From a plugged-in tipster today:
351 California is one of the Dollar buildings (forgot which one), later the Pacific Bank Building, and currently the HQ [of] Brugnara Properties. Luke Brugnara is one of the most storied characters in the commercial real estate scene. The building is scheduled for the courthouse steps 14 November with an outstanding loan balance of $33,377,682 per PropertyShark.
From Brugnara seven months ago: “I own 351 California and am not in default.”
Just google this buy to find out a lot of interesting information. He once controlled the 490 Post Street medical building, which he lost to the lenders. He paid a big fine to the City for mixing the medical waste with the solid waste because he was too cheap to pay the solid waste contractor. I heard the medical waste fee that he wasn’t paying was only around $2,000 per month.
Years ago, I heard stories that he would make personal visits to his tenants to collect the rent payments.
Then there were his run-ins with the Nevada Gambling Commission regarding his desire to own and operate a casino…he was denied the requisite license.
One apparently successful deal: he bought the Furth Building (201 Sansome) and sold it to the developers of the condo project that sits there now. I haven’t looked-up the numbers but I suspect he came-out OK on that one.
The Brugnara entity which owns this building filed a Chapter 11 bankruptcy case on October 31, so the foreclosure is stayed. The filing indicates that there are two loans against the building: the first is $33 million, the second is $11 million. The filing claims the building is worth $50-$55 million. The loans are both held by what looks like a hard-money lender from Las Vegas; both loans have high interest rates and were funded within the last year. They are cross-collateralized by Brugnara’s personal residence and a piece of undeveloped land in Gilroy.
My guess is that the stay lifts and there is a foreclosure in about 120 days.
Luke Brugnara knows more about commercial real estate deal making than anyone in SF. He has bought and sold more than 20 properties over the last two decades for hundreds of millions of dollars of profit. I see from the records that he bought the building for less than $20M a few years ago; so he made a killing on this property as well.
D. Gump you sound like Luke’s publicist. He has, indeed, made lots of money, however, it looks like he’s going to lose even more. FYI, 351 California is not worth $50 to $55 million or anything close. MAYBE, it’s worth $20 million. That may be optimistic. He has mismanaged that building so spectacularly that he has impaired its value for some time. Not to mention all SF real estate has fallen in value over the last 90 days 15% to 25%.
[Removed by Editor]….no lender would make a $44M loan on a property worth $20M….[Removed by Editor]
[Editor’s Note: Attack the argument not the individual.]
Your assumptions of value for SF CBD downtown real estate is grossly off base. 235 Pine Street just closed escrow last week for $370/sf and a 3% CAP rate…there hasn’t been a sale in the last year in CBD less than that price per sq. ft, with the average between $400 and $500/sf and 2.5-3.5% CAP rates. The replacement cost for a building in CBD is now over $1,000 sf, if could ever find a lot to build on…with its irreplacable corner location at California and Sansome Streets Brugnara Corporation Building is worth $60M-$75M, or more, based upon factual data of real comparable sales, not supposition from “haters”. Luke Brugnara is a hero to many who aspire to be successfull, that is why he garners so much publicity…and no I am not his publicist, just a fan who follows his activity-just like you.
dgump, thanks for that info on 235 Pine. Would you be able to share with us any particulars about that sale (eg, financing, etc)? I understand the cost to build in the city (even if I believe those costs are unsustainably high and must come down). What I think many of us don’t understand is who is buying today at a 3% cap rate and why? What are their assumptions? And who’s still lending on projects like this and on what terms?
As a former tenant of Brugnara’s I can tell you his company is completely unethical. He locked us out of our space when our lease termed and we were unable to retreive equipment belonging to us that the movers left behind. It’s the worst experience in my career dealing with a landlord
Gov’t: Land Investor Did Not
Report $45m
The owner of the San Francisco-based Brugnara Corp. has been charged with
filing false tax returns and failing to report more than $45 million in gains
from real estate sales.
According to the indictment, Luke D. Brugnara is the sole owner and
shareholder of Brugnara Corp. and Brugnara Properties I, II, III, IV, V and VI
(Brugnara Properties). During the tax years 2000, 2001 and 2002, Brugnara
sold four properties in San Francisco and one in Las Vegas. But he failed to
report capital gains of $45.6 million from those properties.
