Developers blame pandemic lockdown for collapse of six companies

These companies are administrative members who own or manage more than 90 properties worth $65 million.

They include 40 apartments in the group’s Sydney Road project in Brunswick, another 16 in the Banque 88 high-rise on Southbank, a supermarket and two offices in the Chadstone development and a similar property in The Bentleigh Center being developed in Melbourne’s southeast.

These companies were severely affected during the COVID-19 pandemic and [by] Government policies include rent relief measures for tenants.

Director of CBD Development Guo Jing Chen

The latest body blow to the property sector follows the collapse last week of two home builders that left hundreds of homeowners in limbo.

Family-owned Langford Jones Homes went into liquidation leaving 65 homes unfinished, owed 250 creditors more than $10 million, and another Victorian builder, Snowdon Developments, in voluntary administration with 550 unfinished homes and 262 creditors owed $17.8 million. .

Ian Collins, who has run the Evelyn Faye Nutrition store on Bourke Street since 1995, says the city’s recovery is taking longer than it should.

“The worst part is the lack of office workers in the city,” Collins said, speaking alongside Southwick and Opposition Leader Matthew Guy on Thursday. “Daytime shopping is still very low.”

In the public sector, Victorian public servants have been told to work in offices three days a week, but Southwick speculates there is no oversight or enforcement of those directives.

“[Premier] Daniel Andrews has got his head in the sand, and as a result, business is suffering,” said Southwick.

Full-time staff at the Australian Tax Office are expected to go to the office three days a week, while many Australia Post staff have set up a hybrid model. Victoria Police expect employees to go to the office five days “unless there is an agreed flexible work arrangement,” he said.

Chen was the first major developer to blame government actions for his group’s collapse.

Load

The problem is the tip of a broader industry-wide pressure that has put pressure on businesses as big as Metricon Homes and top construction firm Probuild, which went into administration in February.

CBD Group companies are in the hands of administrators Cor Cordis, Barry Wight and Sam Kaso.

The developer’s latest project, the $400 million glass tower on Box Hill, where many of the 517 residences have been sold, is being built on the corner of Whitehorse and Wellington streets.

“The appointment is not expected to have any impact on the development or completion intended by the end of next year. The project is fully funded, as planned and is expected to be completed on time,” Chen said.

“Our construction and fit-out program [is] on schedule. Tower 1 and Tower 2 will be completed on time in the second half of 2023,” he said.

Companies that collapsed included Chenli Pty Ltd, Chen Corporate Holdings Pty Ltd, C&K Group Investments Pty Ltd, CBD Development Group Pty Ltd, CBD Development Holdings Pty Ltd and The Bentleigh Center Pty Ltd.

The city of Melbourne says about 90 per cent of its staff work in offices at some point during the week.

“We look forward to our staff getting back to work from the office, and that’s what we’re seeing – it’s amazing to see people coming together to collaborate,” said the board’s acting chief executive Alison Leighton.

Last week, a pedestrian counter near City Hall found weekday activity was 86.2 percent of pre-pandemic levels.

But pedestrian activity near state government offices is about 60 percent of normal activity.

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