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Page Mill investors sue firm over millions

Original post made on Apr 1, 2010

Palo Alto-based property manager Page Mill Properties committed securities fraud, misled its investors and engaged in an illegal and "morally offensive" plan to gentrify a portion of East Palo Alto, a group of Page Mill's investors is alleging in a lawsuit against the beleaguered real-estate company.

Read the full story here Web Link posted Thursday, April 1, 2010, 5:36 PM

Comments (16)

Posted by Chris Lund
a resident of East Palo Alto
on Apr 1, 2010 at 5:59 pm

Please visit for more information on Page Mill Properties, the East Palo Alto apartment portfolio, and this lawsuit.

Posted by EPA resident
a resident of East Palo Alto
on Apr 1, 2010 at 6:11 pm

I am glad to see the Daily cover this. It confirms what everyone who lived in a Page Mill Apartment already knew: David Taran aka Page Mill appears to be a thief and a fraud. The truth needs to come out on this one. Calpers gave $100 million of public retiree money to this scheme that was illegal. Where is the District Attorney? Where is the Attorney General?
The SCC? Someone should be behind bars.

Oh, and shame on you Mr. Morgan for trying to blame this on "general market conditions." People who saw Page Mill in action know that they were not trying to play by the rules, or by the market. Someone needs to dig more here.

Posted by interested party
a resident of East Palo Alto
on Apr 1, 2010 at 6:55 pm

While it's clear that David Taran is greedy, deceitful, and ruthless. I'm not buying it for a minute that these other folks who lost their money were clueless about what they were getting into. Let's be honest, if the nasty predatory equity scheme had worked out as planned, we wouldn't have heard a peep out of these folks.

Posted by Reader
a resident of Community Center
on Apr 1, 2010 at 8:19 pm

EPA Resident,

It's the Weekly, not the Daily, that developed the story. Give credit where credit is due.

Posted by Hmmm
a resident of East Palo Alto
on Apr 1, 2010 at 8:28 pm

I think it's sad, ironic and funny that all the super smart, experienced investors suing the carpetbagger Taran didn't know EPA has rent control. It has for 22 years. It's one of our community values, which is why it exists. You can Google East Palo Alto rent control and see the current ordinance online. Not that these people deserved to be ripped off, but it seems apt that they were duped about something that us thousands of less educated, less monied, less powerful people know.

I hope that they win in court, as they deserve. Moreover, I can't wait to read about the feds getting involved in investigating all of this corruption.

EPA is not here to be gentrified by outsiders. We are steering our own course, steadily, with challenges and setbacks, but with dedication and commitment. It is OUR value to keep homes affordable and we have worked to that end and continue to do so. Perhaps if Taran's investors weren't motivated just by greed, they could've performed additional due diligence to make sure Taran wasn't conning them. But instead, they went for it, and have lost so much. Many of us surmised they were likely operating at a loss and might fail in their scheme, once we all saw how much property they were buying. Not that long ago I was posting on this forum how bad things were, that PMP couldn't be trusted, that the scheme was shady and so many supposed better informed types jumped all over my posts, as well as others who posted criticism. So many non-residents operated by their assumptions, dismissed our concerns, complaints and accumulated knowledge and experiences with PMP. Funny how people think they know better than us here in this community.

Posted by Will never invest in EPA
a resident of Old Palo Alto
on Apr 2, 2010 at 9:05 am

What EPA residents who ousted Page Mill fail to understand is that they scared the @#$% out of future investors. Nobody in their right mind will consider investing in properties or businesses in EPA. So go ahead and "gentrify" EPA with your own means, EPA residents.

Posted by anon
a resident of Menlo Park
on Apr 2, 2010 at 9:45 am

Actually, the Daily wrote the story last week.

Posted by Resident
a resident of Menlo Park
on Apr 2, 2010 at 9:46 am

As Hmmmm points out, "You can Google East Palo Alto rent control and see the current ordinance online."
According to the article, the investors included "more than a dozen experienced real-estate developers". And supposedly at no point during their due diligence did these investors bother to investigate housing laws in the area? Ridiculous.
They are only complaining now because they got caught.

Posted by SP
a resident of East Palo Alto
on Apr 2, 2010 at 10:58 am

To "Will never invest", well, you are wrong about whether people will invest here. I have, and many others have, and are doing just fine. Home Depot, Ikea, and certainly Mi Pueblo are not bemoaning their investments here.

