Investor snatches fraud-mired realty
Unclear if Sunnyvale offices, residences will return money
SUNNYVALE >> An office building and residences in Sunnyvale linked to a Bay Area real estate fraud case have been bought, but it’s unclear if the deal can return money to investors who had been swindled.
The deals are the most recent known transactions involving the collapsed Bay Area real estate empire of failed and fraudaccused developer Silicon Sage Builders and the company’s principal executive Sanjeev Acharya.
A Saratoga-based investment firm has bought an office building at 510 S. Mathilda Ave. and an adjacent apartment complex at 518 through 528 S. Mathilda Ave., according to documents filed on Oct. 15 with the Santa Clara County Recorder’s Office.
Both properties are part of the real estate holdings of Silicon Sage and Acharya that have begun to dissolve in the wake of charges filed by the Securities and Exchange Commission that allege Acharya committed fraud against hundreds of investors, many of them South Asian, who sunk money into Silicon Sage’s projects.
A federal court authorized a receiver, David Stapleton, to take control of the properties and attempt to sell them in a quest to raise some cash that could be returned to investors whom the SEC claimed were defrauded by Acharya and Silicon Sage.
In the most recent known transaction, Sam Cloud Barn, an affiliate controlled by Bay Area real estate investor Shawn Taheri, paid $6.45 million for the office building and an adjacent apartment property, the county records show.
Taheri’s Saratoga-based group, which is also affiliated with HL Investment Management, obtained a loan of $2.67 million from Citizens Equity First Credit Union at the time of the property purchases, according to public documents.
Other Silicon Sage properties have been bought in recent deals linked to the fraud case:
— On Sept. 29, the office and retail units in the Madison mixed-use development at 1364, 1374 and 1378 El Camino Real in Santa Clara were bought for $2.6 million. Residential condos in the complex weren’t involved in that deal.
— On Oct. 13, the One38 Apartments, a 101-unit complex at 138 Balbach St. in downtown San Jose, was bought for $53.5 million by an investment firm.
Numerous other Silicon Sage properties are being actively marketed for sale, but it’s unclear when buyers might emerge for the other sites.
The court-appointed receiver has begun a lengthy process of attempting to salvage value from the collapsed and bankrupt real estate empire by finding buyers for the properties.
Some of the sales attempts must navigate past significant obstacles before the properties can be sold. In at least one instance, a lender is threatening to foreclose on the property and seize its ownership.