The financial struggles of Charles Cohen’s Cohen Realty Enterprises have taken a new turn with a November 8 auction date set for the properties owned by the company. This includes the U.S. Landmark and UK Curzon arthouse cinema chains acquired by Cohen in 2018 and 2019. The lawsuit filed by Fortress Credit Corp earlier this year against Cohen for defaulting on a major loan backed by Landmark and other assets has put these properties at risk.
The potential closure of Landmark theaters would have a significant impact on the indie film business, which is already facing challenges in recovering from the effects of the Covid-19 pandemic. With the chain losing leases and closing locations in key markets such as Westside Los Angeles, San Francisco, Seattle, and Denver, the future of these theaters remains uncertain. Independent distributors have raised concerns about the upkeep of some remaining theaters but still recognize their importance in the market.
The properties, which serve as collateral for a substantial loan from Fortress, are set to be auctioned off in what could be one of the biggest claims in New York real estate history. The unusual nature of a single large loan being secured by a group of real estate assets has raised questions about the potential outcome of the auction. Despite earlier assurances from a representative of Charles Cohen that the theaters were not in jeopardy, the auction suggests otherwise.
Judge Joel M. Cohen’s decision to proceed with the auction after denying Fortress’s initial petition in June highlights the legal battles surrounding the case. While there was a window for the parties to negotiate a restructuring of the loan, the judge’s decision indicates that this may not be a viable option. As the auction date approaches in November, the uncertainty surrounding the fate of Cohen Realty Enterprises’ properties and the Landmark theaters persists.
Amidst the turmoil in the exhibition industry, there have been notable shifts and deal-making activities. Sony’s recent acquisition of Alamo Drafthouse and the interest of larger chains like AMC and Cinemark in strategic theater leases demonstrate the evolving landscape of the industry. The potential auction of Cohen Realty Enterprises’ properties adds another layer of complexity to the industry’s current dynamics.
The upcoming auction of Cohen Realty Enterprises’ properties, including the Landmark theaters, signifies a significant development in the real estate and exhibition industries. The challenges faced by independent film businesses and the uncertainties surrounding the auction highlight the importance of strategic decision-making and adaptability in a rapidly changing environment.