Braemar Building Limited, formerly Stonewood Homes Dunedin Ltd, was placed into liquidation in November last year by shareholder resolution.
Graeme Sneddon, the company’s co-director, ran the Stonewood Homes Dunedin franchise between 2008 and May 2024.
The total shortfall to all creditors was, until this week, estimated at $850,000.
But the liquidator’s latest report put this figure at $6,087,500 and believed nearly 95% was unlikely to be repaid.
The estimate included $337,000 owed to the Inland Revenue Department (IRD) and $5,750,500 owed to unsecured creditors, which was ‘‘higher than estimated’’.
It was ‘‘not likely the unsecured creditors will receive a dividend upon the completion of the liquidation’’.
Liquidation proceedings were commenced against the company by the Registered Master Builders Association of New Zealand, a previous report said.
In a text response, Mr Sneddon claimed Master Builders had lodged a ‘‘ridiculous claim’’ for $5m.
‘‘This claim is baseless and had no merit, and we are unaware of how Master Builders quantified that amount.
‘‘We leave it to the Otago Daily Times to inquire from Master Builders how that amount is quantified.’’
Stonewood Homes had also filed an ‘‘entirely baseless claim’’, Mr Sneddon said.
‘‘Stonewood had never been able to provide Braemar Building with particulars of that debt.’’
‘‘Both Stonewood and Master Builders have filed arbitrary and unproven amounts with the liquidator, each party knowing full well that it is unable to substantiate its claim.’’
Braemar Building Ltd paid all of its core debt to the IRD before being placed into liquidation, Mr Sneddon said.
But IRD had since lodged a claim for penalties and interest that had added to this core debt.
He estimated the unsecured creditor claims amounted to about $125,000, which would be offset by accounts receivable still owed to the company.
Master Builders chief executive Ankit Sharma said it was surprised by the extent of the money estimated to be owed by Braemar Building Ltd.
‘‘Our concern is with all creditors affected, including suppliers and others who may now be facing significant losses.
‘‘Situations like this have a real impact across the sector.
‘‘As an industry, we all have a responsibility to identify and address concerns before they escalate to this point.’’
Outram resident Chase Klimeck said he and his wife commissioned Stonewood Homes Dunedin to build their nearly $700,000 ‘‘dream home’’ in 2020.
While not owed any money, he noticed issues with the quality of the build that he said were yet to be fixed.
When told about the new figure yesterday, Mr Klimeck said ‘‘holy f...’’.
‘‘I did hear that he owed people a lot of money, but I didn't realise it was exactly that much.
‘‘It’s a s... load of money.’’
Mr Sneddon has previously disputed Mr Klimeck’s allegations and claimed he breached the building contract.
In his first report, liquidator Brenton Hunt cited several reasons for the insolvency.
The company suffered from the Covid-19 lockdowns ‘‘and sales never climbed back to pre-Covid levels’’.
‘‘One project had a number of issues and Stonewood Homes took over the build.
‘‘Sales continued to drop with the recession, leading to the company being closed down.’’
A new Stonewood Homes franchise, trading as Stonewood Homes Otago, was established more than two years ago.
It is independently owned and operated and is not connected to Braemar Building Ltd.