If convicted, he faces up to three years in prison and a fine of up to
$250,000, plus restitution.
I hear that the Goverment case regarding Brugnara’s taxes have been resolved as no taxes were due…I hear that Brugnara is getting an extension of his existing loan on 351 Calif. in BK…I read Luke Brugnara has done over $1B in deals without any patners or BKs or foreclosures; you haters need to get a life and appreciate and admire Luke Brugnara for his success and accomplishments…I’m sure none of you have done anything near the magnitude of Mr. Brugnara..I am a loyal fan of Luke Brugnara!
I hear that the Goverment case regarding Brugnara’s taxes have been resolved as no taxes were due…I hear that Brugnara is getting an extension of his existing loan on 351 Calif. in BK…I read Luke Brugnara has done over $1B in deals without any patners or BKs or foreclosures; you haters need to get a life and appreciate and admire Luke Brugnara for his success and accomplishments…I’m sure none of you have done anything near the magnitude of Mr. Brugnara..I am a loyal fan of Luke Brugnara!
I hear that the Goverment case regarding Brugnara’s taxes have been resolved as no taxes were due…I hear that Brugnara is getting an extension of his existing loan on 351 Calif. in BK…I read Luke Brugnara has done over $1B in deals without any patners or BKs or foreclosures; you haters need to get a life and appreciate and admire Luke Brugnara for his success and accomplishments…I’m sure none of you have done anything near the magnitude of Mr. Brugnara..I am a loyal fan of Luke Brugnara!
I hear that the Goverment case regarding Brugnara’s taxes have been resolved as no taxes were due…I hear that Brugnara is getting an extension of his existing loan on 351 Calif. in BK…I read Luke Brugnara has done over $1B in deals without any patners or BKs or foreclosures; you haters need to get a life and appreciate and admire Luke Brugnara for his success and accomplishments…I’m sure none of you have done anything near the magnitude of Mr. Brugnara..I am a loyal fan of Luke Brugnara!
I hear that the Goverment case regarding Brugnara’s taxes have been resolved as no taxes were due…I hear that Brugnara is getting an extension of his existing loan on 351 Calif. in BK…I read Luke Brugnara has done over $1B in deals without any patners or BKs or foreclosures; you haters need to get a life and appreciate and admire Luke Brugnara for his success and accomplishments…I’m sure none of you have done anything near the magnitude of Mr. Brugnara..I am a loyal fan of Luke Brugnara!
this would trade for somewhere in the mid-high $100s per foot today… what sort of bozo would try to call this a comp to 235 Pine? nobody can really figure out what TA was thinking there anyway, but at least 235 is amongst the very best construction in the city, with 100 parking spaces in the north fi to which your per pound price didn’t assign a value no less… 351 is a deathtrap…wander into the lobby and you’ll notice even the ground floor isn’t sprinklered… 351 has steam radiators that knock, no AC, 20-30 year old interior improvements, etc… can’t believe brugnara hasn’t tried to burn it down for the insurance $$$
I understand that Brugnara is giving the property back to his lenders for $48M and they will foreclose….137,500 sf = $350/sf….not bad for Brugnara who paid only $20M for it 10 years ago.
Yeah, this guy owns 351 California too, which I used to work in. They were unfriendly to their tenants and we couldn’t wait to move out.
I sense a lot of envy among various posters regarding Luke’s accomplishments. You can only fantasize about everything he’s done in his life. The man is is an original, completely self made and a genius when it comes to doing the impossible. Not to mention a dedicated family man. Why don’t you all go take your insecurity, jealously and negative sentiments elsewhere. And be patient. Luke will soon rise again like a phoenix and you’ll have ample opportunity to loathe the man you will never be.
I wonder if anyone knows who his lawyer is? I’d like to buy one of his properties. Any suggestions? I think he is very smart. He works the market/economics to his advantage. He may have had poor property management skills and may have made poor decisions. Who hasn’t. Real Estate is a tough industry. Cut throat. Ruthless. You don’t get to being a player, by playing nice. Maybe adding to his genious, these situations will make him smarter. He’ll delegate to reponsible people that know their strenghts. He’s our local Trump. He will come back stronger. Any in his words, even more “Pissed off”!!
