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A New York State Supreme Court judge set a November 8 auction date for properties owned by Charles Cohen’s Cohen Realty Enterprises, including the U.S. Landmark and UK Curzon arthouse cinema chains he acquired in 2018 and 2019.
Fortress Credit Corp. sued Cohen earlier this year for defaulting on a large loan backed by Landmark and other assets.
If Landmark shutters, it would be a big blow to an already challenged indie film business still working its way back from Covid. Since then, the chain has lost leases and closed locations including its most important, the Westside Los Angeles theater, and in San Francisco, Seattle and Denver.
Independent distributors have tended to gripe about upkeep at some of the theaters that remain. But a handful of execs Deadline has spoken with about this are quite unhappy at the possibility of losing them. “It’s market to market, but there are still theaters that really perform in that chain. It’s definitely bad if they go away,” says one.
The properties, which also include a big design center, office tower and hotel, were collateral on $534 million in loans from Fortress. If the auction does move ahead, it would be one of the biggest Uniform Commercial Code (UCC) claims in New York real estate history.
It is also somewhat unusual to have a single large loan secured by a group of real estate assets, said a person familiar with the case.
In a statement to Deadline earlier this summer, a representative for Charles Cohen said the theaters were not in jeopardy and would continue to support independent film. He wasn’t immediately available for comment Tuesday.
Judge Joel M. Cohen agreed to move ahead with the auction after denying Fortress’ first petition in June on technical grounds. The group resubmitted the request in July and it was granted last week. The judge denying Cohen’s renewed request for a preliminary injunction as well as its request to move the auction date later, into the fourth quarter. The judge initially had given the parties time to reach an agreement on restructuring the loan but said that looks unlikely to happen.
November is still months away so an agreement, while unlikely, is not out of the question.
There has has been deal movement in exhibition. Sony recently acquired Alamo Drafthouse, and bigger chains from AMC to Cinemark have been cherry-picking leases of theaters they like in strategic locations, but rarely looking at entire circuits.