Aerial view from Pokeno, Auckland, where builder has put up more than 200 new residences.
South Auckland house builder Compass Homes (Franklin), which put up more than 200 new residences in Pōkeno, has gone into liquidation today.
Grant Reynolds of Newmarket has been appointed the liquidator, Companies Office
records show. Reynolds is also the liquidator of a number of other Compass businesses.
Creditors expressed disappointment about the South Auckland builder, saying they were owed money and wanted to be paid.
The company is owned by interests associated with Garry Shuttleworth who said last month it was no longer trading. He had not then decided what to do at that point.
“It’s the perfect storm,” Shuttleworth said of problems in the residential building sector that beset his company.
Two staff members who were in sales had resigned, the price of land had risen astronomically, building material costs were escalating, interest rates were still high, inflation remained elevated and people were having trouble getting access to finance, he said on January 31.
Sections that were just under $200,000 a few years ago were now going for $550,000 and above in Pōkeno alone, he said.
“At the moment, I’ve ceased trading [that company] and what I will do, I don’t know. I’ll have meetings in the next few weeks to determine that. The company is unable to pay its bills,” Shuttleworth said.
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How much is owed remains unknown.
Shuttleworth said the company had built hundreds of new homes in Pōkeno alone.
“The company hasn’t made a sale for 12 months,” he said.
One creditor this month said he was encouraged to continue to finish work for Compass.
“We kept being told we had to finish them so the owners could move in and we could be paid. Where is the money?” he asked.
The subcontractor told the Herald losses from the Franklin business were not the first from a Compass company. He had lost nearly $30,000 when another Compass business failed last year. That was Compass in the western Bay of Plenty that was liquidated. One family complained of losing more than half their $55,000 deposit when that business failed.
Terwen Investment, trading as Compass Homes (Western BOP), went into liquidation last April. Grant Reynolds of Reynolds & Associates was appointed by the shareholder. The company is owned by Terence and Wendy Sharplin of Tauranga and Terwen Holdings.
Reynolds’ six-monthly report said the director Terence Sharplin blamed the pandemic, the GIB crisis and delays in PlaceMakers delivering frames and trusses. Rising interest rates meant customers had cancelled or delayed building contracts and cost rises impacted fixed-price building contracts.
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Creditors were listed as being owed $364,000 by that business and include Aotea Security (NZ), Bay Glass & Glazing, Entire Electrical Bay of Plenty, Carpet Court Retailing, Prestige Loos, Enviro NZ, PlaceMakers, Central Contracting, Off the Wall Construction, SDP Construction and Wallboard Systems.
Another person who had dealt with Compass Homes (Franklin) said this month many customers had lost money because work had not been completed. Some people were afraid to speak out about it, he said this month.
“There are numerous examples where remedial works have been outstanding for two-plus years when in fact they should be remedied by law within the first year of a new build being finished. It’s a sad state of affairs,” he said.
Anne Gibson has been the Herald’s property editor for 24 years, has won many awards, written books and covered property extensively here and overseas.
