Another leading light of the co-living industry is at immediate risk of collapse.

The Collective, a developer and operator of co-living buildings based in the U.K., is on the edge of entering administration, the closest British analog to Chapter 11 bankruptcy in the U.S., React News reports. After hiring Credit Suisse to pursue a potential sale in June but finding no takers, The Collective is approaching financial collapse.

Part of the financial struggles at The Collective (not to be confused with the trade group/private equity fund of Black real estate investors and developers based in Philadelphia) were caused by the coronavirus pandemic's effect on cities, with the company's three operational properties taking major occupancy hits. But other issues are at play.

As the pandemic hit, The Collective had plans underway for major expansion, with seven projects in its London pipeline, one planned in Dublin and five planned in the U.S.: three in Brooklyn, one in Chicago and one in Miami. It only has three projects currently operational and drawing revenue, two of them in London and the other in the Queens neighborhood of Long Island City. The LIC location is focused more on short-term stays.

With quadruple the number of developments in process than completed, The Collective's cash burn rate became increasingly unsustainable as occupancy flagged at its operating properties, React News reports. The company has hired FTI Consulting to guide it through the administration process, in which private equity investors are expected to buy off various parts of The Collective and its holdings.

Among the liabilities driving The Collective to insolvency is a £140M loan from a group led by Deutsche Bank that has already been restructured several times, React News reports. Company founder Reza Merchant, who ceded CEO duties to former JDS Development Group executive Simon Koster after hiring him to lead developments in the U.S. in 2019, still owns 25% to 50% of the company.

No matter the ultimate fate of The Collective, its fall from grace is just one of several examples of co-living being driven to the brink by the pandemic and its aftereffects. WeWork finally pulled the plug on its WeLive subsidiary, which had operated as a sort of redheaded stepchild for years to that point. A local operator in Atlanta pivoted to developing affordable housing projects for community ownership. Quarters abruptly went out of business in January.

One of the only remaining healthy co-living operators, Common, has acquired some of its flagging former rivals and taken over management on properties abandoned by others, but a crucial part of its model is a diversified portfolio that prevents it from being completely dependent on co-living.