SAN JOSE — The owner of a San Jose apartment complex that’s weighed down by a failed real estate loan might be able to hang on to the property because the site’s lender appears willing to hold off on a foreclosure — at least for now.
The Neo on First, a 50-unit residential site at 975 South First St. near downtown San Jose, is in default on a $21 million loan that lender CTBC Bank provided to the complex in 2017.
Neo Assets, a Cupertino-based business entity, owns the apartment hub. Xuhan Yu is listed as the entity’s chief executive officer, according to state public documents.
Over the last year, some signs of weakness have emerged in the Bay Area apartment market, including foreclosures and mortgage defaults due to delinquent loans for residential hubs.
In January 2026, the Neo Assets business entity filed for bankruptcy in a last-ditch gambit to ward off a foreclosure.
The gamble might pay off, temporarily, anyway. CTBC Bank is willing to delay a foreclosure proceeding, a Feb. 26 bankruptcy court filing by CTBC shows.
In the filing, CTBC sketched out a series of failures by the apartment hub’s owner to pay back the financing that the lender provided for the property.
The original financing was intended to serve as a construction loan for the residential project.
The developer failed to complete the project’s construction on time. The developer sought more time and money to complete the apartments, as well as more time to repay the loan. The apartments were completed and opened to tenants sometime around mid-2021.
“Neo Assets could not get the job done and requested not one, not two, not three, not even four, but over seven more extensions of time,” CTBC Bank stated in its filing.
The bank granted even more concessions and extended the maturity date of the loan to May 2025. Yet by the time the loan matured, the project’s owner still wasn’t able to repay the loan, despite the many delays and forbearances.
“Neo Assets requested another, this time the eighth, extension of time,” CTBC Bank stated in the court filing. “With just three more months, this time the debtor really could repay the bank, or so it said. And the bank believed the debtor.”
However, the loan remained unpaid despite the next maturity date passing.
“Having had more than its fill for a loan that should have been repaid in 2019, the bank began foreclosure proceedings,” CTBC Bank stated in the court filing.
Now, the lender has proposed a plan for reduced payments for an unspecified number of months to give the owner of the apartment complex more time to find a buyer for the residential property.
“The debtor (Neo Assets), which believes its property is more than sufficient to pay the bank in full and which began marketing the property before the bankruptcy filing date, gets the opportunity to prove it’s right,” CTBC Bank states in the filing.
CTBC said it would hold off on immediately pursuing a foreclosure. The bank also demanded monthly operating reports to ensure the property owner was collecting and handling rents properly.
“The debtor obtains a ninth chance to repay the bank,” CTBC Bank stated in its court filing.