Brooklyn Mirage to Be Sold for $110 Million in Bankruptcy Deal
The sale order allows Avant Gardner to demolish and reconstruct the Brooklyn Mirage structure, with tear-down costs estimated at approximately $1.5 million.
A federal bankruptcy judge has reportedly approved the sale of Avant Gardner, the company behind the beleaguered Brooklyn Mirage venue and ill-fated Electric Zoo festival, to its primary lender for at least $110 million, bringing an end to a tumultuous chapter for one of New York City’s most prominent EDM venues.
Judge Mary F. Walrath of the United States Bankruptcy Court for the District of Delaware approved the credit bid from AG Acquisition 1 LLC, an affiliate of Axar Capital Management LP, Bloomberg Law reports. The transaction includes the forgiveness of pre-bankruptcy secured loans and $45.8 million in bankruptcy financing, according to court records.
The approval marks a turning point for the 80,000-square-foot East Williamsburg complex, which has been shuttered since its parent company filed for Chapter 11 bankruptcy in August with $155.3 million in debt. Avant Gardner cited persistent building issues and operational setbacks stemming from an ambitious $30 million renovation as factors preventing it from reopening the Mirage. Following contentious permit disputes and safety inspection failures, the venue’s proprietors ultimately ousted embattled CEO Josh Wyatt and replaced him with the influential nightlife entrepreneur Gary Richards.
The sale order allows Avant Gardner, in consultation with the buyer, to demolish and reconstruct the Mirage structure, provided the buyer makes additional funding available. A demolition permit filed this month with New York City estimates tear-down costs at approximately $1.5 million.
Judge Walrath also approved a settlement between Avant Gardner, a committee of unsecured creditors and the lenders, calling it a “very good deal” for unsecured creditors. Under the agreement, the lender will reportedly cover substantial priority and administrative claims and fund expenses for a liquidating trust.
“This is a remarkable settlement and in the best interest of the estate,” Judge Walrath said at the hearing.
