Prestige developer dodges collapse
Prestige residential developer, Knight Building Group director, Ronen Kavallero, has avoided collapse following a personal insolvency agreement which saw debts of c$32 million settled for $150,000.
Boral, Bowens and Bunnings were amongst the creditors, owed over $90,000 collectively.
Popular, family-run Caulfield building supplier, Penhalluriack’s, was also out of pocket – for twice that amount.
Legal giants KCL Law and Mills Oakley, the latter which was waiting on nearly $800,000, are also listed as creditors, as are the Commonwealth Bank, Westpac and Australian Taxation Office.
National Australia Bank is the biggest casualty – owed over $10m between mortgages and credit cards.
Few winners
Knight is a prestige low and medium density residential builder, focusing in the Bayside and Glen Eira areas.
Mr Kavallero’s financial problems, he claimed, stemmed from a Brighton townhouse project developed in 2016/17.
Late last year, the builder’s opulent family home in Ward Avenue, Caulfield North, traded for $5.45m (however, this property was owned by his wife, also a creditor).
PCI Partners was approached to be trustee in February.
The month after, Mr Kavallero executed a Section 188 authority under the Bankruptcy Act.
Excluding party-related liabilities, debt was put at $27.4m; in recommending creditors accept the offer, the trustee described the businessman’s affairs as “extremely complex”.
“A significant amount of time would also be required to be spent by a bankruptcy trustee, in particular to his interests held in associated entities,” it said, adding that those owed money could be required to pick up the recovery action cost (story continues below).
Creditors accepted the PIA in May.
Knight is continuing to trade – a spokeswoman saying Mr Kavallero is available to speak about a townhouse project – however the company’s listed office, a former Coat Man factory outlet on Glen Huntly Road, Caulfield South, recently hit the market for lease via Gross Waddell ICR.
Others not so lucky
Meanwhile, another local outfit, Snowdon Developments, entered voluntary administration last week.
It is understood the company paid its biggest creditor in full – nearly $1m – before calling in a trustee.
The group also listed for sale real estate it is understood will cover part of the balance, speculated at between $2.5m-$17.8m.
In other recent building industry news, South Africa’s Wilson Bayly Holmes-Ovcon Limited has, as expected, struck an agreement to pay all entitlements of the Probuild business it put into administration in February.
Its creditors will receive between 50 and 71c per dollar, while some larger ones have settled on up to 24.6c.
That business in Australia has slowly been sold down, with Roberts Co picking up some Victorian projects, and Hutchison taking over a contract for a Brisbane CBD apartment tower.
ABD Group, BA Murphy, Condev, Dyldam Developments, Hotondo Homes Hobart, New Sensation, Next, Pivotol, Privuum and Waterford are amongst other building companies to recently fold – profits absorbed by material delays, and rising costs post-COVID.
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