Brian Ferdinand, Founder Of Collapsed Hotel Chain, Files For Bankruptcy

Months after LuxUrban Hotels’ chaotic bankruptcy left guests stranded on the streets of New York City, the company's founder and former CEO is now also bankrupt.

Brian Ferdinand filed for Chapter 7 personal bankruptcy in the Eastern District of New York on Dec. 2, claiming less than $4.5M in assets and over $98M in liabilities, according to his bankruptcy petition.

The majority of the liabilities stem from personal guarantees he signed on behalf of LuxUrban to secure master leases for New York City hotels the company operated. He owes $28M to MAve Hotel Investors, the landlord of Hotel 27 on Madison Avenue, $6.4M to the owner of The Herald at 71 W. 35th St., and $14.2M to the landlords of the Tuscany Hotel, according to the filing.

Ferdinand also owes the Internal Revenue Service $148K in unpaid taxes from 2023. 

Marc Pergament, a partner at Weinberg, Gross and Pergament LLP and Ferdinand’s bankruptcy attorney, declined to comment. Ferdinand didn't respond to a request for comment.

The filing paints a picture of a now-penniless executive who put his personal fortune on the line to fuel the growth of his hotel company that his executive team once boasted could compete with Marriott and Hilton. 

But that business has now collapsed, and it has taken its founder down with it.

In the filing, Ferdinand claims he is unemployed and taking in no salary. He lists three bank accounts with a total of $169.69 between them. He disclosed that his 2023 Porsche Cayenne was repossessed last year and that he's receiving a $30K monthly allowance from his father.

His largest asset is a condominium in Sunny Isles Beach, Florida, valued at $4.4M, although he has two mortgages tied to the apartment for a combined $5.7M. 

He also owes Wyndham Hotel Group $19M, according to the filing, for a failed deal it struck with LuxUrban. He is on the hook for a $2.7M judgment after LuxUrban defaulted on its lease for the hotel at 123 Washington St. — another transaction he personally guaranteed.

Other creditors include affiliate of investors Infinity Collective, which he owes $2.7M, four advance lending firms with claims totaling $3.9M, and two reputation management firms, which he owes $35K in total.

Ferdinand disclosed that he was sued 18 times in the year before he filed for bankruptcy, with the vast majority of the lawsuits over breaches of loan or lease guarantees.

Ferdinand founded CorpHousing Group in 2017, leasing apartment buildings and offering them as short-term rentals. During the pandemic, he led the company's pivot to master leasing hotels, culminating in a $13M initial public offering in 2022 and a new brand: LuxUrban Hotels.

He remained CEO until 2024, when he stepped down following a January 2024 short seller report that highlighted a series of lawsuits against the company and that raised questions about its financial reporting.

Ferdinand also resigned as chairman later that year, only to cycle in and out of chairman and interim CEO roles in the months since as newly hired executives came and went. Throughout, he remained the company's largest shareholder.

Last year, LuxUrban was sued by the New York City government over a check — to pay part of a $1.2M fine for illegally operating short-term rentals as CorpHousing Group — that bounced when the city tried to cash it. 

Only four months later, after Ferdinand had again relinquished all of his leadership roles, LuxUrban filed for Chapter 11 restructuring on Sept. 15.

While LuxUrban initially filed to restructure and stay in business, it stopped paying its workers and shuttered the hotels anyway. In the days following, it became clear that LuxUrban hadn’t stopped taking bookings, leaving guests with nowhere to go when they showed up outside shuttered hotels where they had made reservations.

A lender on the Herald hotel — which is pursuing foreclosure after its owners couldn’t pay the property’s mortgage in part because LuxUrban skipped on rent — said the hotel had “mounting safety issues, persistent leaks, accumulating garbage, and other pressing security concerns.” 

Department of Justice attorneys filed an emergency motion asking the court to appoint an independent trustee to take over the bankruptcy, citing “gross negligence” by management and safety concerns for consumers and workers.

LuxUrban converted its Chapter 11 bankruptcy to a Chapter 7 liquidation just weeks later on Oct. 21.

“This seems like a kind of firestorm mess,” Andrew Gottesman, head of Rosenberg & Estis' restructuring and bankruptcy practice, who isn’t involved in the case, told Bisnow at the time.

Ferdinand’s departure meant he wasn’t named in LuxUrban’s initial Chapter 11 or its Chapter 7.

But this week, he was dragged back into the company’s legal proceedings when the case’s court-appointed trustee, Kenneth Silverman, filed a motion to make Ferdinand responsible in the company’s liquidation case.

Silverman’s request, which needs to be approved by a judge, followed court testimony from LuxUrban’s chief restructuring officer that “only Ferdinand would be capable” of producing the financial documents needed to resolve the case.

Ferdinand and LuxUrban's bankruptcy cases are also taking place alongside a separate class-action lawsuit that claims LuxUrban and Ferdinand defrauded investors by claiming to have executed leases at hotels when the deals were only pending. The lawsuit is in the discovery phase.