48 Pond Street

Listed for “$800,000” early last year, or roughly $560 per square foot in an area where properties had been selling for around twice as much, it shouldn’t come as too much of a surprise that 48-50 Pond Street in the Castro sold for $1,310,000 and nearly “65 percent over asking!” at $913 per square foot, roughly 15 percent below the going rate for the neighborhood.

Purchased by “PP Investment Fund LLC,” which is related to Persica Properties in the city, the sale of the two-unit building closed escrow on April 24, 2015. Permits to reconfigure, expand and renovate the 1,434-square-foot property were secured in August and the work soon began.

48 Pond Street Construction

By February, the home was in foreclosure.

And yesterday, 48-50 Pond Street resold for $1,080,000 in cash on the courtyard steps, another 18 percent discount versus what was paid thirteen months ago.

The permitted plans for the property include the addition of two bedrooms, two bathrooms and a roof deck.

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Comments from “Plugged-In” Readers

  1. Posted by Just My Opinion

    Unfortuately, Pond Street, a one block street, is a tough location. The corner of 16th and Pond at the Public Library is a homeless encampment that is perpetually there. On the other hand, the corner at Pond and 17th, is the location of Frances, a terrific restaurant.

    • Posted by Heidi Bottler

      Yes, there is the library but the location is still amazing and right in the heart of the Castro in the flats… Hello!!!!

    • Posted by jj

      Get real- the entire city is a homeless encampment. Or worse.

      • Posted by cleverpunhere

        No, it isn’t. I share the opinion that Pond street is a particularly tough spot, even if surrounded by really nice streets.

  2. Posted by Just My Opinion

    It SHOULD BE amazing but is not because of the our inability to deal with quality of life issues in the City. In fact, yesterday, on Prosper Street, which straddles the other side of the library between 16th and 17th had several cars hit with spray paint yesterday.

  3. Posted by anon

    Some hard money and/or non-bank lenders I assume? Feb foreclosure to June sale seems like a very fast timeline for traditional banks.

  4. Posted by wc1e

    I walk past this house daily. When it first sold there was a flurry of activity for about a month and then it appeared that someone was either living on the property or someone was squatting. At one point there was an extension cord running from a generator in the garage outside the building and through an upper window to bring power in at night.

  5. Posted by Confused renter

    Are details available on how the loan was structured?

  6. Posted by soccermom

    Per Secretary of State
    Entity Name: PP INVESTMENT FUND LLC
    Entity Number: 201221210067
    Date Filed: 07/24/2012
    Status: ACTIVE
    Jurisdiction: CALIFORNIA
    Entity Address: 9000 CROW CANYON RD STE S-327
    Entity City, State, Zip: DANVILLE CA 94506
    Agent for Service of Process: LEYLA ALHOSSEINI

    Per title docs:
    PP INVESTMENT FUND LLC
    9000 SAN RAMON VALLEY BLVD S32
    SAN RAMON, CA 94583

    First Position: 4/24/2015 $982,500 lent by Shane Family Trust
    Second Position: 4/24/2015 850K lent by 29 SW LLC
    Third Position: 5/22/2015 $190K by Foothills Financial
    Fourth Position 5/22/2015 $285K by Pacific Financial
    Fifth Position 9/10/2015 $150K by “Other Institution”

    Hmm, East Bay Operation, shady stacked loan structure, over-paid, over levered. Where could we have heard this before? Glad to do the legwork on this story another time…

    • Posted by SFBayview

      Total loan amount of $2.457M on 1.3M property? Why would someone be willing to lend above the purchase price? Was the appraisal value much higher than purchase price?

    • Posted by Confused renter

      Thanks for digging this up!

      That’s $2.45m invested. Hard to believe a 1,400 sq foot property can be flipped for much more, even in such desirable location.

    • Posted by formerly%whatever

      Don’t jump so quickly to conclude. I don’t know the case here, but since it is a “fund” maybe the junior encumbrances were cross collateralized with other fund properties.

