Corbel Construction, the construction firm who was in charge of building the Parnell Terraces, went into liquidation this week.
After having a leaky building lawsuit awarded against them, Corbel Construction’s directors decided to put the firm into liquidation.
And yes it is an extremely tricky time for subcontractors because they run the risk of not being paid. Remedial work had began at the Parnell Terraces before Corbel Construction went into liquidation and a Corbel sub contractor was reported to be owed $120,000 before Corbel’s collapse.
This scenario also reminds us why NZérs generally don’t like to buy apartments.
Usually it takes 5 to 10 years after an apartment building is completed to notice any structural issues. If you discover you have bought a leaky apartment building, then it usually involves lengthy and costly litigation with the developers. Even after you win, the developers can file for liquidation leaving the apartment owners having to come up with the money to repair the apartment building, not to mention also they had to come up with money to pay for the lawsuit.
Plus after your building is discovered as a leaky building, banks won’t accept it as security. This means not only can’t you refinance it but it also means there will be few buyers in the market assuming you want to sell.
That’s why as always it’s usually better to buy a brick and tile house or weatherboard house. There’s no hassle with body corporate (assuming you are not owning unit titled property) and there is less chance of a structural issue.