A real estate company with more than $3 billion debt has fallen into administration as lenders looked to sell their loans.<\/p>\n
Western Sydney company Bathla on Tuesday appointed Teneo as its administrator.<\/p>\n
The move freezes operations at Bathla, which has almost 15,000 homes and apartments under construction across Western Sydney.<\/p>\n
Bathla\u2019s managing director Bhart Bhushan said the company faced a \u201cperfect storm\u201d contributing to the decision, including Labor\u2019s recent tax changes.<\/p>\n
\u201cThese included: a significant softening in sales, impacts from the changes made in the federal government\u2019s May budget and falling confidence in key markets,\u201d Mr Bhushan said in a statement.<\/p>\n
He stressed that rising construction costs had coincided with these pressures and had \u201cflow-on effects\u201d to lending markets, \u201cputting further pressure on the business\u201d.<\/p>\n
Bathla has hundreds of entities under its umbrella including Universal Property Group and Raj and Jai Constructions.<\/p>\n
The company\u2019s private credit lenders were looking to sell their loans backing Bathla at a discount, per The Australian<\/a>.<\/p>\n This would have helped the lenders avoid losing large sums on the loans if Bathla were to collapse.<\/p>\n Documents show Bathla has secured almost $3.6 billion in loans from lenders and had drawn down about $3.1 billion as of several months ago.<\/p>\n Bathla\u2019s CEO Robert Loader said the administration was in the \u201cbest interest of all stakeholders\u201d.<\/p>\n \u201cThe business has been through a period of declining sales and falling property prices, while construction costs have increased,\u201d Mr Loader said in a statement.<\/p>\n \u201cWe will work constructively with the administrators to support the continued delivery of much needed housing for Western Sydney.\u201d<\/p>\n Administrator Stephen Longley said discussions were ongoing with lenders to maintain construction and support Bathla\u2019s operations during the administration process.<\/p>\n \u201cOur priority is to stabilise the business so that construction activity and property settlements can continue in the ordinary course,\u201d Mr Longley said.<\/p>\n \u201cOur objective is to ensure project continuity wherever practicable, and work with lenders to minimise disruption for employees, customers and contractors.\u201d<\/p>\n Read related topics:Australian business<\/a>Housing Crisis<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"A real estate company with more than $3 billion debt has fallen into administration as lenders looked 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