3rd Ward Members Won't Get Refunds After Abrupt Closure

By Meredith Hoffman on October 10, 2013 3:32pm 

 Scott Braun, who has been in the space since before 3rd Ward entered the building, works in his wood shop previously. 
Scott Braun, who has been in the space since before 3rd Ward entered the building, works in his wood shop previously. 
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Scott Braun

EAST WILLIAMSBURG — Members of the renowned arts and coworking space 3rd Ward who plunked down big bucks for access to classes won't get their money back after the owners of the 30,000-square-foot workspace announced its closure last week.

The space at 195 Morgan Ave., which opened in 2006 and drew countless would-be artisans alongside dozens of tenants subleasing from the company, will not offer refunds to anyone for their memberships, the company said in an email Wednesday.

"Unfortunately, you will not have an opportunity to use your membership after today at 6 p.m., and we will not be able to refund any payments made for membership services that have not been fully utilized before that time," the email said. "With the costs of running and operating our space, we are sadly no longer able to remain in business."

At the building Thursday afternoon, members carted out their supplies, with one member yelling at the front desk worker about the $1,400 he was losing from canceled classes. The employee said he could not refund the member and said that everyone else from the company was "unavailable."

As another member passed by, he shrugged and shook his head.

"It was a great business idea," said Gene Reilly, who'd used the space for woodworking. "But they needed a better business plan."

Both tenants and a representative for the landlord said they were working to preserve the space despite the imminent closure.

"I had some tenants who paid a year up front to 3rd Ward, and that's between 3rd Ward and them," said broker Nigel Shamash, who represents the company 5CE, which owns the building. "But what I can do is make sure that at least they can keep space in building."

Shamash said tenants still had to empty their rooms, since 3rd Ward's management needed the space to be cleared in order to return the key. But he said he would store their supplies in part of the building if they contacted him with plans to rent the space.

 3rd Ward was quiet on Thursday, Oct. 10, except for members coming to collect their belongings.
3rd Ward was quiet on Thursday, Oct. 10, except for members coming to collect their belongings.
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DNAinfo/Meredith Hoffman

"This is the trouble with signing a sublease," Shamash said, noting that 3rd Ward had between 40 and 60 tenants, and that even he hadn't learned of the closure until two days ago.

Representatives for 3rd Ward declined comment, but Shamash claimed the business was in serious debt to creditors. The closure was first reported by the New York Observer.

Many members are trying to remain in the building, but some tenants said they feared they'd have no chance at keeping their spaces.

The first tenant in the building, Scott Braun, was in the space before 3rd Ward ever arrived. He moved out of his 10,000-square-foot space on the second floor in 2010 when the space's founder, Jason Goodman, convinced him to instead start subleasing from him on the third floor.

"He was going to subsidize my rent by $2,000 a month for the next eight years," Braun said of the deal Goodman promised Braun to get him to move, so 3rd Ward could open a school on the second floor. "I thought, 'This guy is enough of a hustler that he won't go out of business.'"

Braun, who learned of the closure on Thursday morning, said he completely relied on the space for his furniture company — but that he couldn't imagine affording the cost of renting it now.

"It sucks. I was the first tenant and I'm not looking forward to leaving," he said. "This could put me out on the street."

Meanwhile, other members have begun organizing through two online hubs to keep their spaces. One member has started the website Save3rdWard.com, the International Business Times first reported, and another is requesting people email him at 3rdwardrefugees@gmail.com.

"I created [the email] because there's not a really strong community at 3rd Ward, so now that it's not there anymore we’re all separate," said the man who started the 3rd Ward email address but asked that his name not be used. "As much as they talked about it being a community, it was just really disparate communities...They opened a restaurant [in the building], but that just ended up being a typical overpriced Brooklyn restaurant where nobody would go to lunch."

The contact for Save3rdWard.com did not immediately return emails requesting comment.

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