Stockton Development Defaulted on Office Building Loan

The developer failed to repay a $3.4 million loan on a San Francisco property it purchased for $18.3 million.

Updated on Sept. 23, 2026 in Commercial

The concrete facade of a mid-century office building with repeating rows of windows under a gray, overcast sky. — Stockton Development faces a notice of default on its 43,000-square-foot office property at 2300 Stockton Street in San Francisco. AI Illustration. Upload story photo >

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Stockton Development received a notice of default after failing to repay a seller-financed loan on its 43,000-square-foot office building at 2300 Stockton Street. The debt reached $3.6 million when the notice was filed with the San Francisco County Assessor Recorder's Office.

Why it matters

The developer intended to convert the 1970s-era office building into 70 residential units, a project that supports the city's broader push to increase housing stock. However, the missed maturity date on the loan has stalled progress on this conversion effort.

Stockton Development purchased the building for $18.3 million in May. The property spans 43,000 square feet and is slated for 70 new residential units.

The players

Stockton Development

This real estate developer is currently working to convert a commercial office building into residential units.

Academy of Art University

This educational institution previously owned the office building at 2300 Stockton Street.

Thousand Architects

This design firm submitted the initial redevelopment plans to transform the site into residential housing.

The details

Stockton Development, which has already filed redevelopment plans for the site, claims it intends to clear the debt in the coming weeks. The property is currently an office building that has been the focus of conversion efforts to help reach the city goal of 82,069 new housing units by 2031.

December 2025: Thousand Architects filed redevelopment plans for the site.
May 2026: Stockton Development purchased the building from Academy of Art University.
June 2026: Academy of Art University listed a building at 60 Federal Street.
September 23, 2026: The notice of default was served.
2031: The city deadline for reaching 82,069 new housing units.

Culture Shift

This project reflects the growing trend of adaptive reuse, where developers seek to transform aging commercial office space into residential housing. It is a critical component of the city's housing goal of 82,069 new units by 2031.

The delay in this conversion project means the neighborhood will wait longer for the planned arrival of 70 new residential units. Residents should monitor future public filings to see if the developer succeeds in clearing the debt and restarting construction.

The takeaway

Real estate conversion projects often face complex financing hurdles that can disrupt timelines for much-needed housing. Developers must balance high acquisition costs with successful loan management to ensure these residential transitions remain viable.