Bathla Group Halts All Construction as Short-Term Lender Funding Runs Out

Australian developer Bathla Group has halted all remaining construction work and stood down its workers after the short-term funding it secured from lenders ran out, the company's administrators said on Thursday.

The group, one of Australia's most prolific builders of affordable housing, entered administration last month carrying A$3.4 billion ($2.4 billion) in debt, leaving thousands of homes under construction in limbo.

Teneo Australia, the administrators, had secured two weeks of short-term funding from lenders on September 7 to keep some projects going, while standing down more than 200 staff in an effort to avoid liquidation. Under a stand-down, employees remain on the books but the employer is not obliged to pay them.

In an update on Thursday, Teneo said the short-term funding had been used up and talks with lenders over additional support had ended.

"As a result, construction workers across 13 Bathla sites have been stood down and all construction operations have ceased," the administrators said.

Teneo said its focus would now shift to working with lenders to sell Bathla's subdivision and land bank sites.

Court documents showed the company had 219 projects underway when administrators were appointed, including 45 sites under construction. Those active building sites accounted for a significant share of the group's debt.