Besieged by creditors, developer Craig Cohen filed for personal bankruptcy protection this month, the latest fallout from the troubled redevelopment of the Schmidt Brewery’s keg house on West Seventh Street into the Keg and Case marketplace. Cohen listed $11.6 million in financial liabilities, most of it in the form of 50 unsecured claims held by vendors, contractors and other “non-priority” lenders, against his $1.5 million in assets.
Among the listed debts is $500,000 owed to the city of St. Paul’s Housing and Redevelopment Authority, and $1.6 million owed to Rethos, a St. Paul-based nonprofit dedicated to the reuse of historic structures. Also owed is more than $5.5 million to MidWestOne Bank related to the Keg and Case property, and $3 million to JTS Capital related to the neighboring Rathskeller building.
Cohen, who lives in St. Paul, converted the brewery’s 168-year-old keg house into 22,000 square feet of commercial space, which opened to heavy fanfare in September 2018 with upwards of two-dozen retailers and food vendors.
Following $10 million in improvements, Five Watt Coffee, the fine-dining establishment In Bloom, the southern-themed Revival restaurant, Sweet Science ice cream and Clutch Brewing became inaugural tenants, alongside a mix of art vendors and specialty booths such as Forest to Fork, which installed a tower of mushrooms stretching more than a story tall.
People sampled the offerings at the then-new Keg and Case indoor market on West Seventh Street on Thursday, Sept. 13, 2018. (John Autey / Pioneer Press)
On Thursday, the marketplace’s website listed three vendors, the largest of which is Starcade video games. The brewery and other primary tenants had all closed shop or relocated.
Court filings
MidWestBank One took title to the Keg and Case deed last October through a special purpose entity, SKH SPE LLC.
The neighboring Rathskeller building was sold at a sheriff’s sale in May 2023, with a one-year redemption period ending May 13 of this year. The title will officially transfer to JTS Capital, a Texas-based asset acquisition and management company, on that date.
Court filings show that on April 3, a scheduled mediation between JTS Capital, Craig Cohen and his father Jeffrey Cohen — a guarantor on his loan — failed to reach a settlement over the outstanding debt related to the Rathskeller building, which houses the ROK music lounge, a bread bakery, a basement event hall and the offices of the West Seventh/Fort Road Federation. Craig Cohen, who is named as a defendant on the outstanding loans, did not make an appearance, and JTS then filed a legal motion for default judgment.
On April 19, Cohen responded by filing for Chapter 7 bankruptcy, which could protect some of his assets as JTS and a bevy of other creditors seek their liquidation.
An attorney representing both JTS and MidWestBank One declined public comment on Thursday, and an attorney representing Cohen in the bankruptcy filing also declined public comment. Sources close to the transactions said it was unlikely that either company would hold onto the properties for long before another sale.
Challenges from pandemic, changing economy
Cohen could not be reached directly for comment on Thursday, but he released a written statement saying he had tried his best to bring some commercial energy to a long-vacant historic property.
“I deeply care about the community and fully committed myself to bringing the Keg and Case House to life as a place for people to gather,” said Cohen in the statement, which was forwarded by a spokesman. “While I still believe in the vision for the market, the challenges we encountered from the pandemic to a changing economy were too significant to overcome. As a result, I have had to make this important and significant decision. After years of looking at every other option, I have exhausted myself both financially and emotionally it’s time for my family to move on to a new chapter of our lives.”
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