Project’s subbies waiting to get paid

A subcontractor from a troubled Build Partners’ state housing site claims he is owed “hundreds of thousands of dollars” but the company chief executive said the business had tried to be as supportive of subcontractors and suppliers as possible when price escalations caused problems.

Crown agency Kāinga Ora has taken control of four residential projects for 91 new state apartments previously being constructed by housing construction specialist Build Partners after the state agency said it was contacted by several Build Partners’ subcontractors claiming they had not been paid for their work.

The subcontractor said he hoped Kāinga Ora would pay his bills and those of many others on the project also claiming to be owed money.

He expressed great dissatisfaction

We want to assure all subcontractors impacted that we are working with urgency to ensure they get paid, and we are establishing a plan so work continues on all four social housing developments.

Patrick Dougherty, K¯ainga Ora

with the project his business worked on and said he was left disillusioned.

Mounting bills went weekly without payment.

Patrick Dougherty, Kāinga Ora construction and innovation general manager, said: “Kāinga Ora has contacted all known subcontractors and we are meeting with as many as we can this week and next to verify the information provided to us by Build Partners on the amount they are owed.

“We want to assure all subcontractors impacted that we are working with urgency to ensure they get paid, and we are establishing a plan so work continues on all four social housing developments.”

The subcontractor claimed other subcontractors had not been paid since the end of last year, and that he knew of several struggling as a result.

The man did not want his identity known, saying he still hoped Kāinga Ora would pay him for work completed but if he speaks out, he fears the money could be at risk.

Steve Mikkelsen, a director of Build Partners and chief executive of its owner Property Partners, said he anticipated Kāinga Ora would pay the subcontractors.

“When you’ve got 100 subcontractors calling you every day . . . we are not a rogue contractor but a trusted partner with the Government that came unstuck because of the current situation,” Mikkelsen said.

The business had built nearly 700 new state homes, he added.

“My understanding is Kāinga Ora are going to make payments for all subcontractors and suppliers. It’s been a really, really tough market. These projects were priced a long time ago and there’s been a lot of cost escalations.

“We got to a position where we had completion problems with cash flow on these projects. This is pretty standard. It’s nothing new,” he said.

“We are doing everything we can. We are supportive of the subcontractors and suppliers.”

Problems were not related to modular construction, Mikkelsen said.