By Jason Cruz
Northwest Asian Weekly
Former monk, turned developer Lobsang Dargey is under investigation for possible fraud charges and as a result, the purchase of a commercial development in South Seattle that would revitalize the area near the Othello light rail station may not go forward. This has drawn the ire of the Seattle Housing Authority who are at odds with Dargey and his development company for not coming through on its promises.
Dargey is president of Path America, an Everett-based company that works with non-U.S. citizens that wish to immigrate to the United States through the EB-5 immigrant investment program. The program allows for entrepreneurs to apply for a green card if they make an investment in a commercial enterprise in the United States and plan to create or preserve 10 permanent full-time jobs for qualified U.S. workers.
Dargey, who was a former Buddhist monk from Tibet, came to the United States not knowing how to speak English. His first job in America was painting an orthodontist’s office in Federal Way per a Seattle Times feature on him in 2012. From meager beginnings, Dargey became a real estate developer. He is married to Tami Agassi, the sister of the famous tennis star Andre Agassi.
Three civil securities fraud complaints by the Securities and Exchange Commission had caused assets related to several of Dargey’s projects to be frozen. The most notable is Path America’s $190 million Potala Tower in downtown Seattle. The SEC believes that Dargey has been defrauding mainly Chinese investors through his commercial projects and using millions of dollars for his personal use. Dargey is accused of taking $17.6 million of investors’ money and misusing most of the money to acquire other properties as well as for his own personal use.
Specifically, he was accused of using $2.5 million of investor money to buy a house in Bellevue and withdrawing $350,000 in investor funds including $200,000 at casinos. The freezing of funds by the court has put several Dargey projects in jeopardy.
The Seattle Housing Authority has let Path America know that the proposed sale for a 500-unit apartment project with a farmers’ market for the South Seattle property near the Othello light rail station will not extend past a Nov. 1, 2015 deadline. According to Kerry Coughlin, SHA Communications Director, Path America has not met milestones outlined in the Purchase and Sale Agreement for the property.
SHA sent a letter to Path America on Aug. 27, 2015, notifying it of a “Default of the Real Estate Purchase and Sale Agreement” outlining that it has not met conditions and milestones of the Purchase and Sale Agreement entered into on March 13, 2015. Path America responded, stating that it still wanted to go through with the acquisition.
According to Coughlin, SHA sent another letter last week reiterating that it still had not met its obligations. No response had been received from Path America to the second letter from SHA yet. Coughlin stated that Path America was to have submitted plan and design reviews to SHA among other information in order to purchase the Othello property. Additionally, Path America was to have provided SHA a complete financial overview of the financing for the project 30 days prior to the closing date of Nov. 1.
SHA is scheduled to sell 3.2 acres of land near the Othello light-rail station for $7.5 million to Path America with a closing date of November 1st. According to the Purchase and Sale Agreement, Path America has already paid $270,000 in earnest money with the intent of purchasing the land. If Path America does not come through by Nov. 1, it will lose the $270,000. The intended development would have brought mixed-used buildings of apartments and retail space. Overall, experts had projected the land development costs to run in excess of $100 million.
“Our intention is to go back to market,” Coughlin stated if Path America allows the Nov. 1 deadline to expire without meeting any of the terms and obligations. This would mean SHA would look for other developers that would be interested in a similar project to the one agreed upon with Path America. (end)
Jason Cruz can be reached at email@example.com.