A little-known auction sale has made South Bay couple Michael Cheng and Tina Lam the owners of one of the most prestigious streets in San Fransisco. The couple won the auction for Presidio Terrace, which is a long and oval private street that’s lined with 34 mansions, each worth several millions. The price they paid for the street? About $90,000.
The reason for its sale was due to the long unpaid tax bill. In the 181 private streets in San Fransisco, the homeowners association is required to pay a $14/year property tax bill. In the case of Presidio Terrace, the tax bill was neglected for three decades, causing the amount unpaid to reach $994.
In 2015, the city’s tax office put the street up for auction in an attempt to earn back $994 for the unpaid taxes. At the time, Cheng and Lam were eyeing real-estate opportunities. When they came across this opportunity they pounced. The bidding started off at the $994 mark but Lam and Cheng eventually beat out the other bidders with the final amount of $90,100.
The purchase of the street means that Michael Cheng and Tina Lam now own the sidewalks, the street itself and other areas of “common ground” in the private development.
Since the purchase in 2015, the couple had been quietly sitting on the property while speaking to land-use attorneys to explore all of their options.
Cheng explains, “We were looking to get title insurance so it could be marketable.” He and his wife see many opportunities to make money on their investment, particularly from the 120 parking spots that they now control.
The residents of this exclusive property value their privacy greatly. Some of the past homeowners include Sen. Dianne Feinstein and her financier husband, Richard Blum; House Democratic leader Nancy Pelosi; and the late Mayor Joseph Alioto.
The homeowners are crying foul over the sale, which they only heard about two years after the fact. According to reports, they were contacted in May by a title search company that is working on behalf of Cheng and Lam. The company wanted to know whether the residents had any interest in buying the property back.
In a letter to the city, Scott Emblidge, the attorney for the Presidio Homeowners Association, said the group had failed to pay up because its tax bill was being mailed to the Kearny Street address used by an accountant who hadn’t worked for the homeowners since the 1980s.
Last month, the homeowners petitioned the Board of Supervisors for a hearing in order to rescind the tax sale. They have also sued the couple and city in order to stop Cheng and Lam for attempting to sell the property while the appeal is pending.
A homeowner who was asked not to be named because of pending litigation has stated, “I was shocked to learn this could happen, and am deeply troubled that anyone would choose to take advantage of the situation and buy our street and sidewalks.”