Greg Malin’s Journey From Luxury to “Lemon”

Open AI founder Sam Altman claimed in a recent lawsuit that he was sold a “lemon” by Greg Malin, the high-end developer who built the $27-million Russian Hill home. Altman is not the first to call out the CEO of Troon Pacific for allegedly shady dealings, after several of Malin’s investors accused him of fraud and embezzlement on four luxury residential developments, including Altman’s.

Though Malin appealed, a judge recently upheld a $50M payout to the investors, finding that Malin and Troon had breached their fiduciary responsibilities.

The recent charges and subsequent declaration of bankruptcy are a far cry from how Malin had presented himself for years, as a successful health- and wellness-focused high-end developer who gave back to the community, all while raising twin teenage boys on his own after the sudden death of his wife and business partner Charlot.

A Haute Living story from 2018 called “Why Greg Malin Is a Generous Visionary” lauded the developer for chairing a fundraiser with $650 tickets for the ODC dance company a year after Charlot’s death at just 48 from an undisclosed illness. The Norwegian-born interior designer had been a big supporter of the arts, as well as Troon’s director of design, and Malin told the luxury lifestyle publication that his wife had convinced him to take a “Vogue” dance class at ODC because she believed you need to do something uncomfortable every day in order to grow.

The couple met in San Francisco in 1992 and founded the Certified B Corporation in 1999. After a successful 2010 rebrand that centered its residential renovations on wellness, especially purified air, Troon began pursuing other high-end health-focused remodels, mostly in the city’s most expensive northern neighborhoods.

Troon bought five properties to redevelop into luxury single-family homes between 2012 and 2016, just as San Francisco’s market was hitting then-record highs. Malin was one of the few to take a risk on building high-end single-family spec homes in the city, where most of that expensive and time-consuming work is taken on by owners who intend to live in the homes they are renovating and aren’t necessarily focused on the bottom line.

San Francisco luxury agents told The Wall Street Journal that Malin was often unrealistic in his pricing and the eventual sales of his spec homes for well below their asking prices bear that out.

The Russian Hill home at 950 Lombard Street that Altman bought through an LLC for $27 million in 2020 was originally listed at $45 million in 2018. Malin told the WSJ that sale was “disappointing” and blamed the early pandemic-era market uncertainty for the reason he accepted the low offer. A Cow Hollow home Troon developed that was initially asking $29.8 million in 2019 sold for about $10 million less, also in 2020.

Another Cow Hollow home that Troon developed listed for $46 million in the summer of 2021 and sold for $32 million to South Bay attorney John Bautista at the end of that year. Though well off the asking, it was the city’s second-biggest sale of that year. Bautista later bought the house next door for $14.5 million as well.

Troon also sold an Ashbury Heights home with entitled plans for a rebuild for $2.65 million after initially asking $8.9 million in the fall of 2020. Troon had owned the lot atop Tank Hill since 2014 but never started construction.

Around that time, Troon’s investors started getting restless and the first lawsuit was filed by an investor in the Russian Hill home, who demanded over half of their $400,000 loan returned. In 2021, an arbitrator agreed that a payout was merited.

A year later, Troon sold off a “shovel-ready” Gold Coast project it had spent years entitling for $17 million just weeks after dropping the asking price from $30 million to $20 million. Troon had bought the property from Zynga founder Marc Pincus for $16 million in 2017 and spent five years getting approvals for an expansion and remodel of the 1907 Dutch Colonial, which was in largely original condition.

In 2022, investors in four Troon projects — the two homes in Cow Hollow, the Altman home in Russian Hill, plus the unbuilt project in Ashbury Heights — filed their suit, arguing that Malin had charged millions in undisclosed fees, their attorney told the WSJ.

It took two years in arbitration, during which Malin filed for bankruptcy, but a retired judge eventually agreed with the investors, ordering Malin to pay $50 million in damages and legal fees. The arbitrator determined that Troon took $14 million in fees, plus engaged in overcharging, double-billing and falsifying documents.

Malin and Troon said in a statement at the time to the WSJ that the fees were above board and once again blamed the pandemic, as well as the city’s lengthy entitlement process.

“We strongly deny the allegations, and we are confident we will reverse the ruling,” he said in a statement to WSJ.

But earlier this month, a Superior Court judge sided with the investors and denied the appeal. Days later, Altman filed his suit under the 950 Lombard LLC, alleging that necessary fixes to the property will cost $4 million, and directly referencing the investors’ suits as reasons for the “rancor, poor supervision, shoddy workmanship, corner-cutting, and financial embezzlement that had characterized the development and construction” of his home.

“With the specter of investor lawsuits looming, Developer engaged in a fraudulent sales campaign that misrepresented to Owner the actual condition of the Property,” according to the suit.

Malin has not yet commented on the Altman litigation.