Developers practices draw questions, complaints

July 21, 2015
John Belsher and Ryan Petetit

John Belsher and Ryan Petetit


Editor’s note: This is the first in a series about developers Ryan Petetit and John Belsher, their development projects, their promises to investors of 20 to 50 percent rates of return, legal troubles, and reported failures to pay subcontractors.

The principals of a San Luis Obispo-based real estate investment and development company involved in more than a dozen proposed projects are under fire for not paying subcontractors, violating building codes and allegedly funneling investor monies into several companies they created without disclosing their ownership to investors.

In 2012, John Belsher, 61, and Ryan Petetit, 28, created PB Companies. Since then, their portfolio has grown to include more than a dozen projects that Belsher and Petetit value at more than $300 million, according to the Pacific Coast Business Times.

“The company was founded to create investment solutions and equity plays in the real estate and business world where the legal and financial expertise of the principals would generate a great climate of success for the company and its investors,” the PB Companies website says.

Petetit and Belsher did not return requests for comment. Rush Sheppel, a partner in several PB Companies’ projects, said that since PB Companies was created in 2012, they have never finished a project or construction of any residential or commercial building.

Petetit and Belsher are involved in several large commercial, mixed-use and residential projects including two subdivisions in Templeton, a mixed-use project at the corner of Marsh and Nipomo streets in San Luis Obispo and an assisted-living facility in Arroyo Grande.

Belsher and Petetit have secured money from banks, hard money lenders and private investors, according to county records. In some cases, investors have been promised rates of return between 20 to 50 percent, according to an email from Petetit to a potential investor.

“The San Luis rezone is going to run us about $400,000-$500,000 we will offer a 20%-50% rate of return or a percentage of the increased value,” Petetit said in a 2014 email. “For example current value is 2M the value of 200 apartments and 70 single family homes will be $15.6M. It will take two years to accomplish this then when we sale [sic] the project or decide to build it out, which we will most likely build it out we return the investment back to the investors plus their returns.”

Investors in a 26-home proposed development in Templeton were procured through San Luis Obispo based Mid-Coast Mortgage with a promise of 10 percent interest, according to the loan broker.

Wright Homes and Communities is building five homes in the Toad Creek subdivision. Wright Homes and Communities, Axis Engineering and PR Companies share the same address. Belsher and Petetit created Wright Homes in 2013 and Axis Engineering in 2012, California Secretary of State website shows.

Vince Crooks, president of Mid-Coast Mortgage, said his company does not write checks to PB Companies. Instead, his hard-money lending company pays the subcontractors working on the projects, he said.

“Every subcontractor has been paid,” Crooks said.

But, several subcontractors who worked on the Toad Creek development said they have not been fully paid though they have received some payment from Axis Engineering or PB Companies.

In the past few years, the partners have been in court over multiple financial controversies such as breach of contract and not paying fines for building violations.

In 2014, Michael Evert filed a breach of contract lawsuit after PB Companies did not pay him $3,859 for remodeling the PB Companies’ office at 3480 South Higuera Street. After the lawsuit was filed, PB Companies negotiated the payment down to $2,300 and the case was closed, court records show.

In addition to multiple civil actions, Petetit has been charged with five misdemeanors since co-founding PB Companies, two over money issues.

In 2014, Petetit was arrested for and charged with two misdemeanor counts for writing bad checks. The charges were dismissed after Petetit agreed to enter the San Luis Obispo County bad check program, according to court records.

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Welcome to the world of Real Estate Development. The risks are astronomical. Even the best conceived projects face nearly insurmountable roadblocks. Look at the Costco/Home Depot Center in San Luis Obispo. Even once completed and ready to open law suits tied it up for over a year delaying the opening. The developers seem to always be short money and push to pay everything out until the project is completed. This is usually because the projects are short on funding and the developer has also used all of their resources. I noted in posts to previous articles that those investing in these projects know exactly what they are getting into as the majority are serial investors. The rewards can be very high, but, the risks are as well.


A fool and his money are soon parted.


… and parted, and parted, and parted again, until the fool has absolutely nothing left to be parted from.

And at that point, the fool’s phone stops ringing.


wow, reading this article and everyone’s comments, I see nothing. Absolutely nothing here.

They have 300m in investments and you’re able to point to one contractor who was allegedly owed $3,000 and not even related to one of the development projects?

Are you serious with that? How is that even relevant?

You say several sub-contractors are owed money, but you don’t name them or how much they are owed or how they are not 100% protected by mechanics liens? Why would you make such hazy innuendos if you don’t really know any facts?

