Lenders Seek Foreclosure on San JoseGreyhound Bus Station

A downtown San Jose site proposed for more than 700 homes has become the latest flashpoint in the battle over Z&L Properties’ holdings in the Bay Area.

A lender tied to real estate executives William Wang and Chris Jiashu Xu is moving to seize the former Greyhound bus terminal at 60 and 70 South Almaden Avenue over a delinquent $19.5 million loan, The Mercury News reported. The property is owned by an affiliate of China-based Z&L; that entity filed for bankruptcy in July to stave off the foreclosure seizure.

On Oct. 2, a federal judge cleared the way to proceed by issuing an order that would effectively terminate the bankruptcy case and allow the lender to proceed with the foreclosure and seizure. That same day, the Z&L affiliate filed a lawsuit to block the foreclosure, alleging wrongful foreclosure and unfair business practices among other claims.

The suit claims that about a year ago, the lender proposed a way for the Z&L affiliate to reorganize financing for the property, albeit primarily via a loan with a 10 percent interest rate, higher than the 8 percent rate on the delinquent loan.

“The October 2024 renewal was not a real workout,” the Z&L affiliate said in a court filing. “It was a foreclosure trap.”

The Z&L affiliate is already approved to develop about 700 housing units on the former Greyhound station site, though the developer never broke ground on the project. Because so much time has passed, the permits for the site have expired, so a developer would have to start the planning process over from square one.

Still, both the Z&L affiliate and the lending group haven’t given up hope on building, as they’ve both stated in court filings that they have new plans to develop housing at the site.

It’s the latest chapter in a series of real estate scandals in San Jose tied to Z&L Properties and its affiliates.

A Z&L-owned historic church at 43 East Saint James Street in downtown San Jose, for example, has drawn complaints for its dilapidated state. In June, Machine Investment Group bought a two-tower residential complex at 188 West Saint James Street in a foreclosure proceeding that took ownership of the property from a Z&L affiliate.

Nearly all of Z&L’s real estate empire in San Jose has fallen apart through deeply discounted property sales or foreclosure proceedings, and the Greyhound station appears to be part of its last stand.

— Chris Malone Méndez