SAN JOSE — A regional transit agency’s quest to seize a downtown San Jose property needed for a potential BART station project could be decided by a Santa Clara County court trial.
The Santa Clara Valley Transportation Authority wants the property for a future BART station in downtown San Jose.
SAN JOSE, CA – JULY 30: ENSO Bar and Nightclub is photographed in San Jose, Calif., on Friday, July 30, 2021. (Anda Chu/Bay Area News Group) (Anda Chu/Bay Area News Group)
The properties are located at 91 and 97 East Santa Clara Street, documents on file in Santa Clara County Superior Court show.
For numerous years, retail, restaurant and residential tenants have leased space in the building.
In February 2023. the VTA filed an eminent domain proceeding to seize the property.
The transit agency claimed in the lawsuit that it needed the properties at North Third Street and East Santa Clara Street to facilitate its proposed Downtown San Jose BART station.
The defendants in the VTA lawsuit are property owner Goldrock Holdings and building tenants Mexico Bakery; 3rd and Bourbon restaurant; and Enso Nightclub and Bar, court records show.
Mariam Jalil, a principal executive with Goldrock Holdings, said she is dismayed by the VTA’s actions and its formal lawsuit against owners of the property and its merchants.
Jalil said the VTA has even approached tenants directly to coax the occupants to exit the property as soon as possible.
“VTA has been directly approaching the tenants,” Jalil said. “That creates uncertainty for tenants. It’s disruptive. The vacancy goes up and loss of income happens. It has affected the businesses also, much ahead of any condemnation.”
The Downtown San Jose BART station appears to be years away from opening, especially since delays and cost overruns now haunt the ambitious rail project.
The VTA has stated on multiple occasions within the last few months that it doesn’t comment on current litigation such as unresolved eminent domain proceedings.
One of the main battles that are underway in court centers on whether the VTA should be able to grab possession of the property before the court decides on the overall merits of the eminent domain proceeding.
The amount that the VTA should pay to compensate the property owner for the loss of the site would be one of the ultimate decisions to come out of the court case.
In a December 2023 filing, real estate appraiser Terry Larson estimated the property’s value to be $6.5 million.
Next up: A late March pre-trial hearing. The case’s trial is slated to begin in late April.
Jalil believes the VTA has harmed the value of her property and the business prospects of her tenants.
“For years VTA has created this uncertainty in the area, while they keep delaying the project,” Jalil said.