The principals told investors they might earn up to 20-50% once the project is complete and sold off? And? What’s wrong with that? It’s not 20-50% per year compounded, it’s 20-50% return over a few years after the project is completed and sold off. That’s what it has always been for investors of development projects and that’s what it should be. Nothing wrong with taking a portion of your portfolio and putting it in CA real estate development–in fact that’s what a good portfolio manager does. It’s called diversification. Do you even have a clue that CA real estate almost always goes up in value and that investing in developing land in CA is one of the historically best ways to get rich?

What I’m always amazed about is how an author, with probably no business experience or investing experience or development experience can throw out a bunch of weak knee-ed negative innuendos with no actual facts of wrong doing or losses to investors and the naysayer readers take it and run with it.

Haters love to hate. And naysayers love to naysay.

Mr. Holly

With your endorsement, do you have anything invested with this group? Nothing completed, lawsuits, unpaid bills and exaggerated returns. I know which way I would go with anything like this but I wish you the best of luck with your investments here.


Oh, and don’t forget Petetit’s arrest….Yeah. nothing to see here….


Nothing completed


Name them?



Name them?

unpaid bills


Name them?

exaggerated returns


Name them?

If you can’t name them, then admit you have no idea what you’re talking about.

Mr. Holly

Go the fish wrap (Tribune) on July 14the and read all about it. If the Trib reported it there must be one helluva story behind it to wake them up.


So you’re running with their own project valuations of $300M and calling that “investments”?

And yes, this community gets to be cynical, God knows we’ve seen this movie before. I’ve been involved in this sector for 20 years. I see it coming a mile away. I’ve dealt with the Mt. Rushmore of con men who’ve left the so many people screwed over. I hope they can pull something out of their ass to make this happen… but cynicism and investigation should be the rule. Question: What have they actually seen through as a company? They’ve got a “pitch”… that’s what they’re selling. Keep spreading sunshine Karen.


time will tell.


These guys are all-star douchebags. Can’t believe people go for this pennies from heaven con every time. Can’t feel sorry for investors seeking that kind of return from such amateurs.


If you are promised a high rate of return, RUN away with your money. No investments are guaranteed. How much do you want to get that there are people who got taken by gearharts, Guthrie, yaguda, Forrest, Ethan al that are in this scam as well.

Greed cuts both ways.


And stupid is as stupid does.


Sadly, this is fairly typical in the developer world. Rule 1) always use someone else’s money, Rule 2) never pay any or all of the bills.

Larger developers, with actual projects under their belts, often will go a year or more with outstanding bills due – in essence, forcing Architects and Engineers, or even Construction Companies to float them. If the developer brings in a lot of projects, no one complains too loudly and interest percentages are ignored and/or waived.

All in all, nothing in this story (apart from the 20%-50% returns) smells unusual. The problem is that Real Estate almost always sells for so much more than the construction costs, but one needs to pay those costs before the sale of the property, so it’s a juggling game – remember Rule 1 & 2.


Sadly, this is fairly typical in the developer world. Rule 1) always use someone else’s money,


As if what developers are supposed come up with millions out of their own bank account to build a development? Did you put up cash to buy your house? Did you even put up all cash to buy your car? Do you ever use a credit card? Yes, developers use other people’s money, in the same way that home owners use other people’s money to buy a house. It is the way it is done in America. It’s absurd to suggest that this isn’t common knowledge.

Rule 2) never pay any or all of the bills.


Outright lie. Every singled contractor gets what’s called a mechanic’s lien on all work and improvements they do on a property. No developer can get his next release of money until all contractors have been paid in full.

Reality check.


A mechanic’s lien doesn’t guarantee that a contractor gets paid. All it seems to guarantee is a lawsuit to foreclose on a lien if payment is not made.


People should always be leery if some offers you a 10% return on your money at a time when the banks only offer 0.5%.


Pop goes the weasels . It is our duty as SLO citizens to pass this article along to all local contractors and laborers. These 2 crooks have a long history of screwing people. Lets learn from past similar experiences and protect our neighbors.


I laughed (sadly) when they started throwing out numbers of, it is this value but will be that value etc. bull shite.

Anyone remember Kelly at the Links comment about how what (on paper) was 4 million in value was going to be 11 million in value but in reality it was the 4 million? It ASTOUNDS me that we are BARELY removed from the Gearhart debacle and people are already lining up again?

Not to stereotype all developers but after watching Block and Bower in the 80’s, Gearhart and others in the 2000’s and now possibly this? Makes one want to RUN when they hear the word developer. Maybe it is time they be makers and not TAKERS!!