Mahercorp Calls in Administrators Amid Cashflow Crisis

Another 700 home builds are under a cloud following the latest home builder Mahercorp going into voluntary administration on Friday. 

The Urban Developer contacted Mahercorp at the start of April following concerns raised over the viability of the construction company, but they declined to comment. 

Work on the 700 Victorian house build sites is on hiatus while administrators look at whether the business should be restructured. 

The Urban Developer understands the home builder had flagged it would soon become insolvent and appointed voluntary administrators.

Steve Maher is the chief executive of Mahercorp, which he founded in 2002. It is the parent company of 8 Homes and Urbanedge Homes based in Victoria.

In a statement Maher said he hoped to work with administrators to develop a plan for the a restructure of the business. He said the rising labour and materials costs had pushed the builder to the wall. 

“I want to emphasise that Mahercorp has not collapsed and is not in liquidation,” Maher said.

“My intention is to work with the administrator on a plan that I hope allows us to restructure the business, creating a more sustainable footing and to complete your home.”

Mahercorp has informed customers that construction would be suspended for five weeks during the voluntary administration period. 

Cor Cordis has been appointed as administrators for the company.

Home builders continue to be at the thin end of the wedge, facing significant financial pressures.

Speaking at The Urban Developer’s member-only webinar recently Hutchinson’s Builders Paul David said he expected more home builders to fall over in coming months, and his prediction is ringing true. 

David said he expected cashflows to dry up and the “current losses that are residing within the books of builders and subcontractors across the country will start to be realised”.

The domino effect is washing through the home builder market with one of Australia’s biggest builders, Porter Davis, collapsing earlier this month leaving a trail of unfinished homes in its wake. 

The Victorian state government has announced a $15-million reimbursement for more than 500 Porter Davis customers who had lost their deposits as part of the collapse.