A Los Altos residential project that has struggled to secure financing has a new owner and is set to bring much-needed housing to the area.
Veteran homebuilder Prometheus Real Estate Group bought the 3.8-acre property at 5150 El Camino Real, MercuryNews reported. The site, two miles from the Mountain View Googleplex campus, was approved for a high-density housing project in 2019.
Prometheus paid $48 million for the property, the majority of which will be used to pay off the property’s mortgage to Loancore Capital Credit. The property was sold by an affiliate of Dutchints Development that paid the same amount for it in 2018.
The sale will offer a return on investment for some, but not all of the investors. Santa Clara County Superior Court Judge Christopher Rudy ordered that Loancore, which provided the mortgage, be paid first, followed by the architect and a broker who was involved with the purchase.
The project has been in default since March 2021, when Dutchints Development failed to repay the mortgage according to the terms of the loan agreement.
Some of the smaller investors of the project had a chance to get their money back when another homebuilder struck a preliminary agreement for the property. KB Homes agreed to pay $60 million for it earlier this year — enough to pay off the loan as well as smaller investors. However, KB Homes abruptly pulled out of the deal, leaving Prometheus as the only interested buyer.
Judge Rudy did negate some of the liens and judgments on the property, which means that investors can’t “capture” any more money from the deal.
[Mercury] — Victoria Pruitt