Empty San Jose Condos Open to Buyers

Two condominium towers in downtown San Jose are waiting to be filled, and its owners are ramping up efforts to get residents inside.

Machine Investment Group is marketing condos for sale at 188 West Saint James Street, the Mercury News reported. The property consists of a 22-floor eastern tower with 337 units and a 20-floor western tower with 303 units for a total of 640 homes. Machine Investment Group and building operator Centurion Real Estate Partners are searching for buyers to purchase unsold units at the site.

The market appears ripe for buying, Josh Tashjian, managing partner with Centurion Real Estate Partners, told the Mercury News. San Jose is “underserved by housing” and simultaneously faces “significant housing demand and great purchasing power.”

Machine Investment Group acquired the two residential towers from Z&L Properties in a fast-tracked foreclosure proceeding last June for $181.9 million. Machine Investment obtained a $215 million loan from an affiliate of New York-based Benefit Street Partners for the acquisition. Z&L, which owned and developed the properties, defaulted on a $330 million loan from a Mack Real Estate Credit Strategies affiliate, leading lenders to pursue an expedited deed-in-lieu of foreclosure process.

After Machine Investment acquired the towers, the company vowed to breathe new life into the buildings. The firm is investing $30 million to renovate and upgrade the towers, common areas and amenities ahead of the condo sales. Machine is looking to redesign the lobbies and build out a club on the third floor complete with private workspaces, social lounges, a catering kitchen, an outdoor terrace, a 75-foot pool, a hot tub and barbecue areas.

As of Wednesday, 202 of the 303 units in the western tower were unsold, and all 337 units in the eastern tower were not spoken for. But demand is already reportedly picking up, as Centurion Real Estate Partners is working through a multi-page list of interested buyers, some of which include current occupants looking to buy larger units.

— Chris Malone Méndez