Case study Kervale
Case study
Kervale mandates IPEX as a strategic payment platform for the future
IPEX sets new benchmarks for ethical and transparent transfer of project funds from developer to builder, subcontractors and suppliers.
- Kervale
- Victoria, Australia
- Boutique property developer for premium metropolitan and regional residential and commercial developments.
Kervale
About the company
Kervale’s emphasis on ‘relationship building’ has shaped its connection and interaction with clients, builders, subcontractors and suppliers. It has set a new series of ethical benchmarks for relationship management, investment and the delivery of luxury developments. In line with these credentials, it recently reviewed how it moves project funds from Kervale to various builders across multiple construction projects. When considering best practice in ensuring those funds were used to pay the tradespeople and suppliers working on its sites versus being used for other purposes – it realised it needed greater transparency in how builders were delivering project payments to the right people at the right time.
The challenge
Mandating the use of a payment platform with builders
Kervale included IPEX in its business processes in 2021, mandating its use in new tendering contracts. Although there was some initial hesitancy, Kervale’s unwavering commitment to IPEX meant it created a new benchmark for transparent project payments across its business. Builders realised it was a non-negotiable change and Kervale remained committed to transparent monitoring of project payments across all its business partnerships.
The solution
Seamless onboarding leads to 100% project payment transparency
For Rob Moolman, implementing IPEX delivered a wealth of information for the team that could be used for decision-making. Integrating IPEX across live construction sites in Victoria meant clear approval processes with an easy-to-follow dashboard, which led to greater transparency and understanding of financial positions and payments for the Kervale team. The days of reviewing bank statements and matching payments to payees to understand the cash position and status of the project financing are now a thing of the past. Now with IPEX in place, Kervale’s Director of Operations can more easily verify that all conditions for payment have been met before releasing funds.
Once we were aware of IPEX and decided to implement this new standard for project payments, it was a seamless onboarding and end-user experience. It reduces risk and addresses trust and relationship-building in one platform. This will put us in a powerful position as the demand for construction labour increases.
Amplifying the benefits of governance
Kervale attributes its nimbleness and ability to transform or create new processes to the skills of its team and to the fact that the company is a newcomer to the Australian property sector. Its boutique focus has helped it establish strategic social, environmental and governance goals. Kervale aims to enhance the community for clients and create spaces that Melbourne apartment residents may not have experienced before.
It credits its innovative inclusions such as electric vehicle charging stations for each apartment, wine cellars, dog and car washing facilities, dedicated communal-use areas, and sustainable building processes as a differentiator.
For the management team, its reputation for delivering quality outcomes and becoming the developer of choice is needed to ensure the team who started the build could finish the build.
“Risk is always part of any governance discussion, and for us, that risk also included project payment risk. What would happen if the subcontractors weren’t being paid for their work? How might that impact our positions or our projects? How could we improve our processes to ensure those contractors stay in business? The conversation about integrating IPEX was a crucial step to mitigate risk for all stakeholders involved in development projects,” said Rob. IPEX is vital to the accountability of project financing for Kervale’s shareholders, clients, builders and sub-contractors.
It prides itself on creating trust in its working relationships with all stakeholders – helping it establish itself in Victoria ahead of any possible future nationwide expansion. The IPEX platform is compliant with any current state-based project bank account legislation.”
The safety net brought to the market through the new security of payments legislation and project bank accounts provides vital support to workers in the construction sector, and I believe will begin to influence where people elect to work. We want to be across those opportunities ahead of time and be a company that gives workers and contractors that support and creates that trust
Project governance
Rebuilding financial confidence
Attraction of IPEX is the capacity to trace project finances on any project in real-time. This means the management team and clients don’t have to wait a month for accounting software to reconcile project accounts – crucial if anything goes wrong. Today as a builder, it acknowledges IPEX has re-shaped how it completes project payments. It has positively impacted its brand and provided a new level of peace of mind contractors and buyers are seeking.
Using IPEX allows Balmain & Co to examine the financials of a project very quickly. It breaks each project down – overcoming the traditional hurdle of drilling down into one big bank account to check performance – and without paying for software and additional staff to provide answers.
The team believes IPEX holds builders accountable – and this will be key to the financial security of the construction sector. It effectively streamlines payments capabilities and re-invigorates the trust in project payments facilities to allow the industry to grow. In fact, it so strongly believes in the concept it has taken a minor shareholding position with the company.
“Based on our experience IPEX should be mandatory. It is now an integrated and essential part of our governance. It’s delivering a new standard of providing trust downstream to our subcontractors and suppliers that they’ll be paid and upstream to our clients and the financial institutions funding these projects.”
