Developer Bathla told to fix defects as it teeters on the edge of liquidation

September 3, 2026 — 12:40pmThe state’s building regulator has ordered the collapsed Sydney developer Bathla Group to fix serious defects in one of its major projects, as administrators desperately work to save the company from liquidation.With the deadline to save the developer nearing its end, Bathla’s main corporate entity Universal Property Group has been hit with a building work rectification order for its under-construction development in the Illawarra’s Kembla Grange.Sue Mancuso and daughter Marie Sinclair stand in front of the fenced-off Kembla Grange development.Wolter PeetersBuilding Commission NSW identified 12 serious defects in the five-building development, including non-compliant installation of a waterproofing system at the basement slab.“The non-compliant waterproofing system to the basement slab soffit will lead to water ingress and cause unhealthy or dangerous conditions, loss of amenity for occupants and undue dampness or deterioration of building elements,” the order read.Failure to comply with the requirements listed in the building work rectification order, which must be complied with within eight months, is a criminal offence.Marie Sinclair’s elderly parents are among buyers who purchased an apartment in the development, which they were told would be completed by December 2025. When she visited in September last year, she found doors with keys left unattended, graffitied walls, half-finished copper piping and multiple broken surfaces.Sinclair told this masthead after the building order was issued on Thursday, “it is really good news” but she remained uncertain about the next steps.“Does that mean they have eight months to have the rectifications completed? Also will purchasers need to wait eight more months before moving in?” Sinclair said. “For many of us, this means more money and rent and storage fees for everyone.”Bathla entered into voluntary administration last week with $3.3 billion in debts. For the past few days, administrators Teneo have been desperately trying to secure funding from private lenders to pay the company’s 350 staff by Thursday and finish its 45 construction projects.Teneo has been contacted for comment.When this masthead asked Bathla last month about the development, the company’s spokesperson said 80 per cent of the 108 units had been sold off the plan and that buyers would be able to move in “during October or November”.“On completion the project will be handed to the buyers in great condition,” the spokesperson said at the time.More to come.The Morning Edition newsletter is our guide to the day’s most important and interesting stories, analysis and insights. Sign up here.From our partners