Bridging market continues to feel the squeeze as Mathon collapses
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The bridging sector was dealt a blow last week after it was revealed that commercial bridging lender Mathon Finance has been put into administration.
Accountant and business adviser PKF was appointed administrator of Mathon on February 17.
The Glasgow-based lender was established in 2004 as an asset-based lender providing short-term finance to brokers and firms in the commercial property sector.
The company’s remaining assets have been sold to Juniper Property Finance by the administrator, which has secured the jobs of the five employees.
As a result, the administrator received sufficient funds to enable all creditors to be paid in full with statutory interest.
Bryan Jackson, corporate recovery partner with PKF, says the reasons for the failure of Mathon are obvious given the decline in commercial property values over the last three years.
He says: “The firm operated successfully for several years but the drop in values was too great to sustain and consequently made the company unable to continue.
“But all the creditors will be paid and the employees have kept their jobs so it is a welcome result in these difficult economic times and an indication of how useful a pre-pack administration can be in certain circumstances.”
Gary Bailey, director of Blemain Group, says it still has a good appetite for lending in the bridging and commercial markets but Mathon’s exit highlights that the sector has not been immune to the financial crisis.
He says: “We are sorry to hear that Mathon has gone into administration. This shows market condi-tions continue to affect lenders.”
Meanwhile, Drawbridge Finance recently brought some cheer to the sector by expanding distribution to 35 firms, after a soft-launch last April via a small number of companies.
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