Insolvent Australian property developer Bathla Group is in urgent discussions with its creditors, facing a 24-hour deadline to secure critical short-term funding. The company, a major residential developer in Sydney, owes approximately A$3.3 billion ($2.4 billion) to its creditors.
Bathla appointed an administrator in August after struggling with debt amid a slowdown in Australia's property market and escalating construction costs. The firm's total debt to known creditors is about A$3.4 billion, including A$3.1 billion owed to secured lenders and A$130 million ($94 million) to unsecured creditors.
Preliminary figures reveal Bathla owes $145 million to the Australian Taxation Office, $42 million in unpaid land tax, about $10 million to the NSW iCare insurance scheme, $4 million in employee wages and superannuation, and an additional $2 million in payroll tax. The administrators, Teneo, have warned that most of the developer’s construction sites could shut down without immediate funding, as the group only has $200,000 in cash. Keeping construction operating is estimated to cost about $1 million to $1.3 million per week.
Teneo is engaged in discussions with five major lenders for emergency funding to prevent a collapse that could impact thousands of buyers, contractors, and other creditors, as well as the wider housing market. About 21 employees and subcontractors have been stood down, and the company is struggling to meet ongoing payroll obligations, despite securing enough funds to cover payroll on September 3. The failure of Bathla, which relied heavily on non-bank finance, is also drawing scrutiny to the private-credit market.
