A shortfall of $8.7 million has been left by the collapse of Wellington construction company Armstrong Downes Commercial, liquidators say.
The Paddington, a $130m project to build 150 terraced houses on Taranaki Street, is being developed by Thames Pacific, whose owner says the project is going forward despite the Armstrong Downes liquidation. Photo: RNZ / Angus Dreaver
The liquidator, Grant Thornton's, first report showed the company has $17.6m in liabilities but only $8.9m in assets.
The company was placed into liquidation on Tuesday and its eight construction sites temporarily closed.
The report said the company's two largest construction projects were suffering major losses as result of fixed price contracts it had entered into prior to the Covid-19 pandemic.
"Since the fixing of price, there have been significant issues and market factors that have adversely affected the company, including substantial cost increases outside of those budgeted for, procurement and supply chain challenges, and labour shortages," it said.
The statement of affairs shows the company owed secure creditors, by way of bank bonds, $2.9m and $14.7m to unsecured creditors.
The company's records indicate there are 320 unsecured trade creditors totalling $9.2m.
"At this stage, it is unknown if there will be any funds available to make payment to unsecured creditors," the report said.
It said most sub-contractors had been able to recover their tools and equipment from construction sites.
No time frame was provided for the liquidation's completion.
Two developers who had contracted ADC to build apartments and townhouses in Lower Hutt and Wellington City have said the homes would be completed.
