Special Situations Advisory
Stabilise. Solve. Execute.
Credit fund advisory for stressed and complex situations.
About your recovery partner
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Capital preserved
We protect fund capital and maximise recovery on stressed exposures.
Decisions accelerated
We mobilise quickly. Triage, strategy and execution in compressed timeframes.
Control retained
We work alongside fund managers to preserve control of liquidity, redemptions and investor outcomes.
Private credit has scaled. So has the complexity of the situations that arrive when borrowers stop performing.
Special Situations Advisory is a dedicated practice for credit fund managers and non-bank lenders managing liquidity pressure, defaulted loans, covenant breaches and stressed portfolio exposures. We work directly with fund managers, investment committees and workout teams to triage risk, restructure positions and execute outcomes that protect capital and stabilise portfolios.
We act in the moments that matter, when timing, judgement and decisive execution determine whether capital is preserved or lost.
When to engage us
If your fund or portfolio is exposed to any of the following, the time to engage is now.
- Fund-level liquidity pressure or gated redemptions: Investor outflows running ahead of asset realisations.
- Borrower defaults or escalating arrears: Payment failures across one or more facilities.
- LVR breaches and valuation-driven covenant stress: Security values falling against drawn balances.
- Concentrated or underperforming exposures: Single-asset or single-borrower risk dominating the portfolio.
- Refinancing risk across portfolio assets: Facilities approaching maturity without a clear takeout.
- Need for active intervention or workout strategy: The position can't be held passively.
Core Services
We work across five core service lines, scoped to the situation and the fund's strategic priorities.
- Portfolio Stress Review
A rapid assessment of fund exposures to identify high-risk positions and prioritise action. Output: a triaged risk map and recommended intervention sequence.
- Independent Business Reviews (IBR)
Detailed financial and operational review of borrowers under stress. We assess viability, downside protection and recovery scenarios, supporting decisions on standstill, restructure or enforcement.
- Workout & Enforcement Strategy
Strategy and execution across the full workout pathway. Standstill arrangements, consensual restructures, formal restructuring options, and enforcement where it delivers the better recovery.
- LVR & Covenant Reset Strategies
Restructure positions to restore covenant compliance through facility variation, equity injection, asset sales, or coordinated lender action.
- Distressed Exit & Recovery
Where the position cannot be held, we run accelerated sale or recapitalisation processes designed to maximise recovery in compressed timeframes.
Our Process
Triage
We assess the exposure or portfolio quickly and identify where capital is most at risk. The objective in this phase is clarity, so what we're dealing with, how urgent it is, and where decisions need to be made first.
Diagnose
Detailed financial, security and operational review. Where the situation involves a borrower, this is typically delivered as an Independent Business Review. Where it involves multiple positions, it's a portfolio-level diagnostic.
Strategise
We develop the workout strategy with you by either a standstill, restructure, asset sale, recapitalisation or enforcement. The strategy direction is calibrated to recovery, timing and the fund's liquidity position.
Execute
We execute alongside the fund, project-managing counterparties, advisors and process. We stay engaged through completion to ensure that capital preservation is delivered, not just the strategy paper.
What we deliver
- Preservation of capital: Across stressed and defaulted exposures.
- Prioritised action: A clear sequence of where to act first across complex portfolios.
- Speed: Execution measured in weeks, not quarters.
- Liquidity alignment: Recovery strategy structured around fund redemption and capital cycles.
Our Work
Fund liquidity restored: $40m credit fund
A credit fund was facing redemption pressure with multiple underperforming loans across the portfolio. We triaged the portfolio, prioritised exits and executed accelerated sales across three assets. Liquidity was restored and redemptions partially reopened within eight weeks.
Multi-asset workout: $35m portfolio
Multiple borrowers in a single fund were breaching covenants, creating systemic portfolio risk. We implemented a coordinated workout strategy and lender-led restructuring across the affected positions. The portfolio was stabilised and enforcement-led losses were avoided.
Borrower recapitalisation: Defaulted facility
A borrower default and material valuation decline triggered an LVR breach against a single-asset facility. We restructured the facility and negotiated a recapitalisation alongside a partial asset sale. The covenant position was reset and capital was preserved with minimal loss to the lender.
Turning a Defaulted Coastal Resort Loan Into a $250M Real Estate Play
A private lender faced a critical decision after a beachfront resort defaulted on a $33M loan, with $22M in exposure and an effective LVR of 200% on land value alone.
The Challenges
- Borrower defaulted with the lender holding $22M exposure on a $33M loan.
- LVR sat at 100% on resort and land value, blowing out to 200% on land value alone.
- The lender had extended too much leniency, leaving limited options on the table.
- A public sales campaign failed to attract any acceptable offers.
The Outcome
Mackay Goodwin advised against a distressed exit and identified a higher-value pathway. By reinvesting and selling the beachfront land in parcels rather than the resort as a whole, the lender was positioned to pursue a circa $250M real estate play on prime coastal real estate.
Why Mackay Goodwin
The Special Situations Division brings together ASIC-registered liquidators, restructuring specialists and workout practitioners with a single focus: protecting fund capital in time-critical and complex situations.
We are independent. We act for the fund, not the borrower, and we are positioned to take formal appointments where strategy converts to execution.
We are fast. Our team is structured to mobilise within days, not weeks, and we run workouts to a project timetable that reflects the realities of fund liquidity and investor reporting cycles.
We are national. Mackay Goodwin operates across Sydney, Melbourne, Brisbane and Perth, supporting credit funds with exposures across every Australian jurisdiction.
FAQs
Restructure & Turnaround is delivered to companies and their directors. Special Situations Advisory is delivered to lenders and credit fund managers, the capital side of the same situations. The lens, the strategy and the deliverable are different.
Private credit funds, non-bank lenders, mortgage and unitised credit trusts, family offices and high-net-worth private lenders. We also advise investment committees and workout teams within larger fund managers on a project basis.
No. We assess conflicts at engagement and decline where independence is compromised. Where a related party of the borrower has been a client, we apply the ARITA Code of Professional Practice independence framework before accepting the engagement.
A senior team can be in the matter within 48 hours of engagement for urgent situations, with a triage view typically delivered in the first week.
An IBR is a detailed financial and operational review of a borrower under stress, prepared for the lender. It assesses solvency, going-concern viability, downside recovery scenarios and the practical strategy options available. This includes standstill, restructure and enforcement pathways.
A standstill is a temporary forbearance agreement in which the lender suspends its enforcement rights while the borrower implements a defined plan. A restructure varies the underlying facility's covenants, terms, security, or capital structure to a position the borrower can perform against. Enforcement is the realisation of security to recover the debt. The right pathway is fact-specific. We help you choose, and then we execute.
A confidential conversation. Same day.
If your fund is exposed to a stressed position, the cost of waiting is rarely small. Speak with our Special Situations team today, and we will assess the situation, identify priorities, and outline the available options.
Get in touch
Speak to one of our experts now for a free consultation. Enter your details below or call 02 8001 6520.