Luxury hotel project led planning office into million-dollar bankruptcy

It was supposed to be a prestige project. But what began as a promising hotel construction in the federal capital ended in a fiasco that is now driving a company into bankruptcy. Fleissner + Partner Gesellschaft mbH, which has been on the market since 1990 and specializes in general planning and project development, has submitted an application to the regional court for ZRS Graz to open restructuring proceedings. The AKV confirms this to the KURIER. Around 80 creditors are worried about their money, 13 employees are worried about their jobs.

When additional costs become a threat to your existence

What has brought the Graz-based company based on Körösistraße into this precarious situation reads like a lesson in the risks in the construction business. At the center of the misery is the hotel project in Vienna. What initially went according to plan turned into a financial nightmare. “There were significant additional costs,” it says succinctly in the bankruptcy filing. After all, after “appropriate clarification,” an agreement was initially reached with the client and payments were made. Even the sole shareholder dug deep into her own pockets and raised “significant funds” to get the project over the finish line.

The money tap is turned off

But then the nasty surprise: As soon as the hotel was completed, handed over and operational began, the payments dried up. The client stopped the transfers. All attempts at an out-of-court settlement failed. Now there is a gross claim of 3.2 million euros – money that the company urgently needs but is not getting.

The balance sheet shows the full extent of the imbalance: the 7.25 million euros in liabilities are offset by assets of 5.12 million euros. 4.2 million euros are owed to professionals and a further 2.7 million euros to affiliated companies. The rest is attributable to employee claims and provisions.

Hope for the super quota

However, people at Fleissner + Partner don’t want to give up. The company is relying on continuation and an unusual restructuring plan: the creditors are initially offered a cash quota of 20 percent – not very attractive at first glance. But there is a glimmer of hope: a so-called super quota from a trust restructuring.

The idea behind it: The 3.2 million euro claim from the hotel project should be managed in trust and distributed to the creditors when collected. Ideally – if all the money can actually be collected – a 100 percent quota would even be possible. However, the shareholder creditors would then have to step down in rank.

New projects as a lifeline

According to AKV, the company points to several “promising” construction and development projects in which it is involved. One major project in particular – the finalization of a property purchase option – is expected to bring around 586,000 euros into the coffers in the short term and “capacitate the company to capacity in the near future”. In addition, billable services are estimated at 922,000 euros, open claims and credit balances at 4.1 million euros.

It remains to be seen whether this calculation will work. For the 80 creditors and 13 employees, all that remains is an anxious wait and the hope that the defaulting hotel client in Vienna will pay in the end. A traditional Graz company is fighting for its existence. The outcome is uncertain.