Avatar Income Fund lost a ton of cash with Nocturnal.

The Seattle-based lender just sold the building  for $1.6 million, lossing an estimated $2.2 million in the process ($3.8 million  was the original loan made to Kore Entertainment).

Nocturnal was owned by Glenn Kofman. Kore Ent has since filed for bankruptcy leaving over 20 creditors with nothing but bad debts.