The completed phase of downtown Phoenix's X co-living tower is headed for the auction block after its developers failed to pay off a $128 million loan on the project. New York-based lender Mack Real Estate Group has notified XSC Phoenix Investment LLC, the borrower and developer behind the 330-unit apartment community at 200 W. Monroe St., that the property will be sold at a trustee sale on Dec. 10.
The sale, first reported by ABC15 Arizona, concerns Phase 1 of X Phoenix, a $100 million development that marked Chicago-based developer The X Company's debut in the Phoenix market. It's a non-judicial process: under Arizona Revised Statutes § 33-807, a deed of trust automatically hands the trustee power of sale once a loan defaults, letting the lender auction the property without going through a courtroom, according to RJP Estate Planning. State law says the trustee's power of sale cannot be exercised before the 91st day after recording the notice, and trustee sales are far more common than judicial foreclosure generally, per the same source.
The debt behind Phase 1 runs deeper than the single loan figure cited in county documents. As of May 2025, the full debt stack on the property totaled $155 million, made up of a $123 million senior mortgage and a $32 million mezzanine loan, both of which had already defaulted ahead of their initial September maturity, according to Bisnow. Newmark marketed that debt for sale on Mack Real Estate Credit Strategies' behalf, and Phoenix and Denver debt were offered separately or together, the outlet reported.
A Second, Unfinished Tower Faces Its Own Foreclosure
X Phoenix, developed in 2022, contains 330 units. It sits beside an even more troubled sibling: Phase 2, a planned 352-unit expansion, saw construction halt in 2023.
That stalled expansion is also the subject of a legal dispute. A court issued a summary judgment in April 2025, and a possible court-ordered sale of the developer's interest in the site has been reported, according to AZBEX. The report does not establish how that possible sale relates procedurally to Phase 1's trustee-sale notice.
Contractor Dispute Adds to Project's Troubles
The project also faced contractor payment disputes, and construction on Phase 2 halted in 2023.
The site's ownership and tax arrangements were not detailed in the available reporting.
Trouble Stretches Well Beyond Phoenix
The X Company was founded in 2018 by CEO Noah Gottlieb, who had previously helped pioneer the co-living concept at Miami-based Property Markets Group before launching his own firm to build social-living towers across major U.S. metro markets, according to The Real Deal. The business model blends fully furnished private apartments and co-living suites with coworking hubs and members-only social clubs, per the outlet.
Phoenix isn't an isolated case for the developer. The X Company also defaulted on a $170 million interest-only loan tied to its 455-unit X Denver tower after it matured in January 2025, and it has projects planned in Houston and Tampa, Bisnow reported. The Federal Reserve raised interest rates by 75 basis points in July 2022, according to The Real Deal.
A report in April 2025 described the stalled Phase 2 tower as facing a possible foreclosure sale after a court ruling. The Dec. 10 trustee sale of the completed Phase 1 tower marks a new chapter in the financial unraveling of the downtown Phoenix development.
