A last-minute Chapter 11 filing by the developer behind the long stalled RKO Keith’s Theater parcel in downtown Flushing has yanked the site, at least for now, out of a state court foreclosure sale that was set to transfer it to the lender. Xin Development Group International, the U.S. arm of China based Xinyuan Real Estate, filed in federal bankruptcy court a day before the auction, putting the troubled Northern Boulevard property back under court supervision and keeping Maverick Real Estate Partners from immediately sending it to the auction block.
The petition, filed in the U.S. Bankruptcy Court for the Eastern District of New York and signed by Xinyuan co founder Yong Zhang, lists the lot’s value at about $90.6 million and references a judgment lien near $41.2 million, according to PincusCo. The outlet notes that the bankruptcy move landed just one day ahead of a state court sale that would have wrapped up Maverick’s foreclosure bid. The site’s bankruptcy docket was opened under case number 1-26-42258-ess, per the filing cited by PincusCo.
Maverick, which acquired a pre-development loan originally made by Madison Realty Capital, had moved to foreclose after alleging Xin missed tax and debt-service payments, The Real Deal reports. The lender increased the loan to roughly $34.4 million in 2022 and first initiated foreclosure in July 2023. An August 2025 auction was previously canceled after other creditor actions. The Real Deal also notes that Xin bought the parcel for about $66 million in 2016 and has sold off other assets in recent years while juggling creditor claims.
About the property
The Flushing parcel at 135-35 Northern Boulevard contains roughly 81,000 square feet of built space and about 20,000 square feet of additional air rights, and sits in an R6 zone that allows roughly a 2.43 FAR, according to PincusCo. In a declaration attached to the bankruptcy papers, Yong Zhang wrote that “a foreclosure sale on the Real Property is scheduled for May 8, 2026” and that he believes the property is worth “at least $90,600,000,” language PincusCo published from the filings. The parcel’s size and air rights have long made it an enticing site for a high rise condo plan that has stalled amid the developer’s financial troubles.
Legal implications
The Chapter 11 petition triggers the automatic stay under federal bankruptcy law, which immediately halts most collection actions, including state court foreclosure sales, while the bankruptcy court evaluates claims, in line with the Legal Information Institute’s overview of 11 U.S.C. § 362. Secured creditors such as Maverick can still ask the bankruptcy court for relief from the stay if they argue the collateral is not adequately protected or that a reorganization is unlikely.
What’s next for the Flushing site
With the auction off the table for now, the case will play out in the Eastern District of New York, where Xin can seek to restructure or negotiate with lenders while Maverick decides whether to ask the bankruptcy court for relief from the stay. If the lender wins that relief, a sale could return to the calendar. If Xin buys more time, the company may try to shore up financing or sell assets to satisfy claims. For the moment, the filing delays any immediate auction and sends both sides back to court, according to The Real Deal.
