homes.

-AAP
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