‘Not in good shape’: more construction industry collapses could follow Probuild

The collapse of construction giant Probuild could be just the start of financial trouble across the Covid-ravaged industry as it struggles with soaring costs and project delays, the construction sector's peak body warns.

Probuild, which directly employed about 750 people and had annual revenues of more than $1.4bn, was placed into voluntary liquidation by its South African owners Wilson Bayly Holmes-Ovcon (WBHO) late on Wednesday.

Contractors and other workers turned up at sites on Thursday in several Australian cities to collect equipment, including at CSL's $750m proposed new headquarters in Melbourne.

"We are caught up in a set of circumstances not of our making," a Probuild spokesperson said. "We are working closely with the administrator [Deloitte] on a number of plans to protect our clients, subcontractors and employees.

"The Probuild brand is strong and we intend to keep it that way. We have several options for raising the necessary capital to continue as a premium Australian building company. These will all be pursued."

Jon Davies, chief executive officer of the Australian Constructors Association, said ongoing absenteeism because of Covid and rising costs of labour and materials meant more construction firms may soon follow Probuild into administration.

"Everyone assumes that everyone's making bucket loads of money," Davies said, noting city skylines are often dotted with cranes, and governments talk up the accelerated spending on infrastructure as a spur for economic growth.