If you haven't been to Mi Pueblo, you gotta go, its really a great place to shop. The food is great, and really unique, and prices are great too.

PMP was not investing, it was attempting to do gentrification on a grand scale, a reverse "block busting". They started from day one promising investors 20%+ returns. That should have been a huge red flag for everyone, including the investors. 20% return is a ridiculous number, certainly you can't do that under rent control. It isn't rocket science to figure out what was going on.

The whole deal is fishy. David Taran is an advisor to the bank that made the loan that is being called. He got these guys to back the loan with no money down. In other words, they keep the money in their own account, but they still get a return on their "investment", and they only have to actually give up their money if the whole thing falls apart. The money from the bank was used to make payments on a different loan from another bank. I bet the banks are not too happy about hearing that. The whole thing smacks of Ponzi.

Posted by Hmmm
a resident of East Palo Alto
on Apr 2, 2010 at 12:53 pm

We never ousted PMP. Their predatory equity scheme, predicated on the inflated rela estate market, collapsed with the market. They got what they had coming to them.

Gentrification is a gentirfied word for predoary scheming in this case. What they did was illegal and morally indefenisble.

EPA needs to continue to learn to steer its own course, and protect itself from carpetbaggers.

Posted by Hmmm
a resident of East Palo Alto
on Apr 2, 2010 at 1:11 pm

SP, you nailed it! The whole scheme has unraveled. I wonder if Taran's wife's "Happiness Project" organization can leerage this unique opportunity to get differing views on what happiness means to different people and how much money plays a role in happiness. Or greed. Or conning others. Not to mention lying to potential investors, harassing tenants, evicting them illegally, and oh, yes, illegally spying on tenant activists as well.

Posted by ann
a resident of Los Altos Hills
on Apr 2, 2010 at 6:06 pm

epa resident....2nd comment ....calpers lost 100 million of this caper....that is completely you have any more info on this or a reference or link that i could go are right....someone has some explaining to do...

Posted by Crescent Park Dad
a resident of Crescent Park
on Apr 4, 2010 at 6:57 am

Rationally speaking it is much more difficult to attract residential investment in a rent controlled city. Whether the investment sources come from in or outside the community, a savvy investor does not like the idea of having a hand tied behind one's back. There has been some very nice commercial/retail investment in EPA - but those investments are not hamstrung by residential rent control.

The reality is, like it or not, successful real estate development in EPA will require monies from resources outside the city. In order to have nicer rental properties or apartment buildings, the city may want to consider policies that draw investors but still protect renters.

Posted by Hmmm
a resident of East Palo Alto
on Apr 5, 2010 at 9:33 am

Crescent Park Dad- your posts are always thoughtful an rational - thank you. I know there is a definite downside to rent control, yet I understand and share it as a value in EPA. There are some good options for landlords and incentives to keep properties up, mostly aimed at mom and pop type landlords. Being a landlord is never particularly easy, but at least the folks who have bought in EPA since 1988 had the awareness of rent control and it was their choice to purchase.

The City has been looking at various options. Being vulnterable to PMP via loopholes and an army of attorneys hasn't been easy on the City of residents. What I struggle with is that outsiders rarely see or acknowledge the pros of rent control, and there have been definite pros, but it's not for someone looking to make a fast buck.

I also must say that in a rent controlled city, renters have plenty of rights and therefore are often more willing to be active in the community, walk their talk and contribte to the wellbeing of the whole community. There is such a discrepancy between homeowners and renters in so many places, that rent control actually evens that out a bit, even if it's just by the awareness a tenant has of their rights. It's tiresome to be treated as someone w/few rights because of renting.

Posted by JC
a resident of East Palo Alto
on Apr 10, 2010 at 8:24 am

PMP deserves everything that is happening to them. The words I used to describe them at a Cal PERS Board Meeting are, "dishonest," "manipulative," and "use tactics of intimidation and harrassment."

There is a real need for affordable housing. People in PA and MP and other well-to-do communities have a very pleasant way of life, in part, because of the low-cost labor done by people in low-income communities like EPA. EPA residents work in grocery stores and restaurants, do yard work, clean houses, take care of children, work at Stanford Hospital, work as crossing guards, and do many other jobs that are essential for the survival of well-to-do communities. People who provide this labor need places to live that they can afford.

Posted by Name hidden
a resident of Menlo Park

on Jul 27, 2017 at 9:22 am

Due to repeated violations of our Terms of Use, comments from this poster are automatically removed. Why?

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