The Collective, a small coliving business with locations in New York and London, have appointed Credit Suisse AG to conduct a strategic review, which may result in a full or partial sale of the company. The plan is private, and both The Collective and Credit Suisse did not produce a comment when requested by BNN Bloomberg.
The Collective, which is privately held, was founded in 2010 and appealed to young people who needed affordable housing and wanted to be a part of a community.
The Collective’s current properties in west London, the Docklands District, and Long Island, NY offer guests gyms, co-working space, and libraries, and the Docklands location offers a rooftop swimming pool. Guests are welcome to stay in the apartments for short or long periods of time.
Throughout the past year, some coliving businesses like The Collective have been hit hard by COVID restrictions. Coliving spaces, which appeal to young guests by offering communal spaces and living, have been forced to restrict some of the perks of coliving by limiting guests’ socialisation. In the UK properties, The Collective had to suspend all non-essential bookings, and, today, those who stay at the property can only invite guests in their social bubble.
The company also underwent a management change in the last month, as Simon Koster became CEO and founder Reza Merchant became chairman.
The current value of the company is unknown, but The Collective is reportedly £140 million in debt to lenders, including Deutsche Bank AG, and terms of the loans have been amended twice since the pandemic began. One report said that the company has collected £80 million from the facility. According to another report, The Collective’s accounts are overdue.
Despite these reports, Koster commented on the growth of the company upon being appointed CEO.
Koster said: “I am honoured to accept the role of CEO at The Collective at an exciting moment in its growth, and appreciative of the trust I’ve been given by the entire Board of Directors and our Executive Committee. Reza’s vision has not only created the incredible purpose-led global company that exists today, but also unlocked a new way of living for many people around the world through a pioneering model. My aim is to take the company that Reza has built to the next stage of its evolution and maintain our global leadership position, as we continue to focus on delivering our global pipeline of projects and operating our existing portfolio.”
