The popular East Williamsburg art space 3rd Ward, best known for its expansive array of pricey classes and its weekly “drink and draw” sessions, closed abruptly last night without warning. Calls to 3rd Ward currently go unanswered. According to a tip we received this afternoon, rumors abound about the possibility of foreclosure or bankruptcy, with talk even of killing electricity on the space by midnight. Meanwhile, thousands of the organization’s members have no knowledge of the shutdown.
We hear on good faith (but have yet to fully confirm) that 3rd Ward is closing on Friday. Evidently, their fundraising attempts were not enough to keep the operation afloat. Clearly, we are bummed since 3rd Ward has helped make Bushwick and Williamsburg the thriving arts communities that they are today. Here’s an explanation of why they’re having problems:
3rd Ward is seeking an immediate minimum investment of approximately $1.5 million, and we are asking our community to join us. This growth and stabilization capital is essential to our continued success. While we had strong revenues of $3.6 million in 2012, we had a downtick of revenues in 2013 and our expansion and resulting operational costs created a need for a new infusion of equity.
The current operating losses and cash deficit are primarily due to three factors:
Our revenue at the Brooklyn location fell as a result of a change we made to one of our membership products earlier this year.
The new location in Philadelphia is requiring more capital than expected to achieve profitability or reach cash flow break-even.
The development of the Culinary project required advance spending.
The new infusion of capital will be used to:
Recapitalize the Brooklyn location to incorporate key operational changes that will deepen our educational content and improve our membership products, and
Based on the level of investment from the campaign, devote additional resources towards the Philadelphia location and the Culinary project.
We hear that the co-working space will be run by the landlord as a shared studio space. The restaurant, Fitzcarraldo, will remain open.