A China-based real estate firm whose co-founder was recently arrested in connection with a bribery scheme is selling off a premier residential development site in San Jose, while the fate of two others is still unclear.
The former Greyhound bus station site at 70 S. Almaden Ave. in downtown San Jose, owned by Z&L Properties, is up for sale, according to Jon Teel, a vice president with commercial real estate firm CBRE, who is part of the team handling the listing.
The asking price was not disclosed by CBRE.
The sale doesn’t come as a surprise, as Z&L has been unable to develop some of its projects in San Jose for several years. The company’s co-founder, Zhang Li, was detained in London in late November on a warrant from authorities in the Northern District of California, alleging he was part of a bribery and kickbacks scandal in San Francisco between 2015 and 2020.
The roughly 1.6-acre Greyhound site has previous approvals from the city for the development of just over 700 homes, along with roughly 14,000 square feet of retail space, spread across two high-rise towers.
“I think it’s a tremendous site,” Teel told San José Spotlight, noting the site will serve as a “missing puzzle piece” for the area’s planned revamp. “It’s surrounded on three sides by new office construction projects to the tune of five million square feet that are going to be within two blocks.”
Developer JP DiNapoli has a more than 800,000-square-foot office tower project planned at 50 Almaden Blvd., just west of the Greyhound site. Just southwest of the site is Jay Paul’s largely completed, 900,000-square-foot office tower known as 200 Park Avenue. The developer is also planning a roughly 3.8 million-square-foot triple office tower project known as CityView Plaza at 170 Park Ave., estimated to be completed by the end of 2024. Nearby, at 333 W. San Fernando St., Adobe is completing its new office tower and a bridge to connect to its current headquarters.
More stalled projects
Another major project that never came to fruition under Z&L’s ownership is Park View Towers at 252 N. First St., just north of St. James Park. The company has owned the site since 2017 and planned to build two towers with a total of 221 homes and almost 19,000 square feet of retail space.
The site was a former city-owned redevelopment property. Any developer building there will be required by the city to renovate and restore the First Church of Christ Scientist building, which has been wrapped in a deteriorating tarp for several years.
Currently, that site does not appear to be listed for sale.
Yonggang “Frank” Cui, the CEO of Z&L Properties, declined to comment when reached by San José Spotlight. The current attorney for the company, Paul Mann, did not respond to requests for comment.
Bob Staedler, a development and land use consultant and San José Spotlight columnist, said he is concerned about the church continuing to languish, and said the city needs to take action.
“The coverings were all torn when all that rain happened,” Staedler told San José Spotlight. “Who knows what the water damage is.”
Staedler said the required renovation of the church takes value away from the land for any possible sale, and said he’s not surprised Z&L isn’t taking better care of the historic structure.
“I think they know what they’re doing, they’re not fools. They’re not protecting it because it’s not adding value,” he said of Z&L. “This is the city’s responsibility and they should do something about it, but they are not.”
Both the Greyhound site and the Park View Towers site have current entitlement approvals for the development plans, but a new developer taking over the projects would likely need to gain fresh ancillary approvals from the city to allow development to go forward, a city spokesperson said.
Silvery Towers condos still selling slowly
Z&L also owns a dual-tower residential project at 188 W. St. James St., formerly known as the Silvery Towers. The project includes 643 condominiums, but has only sold several units so far in one tower, Staedler said.
It’s unclear if Z&L plans to sell off the Silvery Towers project, but given the $330 million in debt the project took on, Staedler predicts the project may be foreclosed on by its creditors.
That project faced accusations that some laborers on the project were trafficked, being forced to work without pay and were living in squalid conditions in a home in Hayward.
One of the development’s employees died after a fall at the project in 2018, prompting a state probe.
“The lack of sales at Silvery Towers is telling you that it is not successful, and if you look at other high rises around San Jose, they are selling their units,” Staedler said. “At some point the lenders are probably going to step in.”
Contact Joseph Geha at [email protected] or @josephgeha16 on Twitter.
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