Home sales at fraud-tied San Jose project stall, Fremont site advances
Two Bay Area condo projects, one in San Jose and the other in Fremont, that were both tangled in a massive Bay Area real estate fraud case, are experiencing differing rates of success.
SAN JOSE — Two Bay Area condo projects, one in San Jose and the other in Fremont, that were both tangled in a massive Bay Area real estate fraud case, are experiencing greatly differing levels of success — and obstacles.
Both the projects were developed by Silicon Sage Builders and its principal executive Sanjeev Acharya, whose Bay Area real estate empire crumbled in 2020.
The Securities and Exchange Commission has accused Acharya and Silicon Sage of fraud, claiming he swindled hundreds of unwitting investors out of more than $100 million. Silicon Sage’s properties have been shoved into court-ordered receivership.
A court-appointed receiver hopes sales of the condos in San Jose and Fremont will help raise cash to help investors recoup at least a small portion of the massive losses they suffered due to Acharya’s alleged fraud.
Yet while sales have proceeded briskly for the 93-unit condo complex at 42111 and 42183 Osgood Road in Fremont, the selling launch appears to be months away for the 91-unit condo site at 1821 Almaden Road in San Jose, court papers state.
“The condominium project owned by Osgood is complete, with 39 units having closed escrow, 15 in escrow, and 27 still being marketed for sale,” Kyra Andrassy, an attorney for a law firm representing court-appointed receiver David Stapleton, stated in a court filing in May that covered the progress of the property dispositions.
The remaining 12 Fremont condos were in contract to be sold at the time Stapleton took over as the receiver. The receiver intends to take legal steps to terminate these contracts to free them up for an unfettered sales effort, court papers state.
In San Jose, construction is continuing on the 91-unit development, which is known as The Almaden. This development was 80% complete at the time of the May 19 status update on Silicon Sage’s properties.
“As of the first quarter of 2023, Almaden continues to make substantial construction progress,” the receiver’s attorney wrote in the court papers.
Three of the five floors were complete, and floors one and two were mostly complete.
“The receiver has made significant progress on the courtyard common area, including installation of the pavers and planters and the buildout of the barbeque countertops,” the receiver’s attorney stated in the court filing.
Getting power connections into the San Jose building remain a significant challenge.
“Difficulties with PG&E energizing the building continues to be the main factor driving delays on the project,” the receiver said of the San Jose complex on Almaden Road. “PG&E has required an entire redesign of the electrical system to meet their new standards.”
The attorney stated that the receiver’s team is working closely with the PG&E design engineering team to expedite the redesign of the utilities for the San Jose development.
“PG&E has an extremely stringent and cumbersome review process that had to be navigated and the project is currently in the final round of review,” the receiver’s attorney said in the court filing.
The receiver intends to reach out to people who had inked deals to buy condos in the San Jose project to ensure the would-be home buyers sign new contracts in an acceptable format. The whole idea is to speed up the sales process at the San Jose project.
“Once construction is completed, sales can start seamlessly,” the court receiver said in the filing.