Urban Commons receives approval of disclosure statement

By Sarah Lizee

Olympia, Wash., April 24 – Urban Commons 2 West LLC received approval of the disclosure statement for its Chapter 11 plan of liquidation, according to an order filed Monday with the U.S. Bankruptcy Court for the Southern District of New York.

The plan confirmation hearing is scheduled for May 16.

The plan provides for the sale of debtors’ hotel lease assets relating to a mixed-use building at 2 West Street, New York, and recoveries, if any, from avoidance actions.

The plan will be funded mainly with available cash, an administrative carveout and litigation proceeds, if any.

Under the plan, $6 million of administrative claims of BPC DIP Lender, LLC, $250,000 of net administrative claims, including professional claims, $5.36 million of secured and administrative claims of the residential board, $14 million of Battery Park City Authority claims and $3.2 million union claims will be paid in full.

U.S. trustee fees, priority tax claims and other priority claims will also be paid in full.

On behalf of its $109.64 million of secured claims, BPC Lender will receive all net cash proceeds from the sale after payment of allowed claims of BPC DIP Lender, all allowed cure claims and the broker fee plus 50% of the litigation proceeds. The balance of these claims will be deemed general unsecured claims for voting purposes, but not for distribution.

Holders of $10 million of general unsecured claims will receive a pro rata distribution from (a) 50% of the litigation proceeds, and (b) available cash remaining after payment of the claims listed above.

Holders of interests may receive a distribution of any available cash after the payment of all claims listed above, but a distribution is not likely.

Urban Commons is a Corona Del Mar, Calif.-based company that modernizes underperforming hotels. The company filed Chapter 11 bankruptcy on Nov. 15 under case number 22-11509.

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