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Another construction company has gone bankrupt and is blamed for higher interest rates and construction costs.
Rork Projects, which specializes in building renovations and commercial properties, has appointed insolvency firm McGrath Nicol as administrator, with affected operations in New South Wales, Queensland, Victoria and the Australian Capital Territory.
Director Brian O’Rourke announced that several of his companies went into administration on Friday after 26 years.
“It is with a heavy heart that I announce that after 26 years of trading, Rork Projects has been forced to enter voluntary administration on 1 March 2024,” he said.
“This was the final step in a long journey to find a solution for our staff, clients and subcontractors, and we recognize the devastating impact this outcome has on them.”
Another construction company has gone bankrupt and is blamed for higher interest rates and construction costs.
O’Rourke said rising interest rates and construction costs amounted to a “tsunami of impossible economic conditions.”
“Builders are in crisis due to high interest rates, labor shortages and material supply limitations following the pandemic,” he said.
While inflation has moderated to a two-year low of 4.1 percent, he compared the current series of construction company collapses to the 1970s, when inflation and unemployment were high.
“The construction market is facing one of the worst storms since the crisis of the mid-1970s,” said Mr O’Rourke.
‘While it is devastating for us, it is also detrimental to the Australian economy and community.
“Thank you to everyone we have worked with.”
In January 2024, 552 companies entered external administration for the first time, an increase of 53.8 per cent compared to 359 in January 2023, Australian Securities and Investments Commission data showed.
This came after the Reserve Bank of Australia in November raised interest rates for the 13th time in 18 months to a 12-year high of 4.35 percent, adding to the most aggressive hikes since 1989.
Rork Projects, specializing in building renovations and commercial properties, has appointed insolvency firm McGrath Nicol as administrator, with affected operations in New South Wales, Queensland, Victoria and the Australian Capital Territory.