Nearly $100K in fines still isn’t pushing this San Jose church owner to fix downtown eyesore

For years, the century-old church on East St. James Street has languished in significant disrepair, and as winds billowed Thursday through the ripped white and black plastic wrap that envelops the building, a chain-link fence surrounded the weed-filled property and an RV sat parked inside.

Now, the China-based property owner of the downtown San Jose church could end up with an eye-popping bill from the city.

Z&L Properties, which owns First Church of Christ, Scientist at 43 East St. James St. and whose principal executive is mired in a bribery scandal, has already racked up around $85,000 in penalties for allowing the house of worship to deteriorate. But city leaders say Z&L is still sitting on their hands, despite repeated outreach.

As a result, San Jose is considering upping its penalty cap for neglectful property owners, from $100,000 to half a million dollars, with the hopes that it compels Z&L — and others like it — to fix up their site. The city is also considering ways to take over the property — though officials said that may be legally complicated.

“Behind me is a symbol of negligence that will no longer be tolerated in the city of San Jose,” said Mayor Matt Mahan on Thursday standing outside of the church. “What is a beautiful, historic landmark has become an eyesore.”

The Neoclassical-style church was first built in 1905 and has sat empty since 1975. It was bought in 2017 by Z&L, which then covered the church in scaffolding with plans to revamp the site. But today, the church has become a symbol of dilapidation with its white pillars and dome obfuscated by plastic wrap that itself is tearing apart.

Z&L, a real estate firm based out of China with a Fremont-based office, was unable to be reached for comment. A phone number was listed as out of service.

“My office (and) my team has been flooded with emails and with calls about what our constituents call the ‘trash bag church,’” said Councilmember Omar Torres, who represents the city’s downtown neighborhood, during Thursday’s press conference. “I will not allow for this significant, historic property to deteriorate. We are giving our residents false promises about our abilities to address significant blight issues in our city.”

Ben Leech, executive director of the Preservation Action Council of San Jose, said the city could reuse the church in several ways to revitalize the St. James Park area.

Though the building has sat dormant for years, the structure hasn’t been heavily damaged from water or mold, according to Leech.

“A performing arts center, movie theatre, church, community center, museum, night club, restaurant…it really could be anything,” said Leech in an interview. “We would be encouraging some sort of community-serving space. (There are) Two questions: What is the best use of this building? And what is the most profitable use of this building? We hope there’s a happy medium.”

The proposal, which will go before the Rules Committee on Aug. 30, is the second time the mayor has tried to pressure property owners to clean up their buildings. Mahan said the code enforcement department will be conducting proactive searches of blighted properties in downtown starting this month. Instead of residents submitting complaints about rundown buildings, code enforcement officers will patrol the area and issue fines to violators.

The church is just one of Z&L’s purchases over the years in downtown San Jose and San Francisco — and marks a pattern of struggling real estate projects. The firm sold a 1.6-acre property in 2021 near the corner of Terraine and Bassett streets in San Jose — and plans for a large residential building there have stalled.

The company also has failed to build a high-rise it had planned for at the old Greyhound station on 70 South Almaden Ave. in downtown — and recently put the property up for sale.