Filing Alert: Corvias Chapter 11
Corvias Files Chapter 11 in District of Delaware
Corvias Campus Living - USG, LLC, a Warwick, RI-based student-housing manager and operator for the University System of Georgia ("USG"), filed for Chapter 11 protection on Jun. 25 in the U.S. Bankruptcy Court for the District of Delaware.
The filing is driven by the unsustainability of its public-private partnership with the Board of Regents ("BOR") of the USG for nine student housing campuses, stemming from declining revenues and increasing costs. The debtor states the BOR has not allowed housing fee increases to match market rates or rising costs (including fixed 3% annual rent increases payable to the BOR), and student occupancy has declined. This has led to defaults under the more than $520 million in senior secured notes used to finance the project and an exhaustion of reserves. The Chapter 11 process is intended to provide a "breathing room" to negotiate a comprehensive solution with the BOR and noteholders to right-size the economic terms of the USG Student Housing Program.
The company reports $10 million to $50 million in assets and $500 million to $1 billion in liabilities. The filing indicates that no funds will be available for distribution to unsecured creditors after administrative expenses are paid. The case number is 25-11214.
Top Unsecured Claims
Key Parties
Bankruptcy Counsel:
- Derek C. Abbott
- Morris Nichols Arsht & Tunnell, LLP
- Email: dabbott@morrisnichols.com
Financial Advisor:
- CohnReznick Advisory LLC
Special Counsel:
- Holland & Knight LLP
Signatories:
- Thelma Edgell – President
Claims Agent:
Equity Security Holders:
- Corvias, LLC – 100% Equity Interest
Bondoro Insights is continuing to monitor this case and will provide further coverage as appropriate.
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