Australian private credit manager CVS Lane has temporarily suspended investor applications and redemptions across two funds after revealing significant exposure to the collapsed property developer Bathla Group, according to a report by ABC.
The move adds to growing liquidity concerns in Australia’s private credit market, where a number of managers are coming under pressure to balance investor withdrawal requests against the need to protect remaining investors.
CVS Lane told investors that its First Mortgage Fund and Property Finance Fund had exposure to Bathla through nine separate loans. The firm manages approximately AUD2.1bn across its investment platform.
The suspension covers both new applications and redemption requests. CVS Lane said the decision was intended to protect investors collectively while administrators assess Bathla’s financial position and lenders establish the most appropriate course of action.
The manager is expected to provide investors with a further update next week and reassess the suspension by the end of October.
Bathla Group, one of Sydney’s major residential developers, entered administration this week following months of financial pressure. The group is understood to have more than AUD3.5bn in liabilities.
Administrators from Teneo have been appointed to Universal Property Group, the group’s principal corporate entity, as well as Raj & Jai Construction, a company linked to Bathla.
Around 40 private credit funds are understood to have exposure to Bathla, with individual lenders’ positions ranging from approximately AUD1.5m to AUD340m.
The scale of those exposures means the administration process is being closely watched across Australia’s private credit industry, particularly by managers whose funds offer regular liquidity to investors.