    • Posted by Jimmy The House Flipper

      There’s some kind of fraud going on with these properties; does anyone know what it is? Maybe a tax fraud (fictitious losses between related entities) or something else?

      • Posted by anon

        Some possibilities. Collusion between the flipper and the 1st lien holder? The RH guy was offering 10-12% interest on the 1st lien according to his site. The 1st gets that ~$100k interest and still gets made whole during the foreclosure sale. Interest gets paid out of the money from the juniors who get completely wiped out. Possibly also collusion with and/or fake vendors who do no or overpriced work on the property. Some of that gets kicked back to the original flipper.

    • Posted by Ohlone Californio

      Gee. How surprising. The agent was so pleasant, forthcoming, knowledgeable, and did such a wonderful job for her clients on the other distress sale aspect of the company business. end sarcasm

  7. Posted by inclinejj

    Good Job SoccerMom. I was just going to comment on the “creative financing”

  8. Posted by soccermom

    Substantial breadcrumbs have been left for us to find so here goes:

    Here’s Leyla’s web site:

    “My Philosophy: My clients succeed because my real estate business is based on collaborative teamwork built on trust, honesty, and faith. I have an industry-wide reputation for tenaciously and effectively protecting my clients’ interests as I facilitate residential, commercial, probate and other financial transactions. Both a savvy negotiator and a natural-born “people person”, I am uniquely equipped to help fulfill your dreams — whether you’re reaching for the stars or something a bit closer to home.” FFS!

    How is Leyla related to RH Investments of recent 701 Teresita fame?

    They’re both Persian, right? Both self-styled investors from the East Bay with hard money loans? Both of them have junior loans from some version of SW LLC (Looks like Leyla’s was 29 SW…I hope that doesn’t mean there are 27 other SW’s about to get hosed).

    Finally, formerly%whatever could be right that we’re seeing cross-collateralization with other properties, but as we learned in subprime CDO’s, 15% of a broadly diversified bucket of cr*p is still 15% of cr*p.

    • Posted by Jimmy The House Flipper

      A huge amount of pent-up capital left Iran after the nuclear treaty was signed, I am wondering if this is some sort of scam related to that. It pushed up prices in West Vancouver and other neighborhoods with large Iranian expat populations significantly.

      I recall another Ethnic Fraud type Ponzi scheme that was exposed in 2008 … can’t remember the guy’s name but I think he was Armenian or something. It was on Socketsite.

    • Posted by bg

      RH was Pakistani. Yes, Leyla is Persian.

  9. Posted by Amewsed

    Soccermom has a new moniker: gumshoe/sleuth. Since it is all private money, there are fewer eyes and less scrutiny. The mere fact that purchaser and private lenders are all under an LLC name doesn’t say much. Many sophisticated and legitimate buyers of investment properties do that. Is the bigger concern money laundering or tax evasion by booking a loss while hiding gains elsewhere?

  10. Posted by Jimmy The House Flipper

    Can anyone figure out what other properties these people have bought? They might be excellent acquisition targets as several appear to be in distress and headed for foreclosure.

    • Posted by Ohlone Californio

      They might be, if they didn’t overpay in the first place, which they did.

    • Posted by soccermom

      There really aren’t that many foreclosures in San Francisco. If you have the right data service, finding upcoming auctions and viewing the capital structure of the ownership is straightforward.

      • Posted by EBGuy

        Am I correct that you need a pay service for the title docs info? In the golden age of data (a decade ago) you could get three free reports from Propertyshark…sigh… I have to rely on the Ess Eff Recorders site for most of my research/entertainment.

  11. Posted by Confused renter

    They are using LLCs for each individual investment to shield and obfuscate gains/losses from parent company.

  12. Posted by inclinejj

    Soccermom, which data service do you use. I tried to pass along my contact info but the post got deleted.

  13. Posted by inclinejj

    Oh a wise azz! I like it!! haha

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