There is a saying about the best plans.
Joel Schreiber — known as the first investor in We work — bought the old one Broadway Mall in downtown Los Angeles in 2014 with a joint venture, and has since announced various plans for its transformation: from a massive creative office redevelopment to “the world’s largest physical metaverse hub.” But none succeeded.
Now Schreiber has filed a Chapter 11 petition in New York bankruptcy court ahead of a planned foreclosure sale after the lender Starwood refused to grant an extension for $214 million in debt for good, The real deal reported.
“The ramifications of the COVID-19 pandemic over the past few years have weighed heavily on planned development,” Schreiber wrote in the petition. “Despite the obvious challenges, the debtor still believes strongly in ownership and has chosen to commence this Chapter 11 case to prevent an immediate foreclosure and obtain a final opportunity to salvage the project.”
The historic 1.12 million square foot property is completely vacant and occupies half a city block in 801 South Broadway, just two blocks from Pershing Square. by Schreiber Water Bridge Capital acquired the property with Continental Actions for $122.3 million in August 2014, and secured rights to 624,500 square feet of office and 345,000 square feet of retail space, as well as more than 100 hotel and residential rooms. The owners also tried to sell the property several timeswith past off-market listings showing that Broadbridge had requested $425 million.
Earlier this year, the owners said they found a buyer with a tech startup master of ceremonieswho had his ambitious projects to support a new metaverse platform, as well as a new hotel and coworking space. But this plan was not mentioned in the bankruptcy petition, according to TRD.
Gregory Cornfield can be reached at [email protected].