The company, M Fitzgibbon Builders Ltd, Ennis, Co Clare, began work on the integrated services central building, in the Mitchels area of the Kerry town, last October.
Jim Luby of McStay Luby has now been appointed receiver and manager of the company by Danske Bank.
Work came to a halt on the site on Mar 5.
A council spokesman said M Fitzgibbon Builders will not complete the project and the site has been returned to the Mitchels Integration Services Company.
A bond will be called in and the council will be dealing with the bond company. The spokesman said the council was not sure as to what would happen next and the project may have to go to tender again.
He stressed finances backing the project were in place and any fees paid out so far were for work completed.
The council has also been adamant there is sufficient money to complete the project.