Brookfield Multiplex cites lack of projects in liquidation of NZ unit

Tuesday 8th January 2013

Brookfield Multiplex, the Australian firm whose New Zealand developments included the Sylvia Park Shopping Centre and the Pegasus Town development, says a lack of new projects in a tough market drove the decision to liquidate its local unit.

Brookfield Multiplex Constructions (NZ) appointed liquidators on Dec. 4 though it had largely ceased operating in 2011, when it made most of its workers redundant. It has a shortfall to unsecured creditors estimated at $2.4 million, according to liquidators Anthony McCullagh and Stephen Lawrence of PKF Corporate Recovery & Insolvency (Auckland). Realisable assets were estimated at $44,279, though with some items including retentions listed as unknown.

"A continued lack of opportunities in the market prevents Brookfield Multiplex from maintaining a presence [in New Zealand] in its traditional form," the directors said, according to the liquidators' report of last month. "This follows on from nearly two years operating without an active project in a highly competitive market, as well as receiving on-going financial support from its parent company."

The Sydney-based parent withdrew that financial support on Dec. 3, forcing the local unit to cease trading.

Brookfield Multiplex Constructions (NZ) had a loss of $4.4 million in calendar 2010, the last year it provided results to the Companies Office. That's down from a loss of about $39 million in the previous year. Construction revenue was about $37 million in 2010.

The liquidators' report says the company faces as-yet unquantified claims on construction contracts including Spencer on Byron, Nautilus Apartments, Century on Anzac, Victoria Apartments and Sylvia Park.

Brookfield Multiplex was formed in 2007 when Canada's Brookfield Asset Management acquired Australian developer Multiplex, whose projects included the troubled Wembley Stadium development, for about A$7.3 billion including debt. It still has nine companies registered in New Zealand that aren't in liquidation, including Brookfield Funds Management, part of a global asset management business overseeing some US$150 billion of assets.

A spokeswoman for Brookfield Multiplex in Sydney didn't immediately return calls.

The New Zealand company sold its 50 percent stake in Pegasus Town Ltd to partner Infinity Investment Group in 2010 for $1 million, having taken a $34 million impairment the previous year.

Pegasus Town went into receivership last August, owing some $142.8 million to a joint venture between Goldman Sachs and Brookfield Asset Management, which bought the debt at a discount in 2011 from Bank of Scotland International as part of a $1.3 billion portfolio in New Zealand. The development was acquired from the receivers by Todd Property last month.

(BusinessDesk)

BusinessDesk.co.nz

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