Nicheliving’s directors’ bid to regain full control of the entities is in limbo after they missed a deadline to sell their Northbridge office - a crucial condition of their buy-back plan.
Under Ronnie Michel-Elhaj and Paul Bitdorf's deeds of company arrangement (DOCA) to pull two of Nicheliving's entities out of administration, the directors were required to sell their office building within 280 days of the DOCA being executed back in January.
Failing to do so could result in their buy-back deal facing variation, termination, or the entities being placed in liquidation, the administrators' report on the entities outlines.
With that deadline come and gone, the Nicheliving directors have sought - and received – a six-week extension from KordaMentha administrators to "assess their options".
RWC WA were the agents selected to sell the vacant commercial office building spanning 912 square metre across four storeys on the corner of Newcastle and Money Street in Northbridge.
The pair's $2.7 million DOCA fund was to be majority bankrolled by the sale of 180 Newcastle Street, which was expected to net $2 million in sale proceeds, according to the administrator's report.
It was initially expected that the office building would be sold in mid-June to then pay the dividend to unsecured creditors and seal the DOCA by late September, according to the administrators' estimated timeframe.
Perth's office vacancy rate is amongst the highest in the nation and sales of offices having been subdued since 2022.
The administrators have ultimately been in control of Nicheliving's operations while the directors have been responsible for day to day operations during this period, in which the conditions needed to be met or waived in order to regain full control.
KordaMentha administrators Richard Tucker and John Bumback told creditors they had agreed to an extension until November 24, with several conditions.
The practitioners said the deadline extension would allow for a greater return to creditors than immediately liquidating the Nicheliving entities.
“The deed administrators have agreed to the extension of the sunset date for the satisfaction of the conditions precedent under the DOCAs based on their assessment that doing so provides every opportunity for creditors to receive a superior return than an immediate liquidation,” KordaMentha wrote.
One of the conditions to the extension is the directors catching up on more than $115,000 worth of outstanding DOCA payments and a second-ranking mortgage being granted on one of the property units to secure the directors’ payment obligations under the deal.
Nicheliving – which had 230 unfinished homes on its books upon its collapse - has been selling off properties and project sites at various stages of development around Perth.
Appointing administrators opened the door for homeowners to apply for home indemnity insurance and appoint alternative builders to finish their long-awards builds.
It marks almost a year since the besieged builder’s directors first met with administrators on October 23 last year, two weeks before their official appointment.
Administrators were called to take control of three Nicheliving entities in November after the residential builder agreed to drop its registration fight in the courts.
Mr Michel-Elhaj and Mr Bitdorf then proposed DOCAs for Nicheliving Holdings and Projex Management & Construction, being two of the three entities in administration.
It all came after the state government stripped Nicheliving of its building registration and banned the company and directors from building for a decade.
Nicheliving could not immediately be reached for comment.
