Multiplex’s $250m lawsuit over Sydney Fish Market as bill nears $1.25b

1 week ago 2

Construction giant Multiplex is suing the NSW government over cost blowouts on the new Sydney Fish Market in a case that threatens to tip the total bill for the project to $1.25 billion and bankrupt the company that runs the markets.

Multiplex has filed a $250 million lawsuit against Infrastructure NSW, which has brought a cross-claim against Sydney Fish Market for allegedly contributing to the cause of the action.

The new Sydney Fish Market is the subject of three-way legal action between the builder, the government and the head tenant.

Neither the Sydney Fish Market nor Infrastructure NSW will commit to an opening date for the new site beyond saying that they expect partial completion to occur in November, “facilitating an opening prior to Christmas”.

According to the market’s annual financial report, Multiplex is claiming that INSW breached its contract and mismanaged the construction of the new Sydney Fish Market on Blackwattle Bay.

INSW has alleged in its cross-claim that Sydney Fish Market Pty Ltd caused or contributed to matters relevant to the Multiplex claim. Most of the market’s subtenants refused until last month to sign new leases due to concerns about power supply, and what they claimed was an inadequate contribution by the government to their fitouts.

The legal claim, which is the same size as the original 2017 budget for the whole project, is the culmination of years of headbutting between the builder, the market and the government over the cost, scope, design and timing of the project delivery.

When Multiplex was awarded the fixed-price contract in 2020, the new premises were expected to open in 2024, but delays caused by COVID-19, the collapse of a crane, wet weather and wrangling over the design pushed back the opening to at least the end of this year.

A collapsed crane on the Sydney Fish Market construction site in 2023 set back the building timetable.

The delays contributed to cost overruns, as the price of labour and building materials skyrocketed. But the Minns government, which inherited the $836 million project when it came to power in 2023, has resisted pressure for any further budget concessions.

Multiplex has in turn held its subcontractors to the letter of their contracts, forcing at least one company to file for voluntary administration after its costs increased by $32 million while external factors slowed down or paused construction, with the effects rippling across the building industry.

Sharvain Facades, which designed and manufactured the distinctive wave-shaped roof, was still being asked to change aspects of what it had agreed to deliver six months after it commenced construction due to continuous revisions by the client, according to court documents.

Multiplex allegedly bullied Sharvain’s managing director Boris Kostura into signing a “loan” that closely resembled a payment contract to ensure Sharvain finished installing the roof before the company collapsed. Portions of the loan were “forgiven” as building milestones were met.

The builder is also being sued by the engineering company that built the watertight structure known as a cofferdam that allowed the market to be built over an area previously occupied by water, for allegedly refusing to pay it and taking work out of its hands.

Sydney Fish Market had delayed the release of its financial statements until all its subtenants had signed their leases at the new site, to avoid material uncertainty on the books. The litigation is a much more significant potential liability.

It has come as the market returned to profitability for the first time in three years, posting a $972,130 profit for 2024-25.

The market’s directors said in the report the company would “strongly defend” the cross-claim and was confident it had complied with its contractual obligations and acted appropriately.

“However, given the size of the cross-claim and uncertainty of outcome of this matter, this raises a material uncertainty over the group’s ability to continue as a going concern and therefore that it may be unable to realise its assets and discharge its liabilities in the normal course of business.”

The financial statements also indicated executive remuneration increased by 19 per cent over the financial year, which followed a 23 per cent increase the previous year. Sydney Fish Market said this was attributable to an increase in the number of executive personnel, and the average increase in salaries, wages and employee benefits for executives was 3.5 per cent.

The company will begin paying rent on practical completion of the building, which is expected before the end of the year.

Sydney Fish Market said it would begin charging its subtenants rent at the new site “in accordance with their individual leases, which are varied and commercial in confidence”.

The market’s management originally told its tenants it needed 75 per cent of them to be ready when the market opened, but has recently accepted it may have to open with as few as 30 per cent of retailers trading. It has also conceded it might not be open in time for Christmas.

INSW declined to comment on how many retailers would need to be ready to begin trading for the market to open its doors to customers.