Co-Living Firm's Brooklyn Site Put Up For Auction By Lender
British co-living company The Collective may lose its Brooklyn development site amid the company’s financial woes.
Lender Acres Capital initiated a foreclosure on 1215 Fulton St., which The Collective purchased in 2019 for about $33M with plans to turn it into one of its first locations in the United States, The Real Deal reports.
The Collective has reportedly failed to make payments on a loan secured by the property; Acres backed two loans to the British firm run by CEO Reza Merchant when it bought the land, one for $26.7M and another for $4.4M per TRD.
The co-living firm was supposed to start construction in 2020 on the site of the since-demolished Slave Theater and deliver in 2022, with development set to cost $260M, according to Architect Magazine. The building was set to have 87 apartments and 249 hotel rooms in a 2019 filing, New York YIMBY reported.
In September, The Collective fell into administration, the UK version of a Chapter 11 bankruptcy, after facing financial troubles brought on by low occupancy rates amid the coronavirus pandemic, Bisnow previously reported. It is one of several co-living locations to either close or be taken over by competitors.
It recently defaulted on another Brooklyn site in Williamsburg at 555 Broadway, where it fell behind on payments on a $49M mortgage from Gamma Real Estate.