Co-living startup The Collective to lose another Brooklyn development project

UCC auction for site of Bed-Stuy’s Slave Theater scheduled for Dec. 15

New York /
Nov.November 22, 2021 11:00 AM
The Collective's Reza Merchant and 1215 Fulton Street in Bedford-Stuyvesant (NLA, The Collective)

The Collective’s Reza Merchant and 1215 Fulton Street in Bedford-Stuyvesant (NLA, The Collective)

The former site of Brooklyn’s historic Slave Theater, once slated for a co-living facility designed by architect Sou Fujimoto, is headed to foreclosure.

Co-living startup The Collective has fallen behind on loan payments backed by its equity in the vacant one-acre property at 1215 Fulton Street in Bedford-Stuyvesant, according to a public notice.

An entity owned by Long-Island based lender Acres Capital has initiated a UCC foreclosure auction for the startup’s interest in the parcel, according to the notice, which did not specify the amount of the loan or how much The Collective allegedly owes. The auction is set for Dec. 15.

Acres declined to comment. The Collective, Mannion Auctions, which will be conducting the foreclosure auction, and Newmark’s Brock Cannon, who is handling the bidding process, did not respond to requests for comment.

Acres also provided The Collective with two mortgage loans backed by the property: A $26.7 million senior mortgage and a $4.4 million supplemental loan, according to public records. Both were issued in February 2019, when The Collective purchased the site for $32.5 million.

Founded by young entrepreneur Reza Merchant in 2010, the U.K.-based startup grew rapidly into a $1 billion dollar business, but struggled through a decline in occupancy during the pandemic. The company unsuccessfully sought a buyer before falling into administration — a legal protection similar to bankruptcy in the U.S. — in September, Bloomberg reported.

The vacant site formerly housed the historic Slave Theater, a movie theater that became a hub for civil rights activists, including Al Sharpton, in the 1980s and 1990s before it was demolished in 2016. Upon acquiring the property three years later, The Collective stated that it would honor the site’s history with its proposed 150-unit development, which was later enlarged to include 336 residential and hotel units, according to filings.

The Collective is also set to lose its 500-unit flagship development at 555 Broadway in Williamsburg after falling behind on its mortgage payments, according to sources.





    Related Articles

    arrow_forward_ios
    From left: Starwood Capital’s Barry Sternlicht and Veracity Development’s Edmond Li along with 111 Mercer Street (Getty, Google Maps, Veracity Development)
    Sternlicht’s LNR aims to foreclose on Veracity’s Soho condo
    Sternlicht’s LNR aims to foreclose on Veracity’s Soho condo
    Seth Weissman, Financing
    Urban Standard wants to rescue property owners from high interest rates
    Urban Standard wants to rescue property owners from high interest rates
    From left: Michael Dell with 25 Water Street, Alex Sapir with 261 Madison Avenue and Marc Holiday with One Madison Avenue (Getty, Edge Funds, Sapir Organization, SL Green)
    Office properties (yes, office!) got Manhattan’s biggest December loans
    Office properties (yes, office!) got Manhattan’s biggest December loans
    Salim Assa with 15 West 55th Street
    Troubled Midtown rental saga headed for a foreclosure finale
    Troubled Midtown rental saga headed for a foreclosure finale
    Rendering of 640 Columbia Street in Red Hook, 9-11 Metrotech Center and TerraCRG's Ofer Cohen
    Brooklyn boasted $9B in investment sales last year
    Brooklyn boasted $9B in investment sales last year
    188 Nelson Street and 483 13th Street
    Zero deals signed for $4M homes in Brooklyn last week
    Zero deals signed for $4M homes in Brooklyn last week
    From left: 346 Kent Avenue, 30-77 Vernon Boulevard, and 1 Java Street (Getty, SHoP Architects, James Corner Field Operations, Lendlease, NYC Department of Housing Preservation and Development)
    Multifamily leads big month for outer-borough loans
    Multifamily leads big month for outer-borough loans
    160 Imlay Street and Living New York's Devin Someck with Fredrik Eklund and John Gomes
    Living New York bumps Eklund-Gomes off Red Hook project
    Living New York bumps Eklund-Gomes off Red Hook project
    arrow_forward_ios

    The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

    Loading...