Up to 50 homes in limbo

Building companies’ financial problems leave houses unfinished

A home building company is in liquidation and another in administration, leaving construction of up to 50 homes in limbo and more than $8.4m in debts.

Hope Island company Focus Living went into administration on Monday, the same day its related company Skyfield Homes was wound up.

Michael Caspaney of Menzies Advisory was appointed to both companies, which had construction sites in Nerang,

Helensvale, Hope Island and Brisbane.

Skyfield Homes went into administration in February, leaving 38 homes unfinished and more than $8.4m in debt.

A searing report from Mr Caspaney to Skyfield creditors said the company’s books and records were so badly kept that “any reports from the company’s systems would be meaningless”.

The report said the company’s share capital of $2.2m was not properly accounted for and that Skyfield took customer deposits far in excess of the allowed 5 per cent.

Mr Caspaney said Skyfield’s tax records suggested it had been insolvent since some time in the 2022 financial year. It had $1.82 in the bank when Mr Caspaney was appointed and owed more than $300,000 to the ATO.

Focus Living is listed as owing $2.49m to Skyfield. According to the report, Skyfield was owed $1.55m by trade debtors and $2.22m by shareholders.

“I have queried the director on the quantum of the moneys owed by debtors and was advised that most of them are ‘ledger error – no moneys owed to the company’,” the report says.

“This is not acceptable to me and I will be investigating each and every customer account and reconciling them to the bank accounts in order to arrive at the correct financial position.”

Mr Caspaney said, in the weeks before the administration, Skyfield attempted to shift 38 construction contracts to Focus Living, which had as many as 10 homes under way in its own right.

He said he believed the novation agreements were voidable as they were potentially uncommercial transactions and could hamper the ability of creditors to recoup their funds.

Skyfield subcontractors questioned why staff asked them to complete subcontractor forms for related company Focus Living in the weeks before Skyfield went into administration.

Focus and Skyfield are both directed by Dazhi Wang, 39, whose registered address is in Robina. Skyfield is also a shareholder of Focus Living.

The Bulletin has attempted to contact Mr Wang.

Three other Skyfield directors resigned two weeks before the administration – Hongsheng Ye, Kai Zhi and Tamati Evan Reweti. Nicola Brac, also a shareholder, resigned as a director in November 2023.

Mr Caspaney said a second creditor meeting would be held on April 8.