Building contractor withdraws from The Linden development at Sutherland

A partly-completed apartment complex at Sutherland is further evidence of the tightening finance squeeze that is hitting home builders and buyers.

The Linden, which is being built in Linden Street by Quantum Group, comprises 62 units over six levels in two blocks.

Work stopped in July, 2018 when money ran out, and is yet to recommence.

Building contractor Lords Group withdrew from the project in late January.

Lords Group says it is owed “a significant amount of money” and saw nothing that formally confirmed new finance had been approved.

Quantum Group says finance to complete the development was approved late last year and it is in the process of engaging a new builder.

 About 55 per cent of apartments have been sold off the plan.

Quantum Group managing director Peter Gribble said the delay in completing the development was “very disappointing”, but the project was “quite doable”.

“It was due to finish late this year, ideally in the late third quarter or in the fourth quarter,” he said.

“Our expectation now is possibly the fourth quarter of this year but more likely the first quarter of next year.”

Mr Gribble said a report would be sent to buyers in about a fortnight.

“Finance has been very difficult in this environment with the banking royal commission and general marketing,” he said.

“We had finance approved late last year.

“We were working to get the builder to restart the site and they gave every indication that would occur in November-December.

“We were negotiating some of the documents to get them back on site and, for some reason, they wouldn’t sign the documents and restart the project.

“In late January we heard they didn’t want to proceed with the project and they have been removing their equipment from the site.

“We are starting to engage with a new builder to restart the project and are very close to finalising that.”

Mr Gribble said Qantum Group had been involved in up to 25 projects up and down the eastern seaboard.

“We have just completed The Adelong project in President Avenue, Sutherland,” he said.

“I think all the buyers were extremely happy and the [bank] valuations were extremely high.”

Lords Group director Jad Maroun said the developer had been trying to get finance for seven months.

“He has a significant amount of money outstanding to us,” Mr Maroun said.

“We were not paid in agreement with the contract and we suspended work. We waited seven months in good faith. We kept the crane and the sheds on site and we kept paying our contractors. When it got to January this year we decided to exercise our rights in the contract.”

Mr Maroun said they were not shown anything that formally confirmed new finance had been approved.

“With the amount outstanding we were not in a position to wait any longer,” he said.

On January 9 the Leader reported that a half-built apartment project was up for sale in Cronulla after developer Lainson Holdings' non-bank financier called time on its unpaid loans.

Builders walked off the 25-29 Tonkin Street property after the local developer's unidentified private lender called in administrators on the 28-unit project, six months before scheduled settlement with buyers.