Looks like Mr. Brugnara is going to jail for 18-24 months for tax evasion/fraud. Ain’t that a shame!
http://www.bestdefender.com/news/May09/19a.html
Your wishful envious comments about Luke Brugnara’s incarceration are incorrect….he filed a recission of his plea in Federal Court and will be doing no time and will not be convicted of any crime…you posters are pathetic losers who are jealous of Brugnara for his accomplishments which are too numerous to list here….PS–his name is still on all three sides of 351 California Street — he still owns the majority stake of that building.
dgump: Gee, Luke, are you so insecure that you have to stoop so low as to post your own defense here on this insignifcant little corner of the interwebs?? Pitiful.
However, it looks like you will, in fact, have to spend some time in your room for all the fraud you’ve committed over the years.
I am neither Brugnara, nor work for him…like many posters on this site, I admire Luke Brugnara for his success as a businessman because he never compromised his orginality or persona to achieve his goals. Unlike you, not all persons are jealous and envious of Luke Brugnara’s success.
“he never compromised his orginality or persona to achieve his goals.”
translation: another bull market genius who thought that entitled him to be an ass.
Please…none of you have ever met Brugnara; he is a gentleman and a very nice person..very down to earth.
One of the definitions in the Dictionary of a victim is “one that is tricked or duped”. That is exactly what Luke did to me. I am a small flooring contractor that installed hardwood flooring at 351 Cal. for him a couple years back. I did the job for a small profit so to do other work he said he would have. Then he never paid me the $14000 owed. To a big “Player” thats not much money but to me it is alot. And it hit me hard at a bad time. Just a warning to other folks out there Dont be a victim and do business with Luke Brugnara. He is a crook.
Luke is a generous person he donated over $500K to Catholic Charities a few years ago to help feed and house the poor families in San Francisco.
I was a tenant of Luke’s and couldn’t pay rent one month because of personal (family) medical bills for my daughter, and Luke forgave the rent and allowed me and my family a break during the holidays..I will never forget what a nice gesture that was, and he never asked for the rent back at a later date.
Yes, that is true about Luke….Luke gave our company 50% discount rent (from the lease rate) becuase my husband got ill and we were losing our business. Luke helped us stay in business by giving us that rent discount and he never asked for anything in return, or asked for the money to be paid back.
Luke is a great guy. He has been the model for commercial real estate success in San Francisco for almost 20 years. I remember I read in SF Magazine a few years ago that he bought 490 Post Street in 2000 for $21M and sold it one year later for $48M, he made something like $25M on that one deal alone….I was in Las Vegas and saw his casino in 2002: Silver City Casino– it was cool with all of the old western figures and wild-west design..I met Luke once in front of 351 Calif. St. and he was wearing sweatpants and a t-shirt…he was friendly and looked like a normal guy.
RealtyTrac indicates that 224 Seacliff Ave. (owned by Brugnara Properties VI) has a date at the courthouse steps on February 24.
“he filed a recission of his plea in Federal Court and will be doing no time and will not be convicted of any crime”
“I hear that the Goverment case regarding Brugnara’s taxes have been resolved as no taxes were due.”
These two shill comments were impressively wrong and just part of the spin machine. Brugnara was unable to have his guilty plea set aside:
http://www.leagle.com/xmlResult.aspx?xmldoc=in%20fdco%2020100503760.xml&docbase=cslwar3-2007-curr
Among other things, he refused to pay his attorney, but also the judge determined that he was trying to game the system and delay his case. You can also see that he was out of custody when the shill comments above were written.
He also was found guilty of not paying taxes in the end:
http://www.aolnews.com/2010/05/28/jail-ordered-for-man-who-cooked-taxes-poached-fish/
Luke Brugnara sounds like a brilliant and a force that can not be stoped. I have never met him but have read many articals about him and I can honestly say he is a true original and is a great inspiration to people that understand his methodology and way of thinking.What has happened to him in the past year is wrong and in the end I have no doubt that he will come back, GO LUKE!!!!!
