Lender appoints receivers to Land & Homes

AFTER entering voluntary admission last week, listed developer Land & Homes Group’s creditor has appointed a receiver.

United Overseas Bank has appointed Sam Marsden and Timothy Heenan from Deloitte as receivers effective 6 December.

Four years bank, LHM tried selling off its 203-207 Wharf Street in Spring Hill Brisbane for $19.5 million, to repay its lender UOB Bank, though the sale was below what the company acquired site for $21 million in 2016.

The group’s burdensome Fortitude Valley apartment project at 44-100 Barry Parade site was also acquired in 2016, for $20 million.

The country’s struggling construction sector, including high costs and limited labour, put LHM’s plans for 491 apartment residences on the back burner.

Construction costs are looking to remain elevated until at least 2027, according to WT’s latest Australian Construction Market Conditions Report. While Australia needs an extra 90,000 tradies to meet the federal government’s National Housing Accord target of delivering 1.2 million new homes over the next five years.

With Australia just recording its worst 12 months for new home builds in a decade and experts are calling for more action on labour shortages that have drained construction capacity,

At the same time, Brisbane looking at a growing undersupply of apartments in the coming years, with Charter Keck Cramer data showing a need for  build between 6,000 to 8,000 apartments each year to house Brisbane’s forecast 1.6% per annum population growth to FY28, and current trends suggest that only around 3,000 will be built annually over the next few years.

Brisbane is also expected to see worst cost escalation in the country in coming years, from 7.5% this year, into 6.5%, 5.3% and 7.5% per year in the following three years to 2027. There is a $7.1 billion venue infrastructure program in place for the 2032 Games.

LHM’s board of directors previously appointed Geoffrey Trent Hancock of Hamilton Murphy Advisory as the voluntary administrator.

With the receiver appointed, the administer will continue its review and assessment before making recommendations.