Bay building firms collapse

Four building companies inTauranga have fallen, another is rumoured to be in trouble and many qualified tradesmen are without work as the economic downturn bites hard in to the once-flourishing property market.
Over the past few days, well-established Miden Construction NZ, trading as Miden Homes and Builders By Design, have gone in to voluntary liquidation _ and manufacturer Timber Finishings, which has been operating at Mount Maunganui for 43 years, went in to receivership.
Civenco Construction Bay of Plenty, which built the Sebel Trinity Wharf Hotel in Dive Crescent and was a sub-contractor on the original Tauranga Harbour Bridge, also filed for voluntary liquidation in mid-June.
The downturn, some are now calling it a recession, has hit home in the past two to three months _ at a time when petrol and food prices continue to climb and mortgage rates remained high.
Many building companies and suppliers have shed staff _ some by as much as 30 per cent _ and market observers are saying the industry has struck its toughest patch in 20 years.
Peter Roden, president of Tauranga Registered Master Builders Association, said:
"It wasn't long ago builders were looking for qualified carpenters and now there are good guys who don't have any work. Most of the people I know are certainly not replacing any staff who leave.
"There's a certain amount of (building) activity but it's hugely reduced right across the board _ commercial, new homes, development projects, and to a lesser degree renovations."
His own company, Adobe Homes, has reduced its fulltime staff from 12 to eight and it no longer carries any sub-contractors.
"I've told my guys to take some holidays," he said.
Liquidator Tom Rodewald said his firm, Rodewald Hart Brown, was fielding ``a big uplift' in inquiries from companies having financial problems.
"There's been a noticeable downturn in the economy in the last three to four weeks. We've been real busy and it's going back to the old days of the late 1980s."
Yesterday, Mr Rodewald's staff started handling the liquidations of Miden Construction and the smaller Builders By Design.
Miden, which had a change of ownership in late 2004, has been building new homes in the Bay for more than 20 years. The company collected three awards at theMaster Builders gala dinner in Tauranga just three weeks ago.
Mr Rodewald said Miden had a major disputed debt and losses from projects.
"It's a sizeable shortfall on the surface but it's early days (of the investigation)."
Mr Roden said it was disappointing that Miden got in to trouble soon after the awards.
"They must have known what was going on _ and when you belong to an association like Master Builders there is always help available. We want to see companies survive the tough times."
Family-owned Timber Finishings, which began operating in July 1965, suffered a 30 per cent drop in turnover over the past three months _ and it was cornered in to asking its bank to appoint a receiver last Thursday. The joinery factory, with about 40 staff, is continuing to trade in Hull Rd but Timber Finishings' Matangi sawmill in Aerodrome Rd has closed, with 10 staff laid off. Mr Rodewald was hopeful of selling the business as a going concern. ``There's plenty of interest, and the sawmill can be switched on straightaway,' he said. Timber Finishings owner Warwick Lee said he had never seen the turnover drop the way it did _ ``it was like an axe coming down'. The business was started by his father and two brothers, and recently up to a quarter of theproduction has been exported. Civenco Construction went in to voluntary liquidation with a deficit of just over $900,000, but 80 per cent of that money was advanced by the owners through associated companies. Geoff Payne, a director of Civenco, said it was always the intention to shut down Civenco once the Trinity Wharf Hotel was finished. ``It was the last contract and we were out _ it wouldn't have mattered whether the climate was robust or depressed.'