Embattled Sydney property developer Bathla Group will fold by week's end unless it secures additional funding, administrators Teneo warned. Thousands of customers with partially-built homes face uncertainty as the company struggles with unpaid wages and supplier debts.
The potential collapse of Bathla Group leaves thousands of customers with partially-built homes in limbo and highlights significant financial distress within the Australian property development sector.
Administrators for the embattled Sydney property developer Bathla Group have warned that the company will cease operations by the end of the week unless urgent additional funding can be secured. Teneo, an insolvency advisory firm, assumed control of Bathla's operations on August 25 after the construction company entered voluntary administration.
Stephen Longley, Teneo's senior managing director, stated on Monday that the company has no cash available to pay wages or suppliers. He indicated that without a resolution, the business would have no option but to close. Some staff have continued working without pay in the hope that an emergency financial backer can be found.
Teneo's immediate priority is to stabilize operations and work with lenders to support employees and continue project delivery. However, the firm is not in a position to refund deposits paid by homebuyers. The administrators will prioritize Bathla's 45 projects that are already under construction, which are expected to yield between 2,000 and 2,500 new homes.
The New South Wales government has rejected a request for a financial lifeline. Longley noted that lenders' responses have been positive, but a comprehensive solution requires multiple parties to come together quickly. An update on Bathla's future is expected after a meeting with potential creditors on Friday.