The collapse of the Bathla Group, one of New South Wales's largest property developers, has left thousands of homebuyers in limbo and raised serious questions about the viability of Australia's housing targets. The company went into voluntary administration on 25 August, weighed down by almost $3.6bn in debt, according to administrators Teneo.
A retirement plan shattered
Donna Jones, a 63-year-old disability support worker, bought a one-bedroom unit off-the-plan from Bathla, expecting it to be part of her retirement plan. She paid a $54,500 deposit for her Kembla Grange apartment in September last year, but after almost a year of delays, she learned through the media that the developer was on the verge of liquidation.
"I'm terrified that I'm going to lose my deposit," Jones said. "I've worked all my life. I was a single mother. This was my retirement."
Jones is among thousands of customers affected by Bathla's collapse. The administrator, Teneo, said it was not in a position to refund any deposits, leaving buyers in uncertainty.
Broader industry stress
The Bathla crisis is not isolated. According to data filed with the corporate regulator, more than 7,000 construction companies have gone bust since the national housing accord came into effect in 2024. There were 3,472 insolvencies last financial year, down slightly from 3,596 in 2024-2025.
Prof Nicky Morrison, a planning expert at Western Sydney University, said the issue goes beyond one developer. "For me it goes beyond one developer and raises the bigger question of how the housing pipeline we are planning for is actually going to be financed and delivered," she said. "Planning targets are one thing, but we need to think about finance, infrastructure, construction and genuinely affordable housing alongside them."
The national housing accord, which aims to build 1.2m new homes by the end of 2029, is forecast to miss its deadline by at least another year.
Administration and unpaid wages
Teneo, appointed as Bathla's administrator, entered crisis talks with private lenders to try to save the company. Its immediate priorities included finishing the estimated 2,000-2,500 homes on which construction had already begun. However, after the NSW government rejected a bailout request, Teneo warned it would be forced to liquidate if it did not secure enough cash.
At a creditors meeting on Friday, administrators revealed about $40m in wages and superannuation was still owing to workers, along with $3.4bn in debts to creditors. Some staff had gone without wages for eight weeks. On Thursday afternoon, administrator Stephen Longley said partial payments were made to staff whose wages were due.
Teneo said it was in discussion with five lenders about funding to keep parts of the business open, but it would not be able to continue unless funding was secured by Monday, according to the ABC.
A volatile industry
Property lawyer Renee Roumanos said she often hears from homebuyers in similar predicaments. "It's very common, unfortunately … I probably hear this monthly," she said. Speaking generally, she said the building industry is "already in a really volatile state" due to increased labour and materials costs.
Residential construction is exhibiting higher stress than non-residential, according to analysis by CreditorWatch. This is partly because there are more smaller businesses and sole traders in the residential space, who have tighter margins and are more vulnerable to economic pressures. The commercial sector has been buoyed by demand for datacentres, which may drive up material and labour costs for residential builders.
Cameron Kusher, an independent property economist, noted a "massive" increase in the cost of constructing new housing and higher interest rates, leading traditional lenders to be wary of financing developers, who often seek riskier private credit.
Jones said she has heard "absolutely nothing" from Bathla or Teneo, and her only updates come from the news or visits to the construction site. "I want them to tell me my unit will be fixed, it will be finished, and I can move in," she said.
