Chris Xu-Led Lenders Seize San Jose Development Site

The embattled former Greyhound bus terminal in downtown San Jose has a new owner after a foreclosure process involving nearly $23 million in debt.

A lender group led by New York developer Chris Jiashu Xu and business executive William Wang has taken over the Greyhound site at 60-70 South Almaden Avenue in a $22.2 million foreclosure proceeding, The Mercury News reported. The foreclosure comes after an affiliate of China-based Z&L Properties defaulted on a $19.5 million loan.

Z&L had been approved to build a 708-unit residential tower at the site but never broke ground. The company fought to keep the site via two Chapter 11 bankruptcy cases and a lawsuit to block the foreclosure, but they were unsuccessful. Z&L claimed it spent $44.2 million on land purchase and pre-construction costs before the asset was seized. The new owners aren’t looking to deviate from that plan.

“The vacant land at issue is a rotting, empty former Greyhound Station,” the lender said in a U.S. Bankruptcy Court filing. “If allowed to proceed [with foreclosure], the lender has the resources to develop this piece of property as originally entitled.”

With the Greyhound terminal now out of its hands, Z&L Properties, which once boasted a large real estate empire in the Bay Area, now owns just one property. A Z&L affiliate owns a historic church at 43 East Saint James Street. Z&L previously proposed a two-tower housing development at that site, which would also renovate the aging church. But, as with its plans for the Greyhound station, the project remains at a standstill.

Xu’s real estate activity has largely been concentrated in the New York City area. The developer counts residential towers and a hotel in Queens among his developments. In San Jose, in January of last year, a group led by the developer acquired most of the Eastridge Center shopping mall in East San Jose for $135 million.

— Chris Malone Méndez