Local brewer Urban Chestnut Brewing Co. owes over $4 million in loans, according to recently filed bankruptcy documents.
The brewery announced last week it would file for Chapter 11 protection to reorganize its finances. The filing itself shows the business’s grim financial state.
Court filings show that Urban Chestnut owes more than $2.1 million on a Small Business Administration loan and more than $1.9 million of a $3.6 million loan from Midland States Bank.
Other creditors with unsecured claims listed in paperwork include the St. Louis Development Corp., David Luetkemeyer, Lester Nydegger, L. Shine Investments, Joseph B. Basralian and Daniele V. Basralian, and Kurt Bishop Klebe and Brooke Cheley Klebe.
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Creditors Luetkemeyer and Nydegger both sued Urban Chestnut separately in May, accusing the brewer of failing to make payments on loans for years. Urban Chestnut now owes the creditors more than $400,000, according to the two suits.
David Wolfe, a co-founder of Urban Chestnut, said in a statement the company will be working with an investment partner, Brian Travers, during the bankruptcy process.
Urban Chestnut cited the COVID-19 pandemic in a recent news release as a factor that led to financial pressures, an obstacle seen across the entire craft beer industry. Rising costs, interest rate hikes and shifting consumer habits led O’Fallon Brewery to also file for bankruptcy protection last year.
Urban Chestnut did not respond to a request for comment.
The company said it will continue to operate its locations and brew beer. No jobs will be impacted, and the company’s leadership team of Wolfe, Florian Kuplent and Jon Shine will also remain in place.
Urban Chestnut was founded in 2010 by Wolfe and Kuplent. It opened its first location, Midtown Brewery & Biergarten, in January 2011 in the Covenant Blu-Grand Center neighborhood of St. Louis. Three years later, it opened its second location in the Grove. A third Urban Chestnut brewery is operated in the Hallertau region of Bavaria, Germany.