SAN JOSE — A San Jose hotel development site has been saved from foreclosure with the sale of the real estate.
The property, located at 2850 Stevens Creek Blvd, was originally proposed for a 175-room, 11-story hotel tower. It was previously a gasoline service station and is now occupied by TintWorks, a window tinting service.
An affiliate of a San Leandro-based gasoline station executive purchased the property for $4 million.
The property is located near San Jose’s mega malls and is across the street from Westfield Valley Fair Mall.
Due to the impact of the pandemic on the lodging industry, hotel development projects are currently unpopular with developers and lenders.
Prior to the coronavirus outbreak, San Jose city officials had approved the hotel project. However, the hotel industry suffered from low occupancy levels even after the lockdowns ended.
The infrastructure of the old gasoline station remains intact, allowing for a potential fueling operation.
The hotel development site had faced foreclosure multiple times.
In 2019, the First Credit Bank provided $6.7 million in financing to a group led by Adeel Mahmood of Villa Developers & Investment. Mahmood’s group defaulted on the loan, leading to the sale of the property to the Salkhi Petroleum group.
Despite the change in ownership, First Credit Bank still has involvement in financing the property by providing $4.5 million to the Salkhi group’s affiliate.