Downtown sale occurs after the passing of Prodigy Network’s Rodrigo Niño.
Crowdfunding company Prodigy Network had to sell one of its commercial assets at a loss of 10 million dollars. This pushes the company in further uncertain waters, as well as investors.
Prodigy Network had to sell 114 East 25th Street for just over 40 million dollars. The building holds the co-working area ‘The Assemblage’ which the troubled firm helps run. They first bought the property for over 50 million dollars back in 2016, and borrowed 35 million dollars for the occasion. Investors had to fund the venture with a min. of $50K, a glance at Prodigy’s site reveals.
The company has been in trouble for quite a while. It owns a handful of commercial assets in NYC and ceased paying distributions to investors in the second half of 2018, putting the blame on poor performance. In an update that went out to investors in 2019, the enterprise said that the 12-story building couldn’t meet its debt obligation.
Adding to their heap of problems, Prodigy’s leadership situation is not entirely clear. The founder, Rodrigo Niño, established the venture in 2013, but left his post in 2019 as legal and financial problems kept on happening. Not long after that, he sent out a note to investors regarding his cancer diagnosis and, following treatments in NYC, he unfortunately passed away at just 50 years of age. There was no announcement regarding a new chief executive officer.
The CFO, Carey Fieldcamp, and development partner, Larry Davis of Shorewood Real Estate Group, could not be reached for comments regarding the newest development. Jeffrey Miller, a Uniondale attorney representing the LLC that purchased the building in question was likewise unavailable.
Prodigy’s co-working space intended for events, too, has another NYC location. They highlighted their wellness aspects of their operations. Their Twitter account posted ads about working on your breathing, dissolving fear, etc.
The founder was a former property broker and one of the first who dabbled with crowdfunding, thinking that it could help everyday people venture into CRE investing. He was known for his work ethics and worldwide network, thus raising almost 700 million dollars from investors over the globe in order to finance developments from NYC all the way to Chicago and his native country of Colombia.
Yet his plans for Prodigy and estimated profits were not as expected. As distributions ceased in late 2018, investors became worried about the state of the firm. Some lawsuits followed.
At the beginning of 2020, investors got some info from behind the scenes, as they got letters from Prodigy asking for cash to help keep a couple of commercial assets in its possession. The announcement let it be known that if the financial goal was not met, investors would end up losing all that was put in.
Yet the letters barely dissolved the fear of people who risked their cash.
As one South American investor put it, there is doubt all around and he would not be putting any more money into Prodigy’s venture.