The construction industry has long been a key contributor to the Australian economy. However, in 2023, it appears to face significant challenges, with several major players falling apart and big brands entering liquidation.
One example is Porter Davis Homes Group, which recently announced that it was unable to secure the funding needed to continue operations. As a result, the company has called in liquidators, causing work on its current builds to cease immediately. The liquidators are now working to determine whether a solution can be found to support customers and some of the group’s 470 employees. This news comes on the back of a long list of housing construction industry victims so far this year, including EQ Constructions, LDC, Hallbury Homes, Pantha Homes, Delco Building Group, and more.
One of the primary drivers of this challenging environment is rising costs. This includes everything from materials to labour, with the latter being in short supply across the country. This has led to significant delays in projects and increased costs, which builders are struggling to pass on to customers. Supply chain delays are also impacting the industry due to global shipping issues and a lack of available trucks and other transport vehicles. As a result, builders are struggling to secure the materials they need to complete projects on time and on budget.
Unfortunately, the challenges facing the construction industry show no signs of stopping. Recent ASIC records showed two notices relating to builders, with Cunniffe Construction appointing liquidators and Simply Built announcing a voluntary wind-up.
It’s clear that the construction industry is facing significant challenges in 2023. With major players like Porter Davis Homes Group falling apart and big brands going into liquidation, the industry needs to adapt in order to survive. Whether through more sustainable practices or increased government support, a change needs to be made in order to ensure a sustainable future for the industry.
If you are in the construction industry and are feeling the stresses that come with it, please reach out to our team at Walker Hill for help at support@walkerhill.com.au.
