Three Starcity Entities File Chapter 7 Bankruptcy
After coliving company Common bought out San Francisco-based startup Starcity, three legal entities associated with Starcity filed for Chapter 7 bankruptcy.
Starcity Properties Inc, the largest of the three entities, had assets worth $ 3.2 million and liabilities of $ 9.9 million, of which $ 5.6 million was secured by claims related to goods.
“The purpose of filing the Starcity entities was to allow for their orderly liquidation by a single trustee,” said Wendy W. Smith, partner at Binder & Malter LLP, which represents Starcity subsidiaries. “This trustee will consider whether, under the rules of the bankruptcy code, there is sufficient asset value in light of creditors to justify the sale of the various interests in the developments and properties.”
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The deposits arrived just after it was reported that Starcity’s coliving project in downtown San Jose, which would have become the largest coliving building in the world, would not be among the assets sold and became past due on a 2019 $ 14.7 million loan.
Last June, Starcity transferred property management agreements for 7,500 units to Common. After that Common hired new employees, including co-founder and former Starcity CEO Jon Dishotsky, but as of this week Dishotsky said he was no longer employed at Common.