The Capital Link Investigates Statements Regarding Mischaracterizations in Bisnow’s Coverage of LuxUrban Hotels
New York, NY, Oct. 24, 2025 (GLOBE NEWSWIRE) -- At The Capital Link we announced an investigation into reviewing the public record of LuxUrban Hotels Inc. (the “Debtor”) before the United States Bankruptcy Court for the Southern District of New York, we think the following clarification concerning Bisnow’s Deputy Dip Ethan Rothstein’s article dated October 23, 2025, titled “LuxUrban Hotels To Liquidate As Bankruptcy Claims Surpass $123 Million.”
The story blends creditor rhetoric with fact, misstates who initiated the Chapter 7 conversion, and omits critical procedural history that the court docket makes plain.
Summary Table – Misstatements vs. Documented Facts
| Bisnow Claim | Factual Record (Court Filings & Official Documents) |
| “Lenders forced LuxUrban into Chapter 7 liquidation.” | The conversion was initiated by the U.S. Trustee and consented to by the Debtor itself. See Debtor’s Consent to Conversion to Chapter 7 filed Oct 18 2025 and Order Granting Conversion (Dkt. 84, Case No. 25-12000, Bankr. S.D.N.Y., Judge David S. Jones). |
| “LuxUrban ceased operations and abandoned its hotels.” | No court order has declared an enterprise-wide shutdown or abandonment. The Oct 21 Order merely transfers control of estate property to the Chapter 7 trustee under 11 U.S.C. § 701 et seq. |
| “Hazardous conditions left behind at The Herald Hotel.” | These statements derive from creditor pleadings (Dkt. 63) – allegations, not judicial findings. No court has adopted them as fact. |
| “$118.6 million owed to the New York State Department of Taxation and Finance.” | That figure reflects a proof of claim filed Oct 8 2025 – an asserted liability subject to objection and allowance under 11 U.S.C. § 502. It is not an adjudicated debt. |
| “LuxUrban was found to be booking rooms while hotels were closed.” | The U.S. Trustee’s emergency motion (Dkt. 71) cited media reports; no court has entered findings of fraud or misconduct. |
Chronology and Procedural Clarifications
- Voluntary Chapter 11 Filing (Sept 14 2025): LuxUrban filed voluntarily under Chapter 11 to restructure its lease portfolio and stated in its Form 8-K (SEC File No. 001-41421) that it intended to continue operations as a debtor-in-possession under 11 U.S.C. §§ 1107–1108.
- Joint Administration (Sept 16 2025): The Court approved joint administration of related affiliates (Dkt. 12) – routine procedure, not “collapse.”
- U.S. Trustee Motion (Oct 10 2025): The U.S. Trustee filed an emergency motion (Dkt. 71) to appoint a trustee or convert to Chapter 7.
- Debtor’s Consent (Oct 18 2025): LuxUrban filed a formal consent to conversion (Dkt. 79), agreeing that liquidation under Chapter 7 was the most efficient path for stakeholders – a fact omitted by Bisnow.
- Conversion Order (Oct 21 2025): Judge David S. Jones entered the Order Converting Case to Chapter 7 and appointed Kenneth P. Silverman as trustee (Dkt. 84). The Order contains no finding of misconduct or negligence.
- 341 Meeting Notice (Oct 23 2025): The trustee issued a creditors’ meeting notice for Dec 2 2025 (Dkt. 91). The claims register shows approx. $123.6 million in asserted claims – a fluid figure pending allowance or objection.
Corrective Observations
- Who Drove the Conversion: The claim that “lenders and landlords forced a liquidation” is flatly contradicted by filings. The U.S. Trustee initiated the motion, and the Debtor agreed and recommended conversion to avoid further expense and delay.
- Allegations ≠ Findings: All references to “hazardous conditions,” “abandonment,” or “continued bookings” stem from pleadings and press speculation – none are judicial findings.
- Claims ≠ Liabilities: Proofs of claim are assertions, not debts. No agency claim has been allowed or reduced to judgment.
- Procedural Integrity: LuxUrban has complied with Bankruptcy Rules 1015 and 1007, filed all required schedules, and maintained counsel throughout.
Investor Litigation Reality Check
The separate Pack v. LuxUrban Hotels Inc. civil case (1:24-cv-01030, S.D.N.Y.) is currently stayed under 11 U.S.C. § 362 due to the bankruptcy. Despite claims to the contrary, no trial date exists and no class has even been certified. The lawsuit remains a putative (proposed) class action – a procedural limbo that hasn’t even cleared its first hurdle. Yet some commentators breathlessly speculate about a “2027 trial,” a prediction that’s about as accurate as forecasting a jury verdict on a case that hasn’t made it past orientation. In plain terms: there is no certified class, no trial calendar, and no verdict on the horizon – only paperwork.
Closing Statement
The legal record tells a far more nuanced story than the sensationalized version printed by Bisnow’s Deputy Dip Ethan Rothstein. The Debtor’s own consent to conversion, the absence of judicial findings of misconduct, and the pending status of every major claim stand in stark contrast to headlines implying collapse through external force.
The Capital Link welcomes continued media interest – provided future reporting adheres to the facts actually on file. Accuracy, after all, remains the most reliable form of entertainment.
Contact:
media@thecapitalink.com
Sources: U.S. Bankruptcy Court S.D.N.Y. Case No. 25-12000 (Dkts. 12, 63, 71, 79, 84, 91); SEC Form 8-K (Sep 14 2025, File No. 001-41421); Pack v. LuxUrban Hotels Inc., 1:24-cv-01030 (S.D.N
CONTACT: Mariana Brodsky mariana(at)thecapitalink.com
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