Work on a $1.1 million refit of a Massey University laboratory has stopped with the collapse of Mainzeal, just three weeks before the project was to be completed.
The upgrade of a food nutrition lab at the university's Palmerston North campus was 90 per cent complete. Now construction at the site has stopped, Massey spokesman James Gardiner said.
The company, which has 400 staff and an office in Palmerston North, was put into receivership yesterday by its sole director Richard Yan.
Receivers PricewaterhouseCooper were yesterday unable to say how much debt was involved.
Mr Gardiner said Massey had been paying Mainzeal on a month-by-month basis for the construction project.
Money not yet paid to Mainzeal would be passed on to someone else to complete the job, depending on advice from PriceWaterhouseCooper, Mr Gardiner said.
"We won't pay for what hasn't been done."
Mr Gardiner said Massey was concerned for contractors understood to be owed money.
"Our understanding is Mainzeal were slow payers. That's our concern."
One of those contractors left out of pocket was Total Sheetmetals, which Mainzeal contracted to do work on the upgrade of the youth justice facility at Mohaka Pl, Palmerston North. Total Sheetmetals manager Shaun Palmer would not say how much the company was owed by Mainzeal, other than to say the amount was "a lot".
"We'll get through," he said.
Unlike contractors in other parts of the country, Mr Palmer's firm was able to remove its gear from the worksite on Tuesday. He had asked a Manawatu-based Mainzeal staff member if things were right financially with the company and was told they were not.
The collapse of Mainzeal was going to "hurt a lot of people".
"Mainzeal's receivership will flow on down the line and will have a big financial impact both locally and nationally."
In Manawatu, Mainzeal had also been involved with the Ohakea Air Force Base upgrade work known as Project Takatini.
Project Takitini involved construction of facilities to house the new NH-90 and A109 helicopters, workshops and a new air movements terminal.
A Defence Force spokeswoman said yesterday that "there are no issues with the project being completed".
Mainzeal established offices in Palmerston North in 1991 and has completed numerous large-scale construction projects around Manawatu.
They include the Palmerston North City Library, stages one and two of the Tararua Wind Farm, the Palmerston North police station, Arena 1 at FMG Stadium and the Foodstuffs Distribution Centre.
- © Fairfax NZ News
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