Newport “Billionaire” Who Launched Audrain Museum Used Cars to Secure Millions
GoLocalProv News Team and Josh Fenton
Newport “Billionaire” Who Launched Audrain Museum Used Cars to Secure Millions
Nicholas Schorsch, who launched the Audrain Auto Museum in 2014, has leveraged dozens of rare autos tied to the nonprofit to borrow tens of millions of dollars.
GET THE LATEST BREAKING NEWS HERE -- SIGN UP FOR GOLOCAL FREE DAILY EBLASTAccording to financial documents filed with the state of Rhode Island, Schorsch has used dozens of vehicles as collateral with Sotheby’s Financial Services.
The cars were posted as collateral in March of 2024. Just weeks later, Schorsch, via one of his companies - Heritage Restaurant Group, purchased the Brick Alley Pub on Thames Street. It was just the latest purchase by one of Schorsch’s companies.
Previously, the group had bought or launched LaForge Restaurant, The Reef Restaurant, Wally’s Wieners, La Costa Lobster Rolls and Tacos, Cluck Truck, Cluck House, A Mano Pizza & Gelato, Wiener Wagon and Newport Lobster Company, Aquidneck Island’s largest wholesale seafood dealer. The group had also purchased Newport Craft Brewing and Distilling Co.
The collateralized autos include three Bugattis, four Ferraris, multiple Mercedes-Benzs, including two highly sought-after Gullwings, a 1907 Renault, and many more.
One of the autos was featured in a promotional video featuring comedian Jay Leno. The 1936 Bugatti Type 57 Ventoux Two-Light Coupe is one of the autos on the Sotheby's list.
According to two auto collectors whom GoLocal interviewed and requested anonymity, the value of the 32 vehicles Schorsch is using as collateral is estimated to be in the tens of millions.
Both collectors reviewed the list of the vehicles in detail, and one estimated the vehicles are valued at approximately $20 million. The second collector estimated the appraised value would exceed $30 million.
Schorsch's attorney, Michael Anderson said in an interview with GoLocal "It is normal corporate finance. Not unusual at all. Collectible vehicles provide liquidity to the collectors of those cars."
SEE THE FULL LIST OF VEHICLES AT THE BOTTOM OF THE STORY
Who Owns the Cars Going to Sotheby’s?
According to the filings, the cars are owned by another collection of limited liability corporations controlled by Schorsch and his wife.
The documents state Audrain Collection MT, LLC; Audrain Collection II MT, LLC; Collections MT, LLC, Collections MT II, LLC, Audrain Collection II, LLC, Nicholas Schorsch; and his wife Shelley Schorsch are the "debtors."
Schorsch, both in his business dealings in Philadelphia and New York City, created a plethora of corporations.
In New York, Schorsch again built an empire and then faced a number of regulatory issues and lawsuits. At one time, Schorsch was deemed a billionaire by Forbes, and then the designation was removed.
In one case, a Schorsch company, AR Capital, Schorsch, and the CFO Brian Block agreed to a final judgment to the U.S. Securities and Exchange Commission that imposes permanent injunctions from violations of the charged provisions; orders combined disgorgement and prejudgment interest on a joint-and-several basis of over $39 million, which includes cash and the return of the wrongfully obtained ARCP operating partnership units; and imposes civil penalties of $14 million against AR Capital, $7 million against Schorsch, and $750,000 against Block.
According to the Rhode Island Secretary of State's database, Audrain Auto Museum’s business registration with the state of Rhode Island was revoked on September 9, 2024.
The Audrain Auto Museum is just one of the companies created by Schorsch that is tied to the Audrain brand.
This weekend is the annual Audrain Newport Concours & Motor Week, an event that brings thousands to Newport of the course of the weekend.
Schorsch told GoLocal in an interview that "we have a feasibility study that shows that we brought $25 to $35 million in for a 4-day period."
The Saturday night gala has a top ticket price of $2,750.
There are eight corporations registered under a name associated with Audrain. The Audrain companies' filing with the state describes their businesses as real estate; another is for special events, and another is for publications.
As GoLocal reported in May, Schorsch has made some close political friendships.
Since his troubles in New York, in Rhode Island, Schorsch has ingratiated himself with significant campaign donations, a well-compensated board slot for an influential state legislator, Lou DiPalma, and the offer of another board position to the former president and now chancellor of Salve Regina, Sister M. Therese Antone.
As GoLocal unveiled, DiPalma was appointed to serve on the board of one of Schorsch's companies and received an estimated compensation of $200,000.
Schorsch and his wife each donated $2,000 to DiPalma's political campaign account in May of 2024.
Antone was a board member appointed to serve on Schorsch’s failed attempt to create a $200 million SPAC — a so-called blank check company.
In less than four years, he and his close family members have pumped more than $100,000 into the campaign accounts of top candidates — all Democrats in Rhode Island.
According to campaign finance reports, Schorsch and his immediate family have poured tens of thousands into the coffers of the campaign accounts of now-U.S. Congressman Seth Magaziner.
Schorsch, his wife Shelley, their children and their spouses have donated via state campaign donations, federal donations, and independent expenditures for a total of $32,600 to Magaziner.
The list of donors includes Schorsch’s son-in-law, Brendan O’Donnell — who is also a business partner with Schorsch in the failed SPAC as well as in many of the companies Schorsh has founded in Rhode Island.
Of the $32,600 to Magaziner, $12,500 was donated by Schorsch to the pro-Magaziner independent expenditure called Bright Future Rhode Island.
GoLocal asked the Treasurer of Bright Future Rhode Island, political veteran Paul Tencher, about the criteria for the fund. He said it was primarily a union PAC.
Magaziner refused to answer questions about his tied to Schorsch.
Another significant beneficiary of Schorsch's family political donations is former CVS President and gubernatorial candidate Helena Foulkes. She is the recipient of $6,000 from the Schorschs.
One recipient of Schorsch financial support, who is donating the monies to non-profits is Newport Mayor Xaykham "Xay" Rexford Khamsyvoravong. When GoLocal interviewed him for this series in May, the Mayor was very complimentary of Schorsch, and said he appreciated his financial support.
In April, one of Schorsch's Newport corporations won an important contract with the City of Newport.
Schorsch's firm announced in a national press release, "1899, LLC (now doing business as The Heritage Restaurant Group) is pleased to announce that at tonight's Newport City Council meeting, 1899 was awarded the concessions contract for the 2024 summer season at Easton's Beach. 1899 is a robust, multifaceted restaurant and hospitality company currently overseeing and supporting three brick-and-mortar restaurants in the City of Newport, a fleet of mobile food trucks and mobile food carts, and a state-of-the-art mobile food kitchen."
The Mayor wrote in an email to GoLocal in July, “I noted that your piece regarding Audrain's donations is forthcoming and wanted to flag some facts that aren't yet on your radar because my latest campaign finance report has not yet been filed.”
“This past quarter, the Audrain organization became a significant vendor to the City of Newport after winning a competitive bid for beach concessions. Because of their increased involvement with the City as a significant vendor, I conducted a review of prior campaign contributions I'd received from individuals associated with Audrain, and donated those funds to community non-profits,” said the Mayor.
“I identified contributions from 2023 totaling $2,500 and donated those funds to the following community organizations, which will be reflected on my Q2 campaign finance report as "Donation of contributions received in November 2023 from individuals employed by Bellevue Capital, Newport Craft or Metropolitan Wealth Management."
Over the past decade, Schorsch has immersed himself in Newport via politics and business.
LIST OF VEHICLES
This story was first published 10/6/24 6:30 AM