SAN FRANCISCO-The U.S. Department of Housing and Urban Development stands to turn a profit thanks to a funding mistake made by the City of San Francisco in 1999. The deal violated federal funding laws. The City is asking that a resulting $400,000 penalty be forgiven.

SACRAMENTO-The Sacramento rental market has been steadily declining but investors are not scared off by the numbers. Sobrato Development Cos. purchased a $50 million apartment complex less than two months after purchasing a $53 million complex.

SAN FRANCISCO-The Leland Hotel, a Polk Street residential/retail complex, has been sold to Mercy Housing California, one of the nation's largest developers of low-income housing.

MILPITAS, CA-The City of Milpitas has filed a lawsuit against the City of San Jose in an effort to halt development of a proposed 180-megawatt power plant slated to be built in North San Jose.

SANTA CLARA, CA-The digital multimedia company takes advantage of the market, subleasing 80% of a 75,000-sf office building from the Texas-based software firm Entrust Inc.

SOUTH LAKE TAHOE, CA-Colorado-based Vail Resorts has purchased Heavenly Ski Resorts from American Skiing Co., who will use the money to reduce its debt. A $25 million gondola sweetened the deal for Vail Resorts.

SAN JOSE-Two retail properties in the Bay Area were purchased by individual investors, showing that in comparison to other commercial sectors the retail market is holding up very well.

SAN FRANCISCO-Two ordinances have been passed by the San Francisco Supervisors that will limit developers in building big-box retail projects and new live-work lofts in the city.