Major Developer Bensons Property Group Enters Voluntary Administration: A Wake-Up Call for the Property Sector
The Australian construction and property development industry faces another significant setback with Bensons Property Group (BPG), one of the country’s major developers, entering voluntary administration. While the company assures stakeholders that ongoing projects remain unaffected, this development highlights the deep-seated challenges plaguing the sector.
Bensons Property Group enters administration with unfinished work. Picture: NewsWire / Luis Enrique Ascui
Mounting Pressures in a Post-COVID Landscape
Bensons Property Group attributes its financial troubles to ongoing difficulties in the construction industry, including higher interest rates and escalating building costs. These pressures have made it increasingly difficult for developers to sustain operations, especially in the wake of the COVID-19 pandemic, which has disrupted supply chains, labour availability, and profitability across the sector.
Craig Shepard and Sebastian Ham of Korda Mentha have been appointed as voluntary administrators, with Keith Crawford and Matthew Caddy from McGrath Nicol acting as receivers and managers. Despite the financial strain, the company intends to continue trading during the administration and receivership period, with assurances that employees, trade creditors, and apartment buyers will remain protected.
BPG’s $1.5 billion development pipeline, which encompasses over 1,000 homes, is expected to proceed. Managing Director and CEO Rick Curtis reaffirmed the company’s commitment to stakeholders, stating:
“We are taking this action to help protect their interests and the interests of BPG. This was not an easy decision, but there are no plans for redundancies.”
A Sector Under Pressure
The challenges faced by Bensons Property Group are not unique. Other prominent developers, such as Clough Group, Probuild, and Porter Davis Homes, have also succumbed to financial strain in recent years.
According to ASIC data, over 2,800 Australian construction companies became insolvent in the 2023–24 financial year. These collapses have been driven by several key factors:
Labour Shortages: Ongoing workforce disruptions have increased delays and costs.
Rising Costs of Raw Materials: Global supply chain issues have inflated prices, eroding already narrow profit margins.
Industrial Disputes: The Australian Bureau of Statistics reports that 59% of all working days lost in the September quarter were in the building and construction industry.
Shaun Schmitke, Deputy CEO of Master Builders Australia, highlighted the broader implications of these challenges, stating:
“In the middle of a housing and cost of living crisis, we need industry to be working at its peak. Long and unnecessary industrial disputes lead to higher costs and longer wait times for much-needed housing and supporting infrastructure.”
Bensons’ Legacy and Pipeline
Founded by Elias Jreissati in 1994, Bensons Property Group has been instrumental in shaping Australia’s urban landscape. The company is currently managing the construction of over 1,337 apartments across Tasmania, Victoria, and Queensland, including:
A $485 million, 41-storey tower on the Gold Coast’s Chevron Island.
740 apartments across Melbourne’s suburbs, collectively valued at $452 million upon completion.
While some projects have been delivered, others remain in various stages of construction or planning.
Renown Lending: A Proactive Approach to Risk
The collapse of Bensons Property Group underscores the critical need for financial due diligence in the property sector. At Renown Lending, we prioritise rigorous risk assessment to safeguard our investments and protect our stakeholders.
Each lending decision is backed by comprehensive analysis, ensuring that projects are financially viable and that borrowers have the capacity to meet their obligations. By undertaking thorough due diligence, we mitigate risks that could lead to insolvency or project failure.
Investor Summaries: Building Trust Through Transparency
Renown Lending distinguishes itself by providing detailed investor summaries for every project we finance. These documents include clear breakdowns of risks, returns, and project timelines, offering our investors confidence and peace of mind. Our commitment to transparency ensures that we can honour our financial obligations and maintain long-term stability.
A Better Way Forward
While the Australian Government has set an ambitious target of building 1.2 million new homes by 2029, the property and construction sectors must address systemic inefficiencies to achieve these goals. Bensons Property Group’s situation is a stark reminder that financial discipline, strategic foresight, and effective risk management are more critical than ever.
At Renown Lending, we are committed to supporting the industry by financing well-vetted projects that contribute to Australia’s housing needs. Our focus on due diligence, transparency, and accountability sets us apart as a trusted partner in a challenging market.
