A building giant with a turnover of nearly $100million just two years ago has become the latest construction business to collapse.
The Western Australia-based FIRM construction announced on Thursday night that it had gone into administration, with subcontractors reportedly owed hundreds of thousands of dollars.
It is the latest in a series of building giants which have gone under in the last year, with a bleak outlook across the industry and thousands of wannabee homeowners left in limbo.
Director and co-owner Mark O’Gorman said the company had been undone by growing financial difficulties caused by higher labour and material costs.
‘We have been closely engaged with the Department of Finance in the past few weeks to ensure our approach is aligned in terms of how best to deliver on our public sector projects, and we hope that process will continue while we are taking steps to restructure the company,’ he said.
A company that had a turnover of nearly $100million just two years ago has become the latest construction industry business to collapse.Pictured is a female tradie
Mr O’Gorman said though the company had completed 75 projects worth $500million for the WA government since 2010, FIRM had been hit by labour shortages and global supply chain issues since the Covid-19 pandemic began.
The storm of crises afflicting the construction industry has led to the slashing of profits on existing fixed-price contracts.
‘It is unfortunate that five projects awarded by the state government between July 1 2021 and May 2022 did not qualify for any financial relief for the significant cost escalations they incurred,’ he told .
Earlier this week, FIRM lost the contract to build Wellard Village Primary School over fears it would not be ready for the coming school year.
It had already lost other state government and private projects.
Thousands of Australian tradies have gone broke in recent times as building firms collapse.Pictured is a house under construction
Subcontractors on that project are reported to be owed several hundred thousand dollars.
Mr O’Gorman said his company had been doing everything it could to work through its financial challenges.
‘Paying our staff and subcontractors while continuing to deliver the projects we have committed to has been our focus and priority.’