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Creditors to Gold Coast building company GCB Constructions were told by administrators today that they will have to wait on the outcome of two legal stoushes totalling $17 million if they are to see any meaningful return on the debts they are owned.
The first meeting of creditors to the company, one of the city's largest builders, was held on the Gold Coast this morning and drew close to 40 creditors, including a handful who attended via an audio link.
The meeting, conducted by administrator David Stimpson of SV Partners, had raised the prospect of a deed of company arrangement being presented to creditors, although how much they will be offered for their debts remains up in the air.
The legal actions relate to two projects including Drift at Main Beach, work on which has lain dormant for most of this year.
The collapse of GCB Constructions, which is led by Trent Clark, has left the fate of hundreds of apartments in limbo with the extent of the company’s debts yet to be publicly revealed.
Among the projects on GCB’s books when it collapsed were the $160 million Amaya high rise at Broadbeach, Rayjon Group’s Vantage View, which is the final stage of the $200 million Vantage project at Benowa, plus Rayjon’s second Vantage project at Burleigh Heads and Steer Developments’ COTE Palm Beach.
Canberra-based Amalgamated Property Group, the developer of Amaya, has since stepped in to take over construction of that project, while the remainder of projects, including work on the Caboolture Private Hospital, are in the hands of their respective developers.
GCB Constructions firsts showed signs of problems after a public dispute with Drift developer GDI Group, headed by Dean Gallagher. GCB Constructions is understood to be seeking $5 million from the Drift developer in its legal stoush while it is also chasing $12 million from Poly Global, developer of the 243-unit Ascot Aurora project in Brisbane.
Today's first creditors' meeting, which banned media from attending, has been described as a quiet affair where creditors have been told investigations into the company are continuing.
However, many creditors left an hour after the meeting had started with little to cheer about. Most declined to comment to Business News Australia on the outcome of the meeting.
One creditor, who spoke on the condition of anonymity, says he has resigned himself to recovering little if any of his debt.
“There’s going to be nothing left for anyone anyway,” the creditor says.
The creditor had been owed about $300,000 for ceiling and partition work on one of GCB’s projects. While he says half of that sum has been paid by the developer, the administration of GCB had left him $150,000 out of pocket.
“It doesn’t make life easy,” he says. “You just have to start again, but that’s the building game for you.”
Stimpson declined to answer questions after today’s meeting but has agreed to respond to questions from Business News Australia via email.
Among the options presented to creditors today were a DOCA that could include an injection of funds by a third party and the sale of company assets.
The second meeting of creditors is scheduled to be held on 30 August, 2023.
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