Officers searched a derelict property in the semi-rural suburb of Dural on Sydney's north-west outskirts on Thursday night after identifying it as a makeshift stronghold for the kidnappers.
But there was no sign of the hostage, and police on Friday admitted things didn't look good for his safe recovery.
"It's been seven days now, so hope is fading," Detective Acting Superintendent Andrew Marks said.
"We have grave concerns for his safety, but we won't give up trying to find him."
The mysterious case has stumped police who, in the absence of a ransom demand, have used media to directly appeal to the kidnappers to return the grandfather to a safe location.
They were also unclear how long the grandfather spent at the Dural property, described by police as derelict, vacant and out of view from the street.
Police believe the property was seen in videos that emerged of the grandfather being restrained.
Evidence suggesting Mr Baghsarian had been at the property in the past seven days was seized, and police have established a crime scene.
Several police were seen at the ageing red-brick home, which is set over two levels and sits on a two-hectare tree-lined property.
About 10 officers entered a rural property, homing in on an area a few metres in diameter and bisected by powerlines.
Pilates studio owner Amanda Burke, who lives a few doors down, described the kidnapping as distressing.
"We can't believe it's up the road. It's a quiet neighbourhood," she told AAP metres away from investigators.
The 50-year-old mother regularly takes clients for power walks down the street as horses mill about the semi-rural properties.
"Here we are, worried about the horses neighing when there's a poor kidnapped guy down the street," she said.
Mr Baghsarian's family spoke publicly for the first time earlier this week, describing the February 13 kidnapping as a surreal and harrowing ordeal.
"Our family is living through a nightmare we never thought possible," they said in a brief statement released via police.
Mr Baghsarian's lack of personal links to any criminal or underworld activity is making the case difficult for investigators and his family, according to Det Act Supt Marks.
"This is not the world that they live in, it's taken them by shock," he said.
"They're anxious, they're devastated, and they want some answers, and that's what we're here today to try and (do)."
Police are continuing to appeal for public assistance to help identify and arrest those responsible for his kidnapping.
Ms Burke said the kidnapping and other recent incidents nearby had left some locals on edge.
She pointed to the deserted caravan where police found explosive material and notes referencing Jewish sites, alleged to be targeted by criminals in a con job in January 2025.
"For the sake of the family, we hope they can find him. It doesn't make sense," she said.
Police have asked locals who saw anyone suspicious at the abandoned property, or in Dural more generally, to come forward.
"Even if (you think) it is the most insignificant information, let us be the judge of that," Det Act Supt Marks said.
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