Tillary Hotel owner files bankruptcy; cites shutdown, low occupancy

By Sarah Lizee

Olympia, Wash., Dec. 21 – 85 Flatbush RHO Mezz LLC, the owner of the Tillary Hotel in Brooklyn, N.Y., filed Chapter 11 bankruptcy on Friday in the U.S. Bankruptcy Court for the Southern District of New York.

“The Covid-19 pandemic and the attendant travel restrictions and quarantine requirements along with the N.Y.C. shutdown of indoor dining beginning in March 2020 had an immediate impact on the hospitality industry as a whole and caused the hotel to shut down operations entirely for the month of April 2020,” David Goldwasser, chief restructuring officer of the company, said in a declaration.

Goldwasser said the hotel reopened to provide homeless shelter services from May 15 through June 30.

The hotel reopened to the public on July 15 and remains open, but with a substantially reduced occupancy rate, resulting in limited revenue.

As a result, the company hasn’t been able to pay its current debt service obligations to its secured lender. The lender gave the company notice that it intends to force an asset sale.

The company is seeking court approval to use the cash collateral of 85 Flatbush Avenue 1 LLC. Currently, the debtor has insufficient cash, absent use of the cash collateral, to meet its ongoing obligations necessary to maintain and operate the hotel, according to a motion filed Sunday.

The company listed $50 million to $100 million in both assets and liabilities.

It did not list any unsecured creditors with claims of $1 million or more.

The Tillary Hotel is a boutique hotel in Brooklyn, N.Y. The Chapter 11 case number is 20-23280.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.