Chicago-based CA Ventures faces mounting troubles as its European student-housing platform enters creditors’ voluntary liquidation.
The platform, which managed 7,000 beds and held planning permissions for another 5,000, has been deemed financially unsustainable after a failed rescue package, Green Street News reported.
Efforts to salvage the European operations nearly succeeded, with former Chief Investment Officer John Diedrich spearheading a plan to secure a $101 million capital injection from Bahrain’s GFH Financial Group. That would have provided working capital and growth funding for a new, independent entity.
The deal would’ve included full ownership of Novel Student, CA’s European operating platform, while separating the European business entirely from CA Ventures’ troubled U.S. arm. Despite advanced negotiations, the agreement unraveled, leaving creditors with few options.
The difficulties in Europe mirror ongoing legal challenges in the U.S. Last month, a lawsuit was filed in Cook County accusing CEO Tom Scott of misusing $14 million from development loans to cover personal debts. Scott previously told The Real Deal that the claims were “outrageous.”
The developer recently sold a 25-unit property in Chicago’s Lincoln Square to Breneman Capital after missed payments and a foreclosure lawsuit.
Additionally, the firm is embroiled in multiple lawsuits, including one filed by Goettsch Partners, which claims the developer owes $1.7 million for work on a failed project in Austin. CA Ventures is also managing $75 million in delinquent loans on senior housing facilities in Overland Park, Kansas, and two others in suburban Chicago.
In 2022, CA Ventures sold an 897-bed UK student housing portfolio to Apollo Global Management for the equivalent of $204 million, equating to approximately $227,400 per bed.
To mitigate the CA’s fallout across the pond, the company’s joint European partner, Harrison Street, has transitioned property management to Mezzino Student Living.
— Andrew Terrell
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