“what has happened to him in the past year is wrong and in the end I have no doubt that he will come back, GO LUKE!!!!!”
Incidentally, the article I posed above, dated 5/28/10, said that Luke Brugnara was going to jail for 15 months. Sounds like maybe he got out 2 months earlier for good behavior?
Mr. Brugnara plead guilty January 26, 2010 and was sentenced May 24th 2010 after his attempt to rescind his second guilty plea (he’d already plead guilty and rescinded it once) was denied. His appeal of this decision to the Federal appellate court was denied Oct 27, 2011.
http://www.justice.gov/usao/can/news/2010/2010_05_24_brugnara.sentenced.press.pdf
http://www.leagle.com/xmlResult.aspx?xmldoc=in%20fdco%2020100503760.xml&docbase=cslwar3-2007-curr
http://www.ca9.uscourts.gov/datastore/memoranda/2011/10/27/10-10283.pdf
It appears that in the middle of the case he wasn’t paying his lawyer and was caught breaking the terms of his “house arrest”, but these seem to have been worked out amicably.
I heard through the grapevine that Luke Brugnara is back doing deals and is stronger than ever …..I heard from one of his workers that there will be a major announcement soon about a major development that he has recently put together..
Yes this is true; I spoke to one of Luke’s workers last week at our office and he told me Luke Brugnara just secured a major credit facitlity for a huge project from an international banking group and will be making an announcement very soon….he also told me that Luke looks great!!!
I wonder how much astroturf like this costs?
The comments of Scorercrd, mjp, & dgump on this article appear to be Luke Brugnara. The comments from Scorecard, Scorercard & MJP on this related article also appear to be Brugnara himself:
I’ve heard him speak and it sounds just like him. This guy is absolutely pathological! It’s now 2015, and on 9/8/15 at 2pm, LuckyLukeBrugnara is scheduled to be sentenced in Judge Alsup’s courtroom for being found guilty on 6 of 9 counts to include mail fraud, wire fraud, escape & contempt. He was facing up to 115 years in prison for telling Rose Long he wanted to buy her art and put it in his museum. A museum he doesn’t own. He is destitute. I saw his entire trial. He’s a piece of work. He yelled at the judge daily, lobbing insult after insult to Alsup and Robin Harris, the prosecutor. He disrespected the entire justice system with his act of “defending himself.”
He put on absolutely NO defense. After telling the jury he would testify because he had “a lot to say.” He stalled as long as he could, then said nothing to defend why he stated he would buy someone’s $11M art collection for a museum when a year prior he filed reports with the court that he had nothing: no money, no assets, no income, no potential. One letter he wrote to a probation officer for her to include, or use for her own report, suggested he was likely going to have to be a high school coach because he was done…all washed up with no potential to earn money in the future. (Probably, the only true thing he ever wrote!)
One of the jurors on his trial had to be expelled from the case for lying about his prior arrest record. When everyone was asked to leave the courtroom so they could ask about the juror’s criminal history, he was overheard telling the judge he was accused of rape when he had sex with a prostitute and refused to pay her the agreed rate. She later dropped the charges, yet he didn’t disclose the arrest up front. Brugnara was later found guilty once the juror in question was removed and the replacement lady was brought in, because the guy who Alsup removed wanted to vote not guilty. He screamed Brugnara was “innocent because he was Italian” He also screamed the jury was prejudice against Brugnara because he was Italian. (If you haven’t guessed, the crazy juror was an immigrant from Italy or close to it).
They removed him and took him to the hospital for a psych eval. In true Brugnara fashion, he approached the juror before his removal…clapped his hands repeatedly in the guy’s face and told him, “you’re not helping me here!” Alsup gave Brugnara an additional 90 days for contempt for that stupid stunt. Brugnara racked up over 470 days in jail for contempt! How do you not posses any self control Mr. Brugnara?
This guy may have had a moment of brilliance in his past, but whatever he’s been smokin’ over the years has made him look worn and old, way older than his years, and crazy as all heck. Brugnara gives new meaning to the term crazy eyes – they’re black, cold, and dead. Sorry Luke, I guess you’re luck just ran out!