HOUSTON – A troubled West Houston apartment complex is drawing renewed scrutiny from city leaders and residents, who say living conditions at the property are unsafe and worse, that the out-of-town owners aren’t being held accountable.
The Lakeside Forest Apartments, located off Wilcrest, are facing dozens of city code violations, ranging from stagnant green pool water to sewage spills and broken infrastructure.
“This place looks uninhabitable. It’s no place I’d ever want a family member to live,” said Meegan Dunlap with the Lakeside Improvement Association Board.
During a recent visit to the property, KPRC 2’s Rilwan Balogun was asked to leave by security after requesting to speak with onsite management. Repeated attempts to reach ownership have been unsuccessful.
The property is owned by the Texas Essential Housing Public Facility Corporation, based in Boerne, Texas, more than 200 miles away. Despite its condition, the complex receives a property tax exemption in exchange for providing a portion of its units as affordable housing.
Houston Council Member Mary Nan Huffman, who represents the area, says the property is draining city resources without contributing to the tax base.
“They’re taking resources from police, fire, EMS, and these are Houston residents, right? But they’re not giving back to the property tax aspect of it,” Huffman said. “Now, because it’s such an issue, I’ve had to use my council district service funds to pay HPD overtime to go out and monitor this property because the crime has been so bad.”
HPD confirms there have been more than 140 service calls to the complex since January 4th, 2025. Huffman says she’s now using her Council District Service Funds to pay HPD officers’ overtime to patrol the area, citing a rise in crime and safety concerns.
“You walk around, and you see graffiti, broken glass, sewage on the ground,” Huffman said. “No human being should have to live like this.”
The state is supposed to audit properties like this annually. KPRC 2 has reached out to the Texas Department of Housing and Community Affairs to find out when they last inspected the complex, and whether another visit is scheduled.
A spokesperson for the Texas Department of Housing and Community Affairs shared with KPRC 2 they do not audit PFCs instead the hire a third-party contractor.
“TDHCA does not monitor or inspect properties that are not in our portfolio. A property developer must use one of TDHCA’s financing programs (federal Housing Tax Credit Programs, Multifamily Direct Loan, etc.) for it to fall under our oversight, the spokesperson said. ”Lakeside Forest Apartments is not a TDHCA-monitored property. HB 21 does not require on-site inspections, in-person interviews, or physical presence.”
Meanwhile, a new state law signed by Governor Greg Abbott aims to prevent out-of-town corporations from receiving these types of tax exemptions unless they’re based in Texas. However, the law is not retroactive, meaning existing exemptions like the one for Lakeside Forest remain in place.
“This was all legal under the statute,” Huffman said. “But it’s taken property off our tax rolls, and now we’re left dealing with the consequences.”
Despite ongoing efforts, KPRC 2 has not received a response from the owners of Lakeside Forest Apartments.
Texas Department of Housing and Community Affairs statement:
To begin, TDHCA does not perform the audits for properties owned by a PFC. House Bill 21, passed during the 88th Legislative Session, requires PFCs to perform an audit of their properties using a third-party vendor and submit those reports to TDHCA each year. The first audit report is due the year following the first anniversary of the date of the PFC acquisition for an occupied development. For your reference:
Pursuant to Section 303.0426(b) of the Texas Local Government Code:
(b) A public facility user of a multifamily residential development claiming an exemption under Section 303.042(c) and to which Section 303.0421 applies must annually submit to the department and the chief appraiser of the appraisal district in which the development is located an audit report for a compliance audit, prepared at the expense of the public facility user and conducted by an independent auditor or compliance expert with an established history of providing similar audits on housing compliance matters
Some examples of what TDHCA reviews and PFCs must report in the audit include:
- At least twenty-five percent (25%) of the units in the Development are reserved for, or occupied by, households at or below sixty percent (60%) AMI
- At least an additional forty percent (40%) of the units in the Development are reserved for, or occupied by, households at or below eighty percent (80%) AMI
- The Development meets the household income restrictions set forth in §10.1104(B)
- Monthly rent for Restricted Units may not exceed thirty percent (30%) of the imputed household income limitation for the unit, adjusted for an imputed family size of one person per bedroom plus one person, as determined by HUD.
- The percentage of Restricted Units in each Unit Type in the Development, must be the same or greater percentage as the percentage of each Unit Type of units that are not Restricted Units in the Development
- Occupants of Restricted Units are required to recertify income at the time of the renewal of a lease agreement
- Must calculate the annual savings to households living in Restricted Units (when compared to the annual rental income that would have been collected on those Restricted Units if they were charged market rate.
This list is not comprehensive, but I wanted to present that the requirements focus on costs of rent/income-restricted units, and that the PFC-owned property is providing the required number of affordable units.
Next, TDHCA does not monitor or inspect properties that are not in our portfolio. A property developer must use one of TDHCA’s financing programs (federal Housing Tax Credit Programs, Multifamily Direct Loan, etc.) for it to fall under our oversight. Lakeside Forest Apartments is not a TDHCA-monitored property. HB 21 does not require on-site inspections, in-person interviews, or physical presence.
Lastly, the Texas Essential Housing PFC did submit a partial audit report to TDHCA. Staff are reviewing the report, and upon completion of the review will send a noncompliance letter for not submitting the full report and for any additional noncompliant items missing from the submission. The PFC gets a 60-day Corrective Action Period, after which TDHCA will review again and if there is anything not corrected, staff will refer the PFC to the Appraisal District with a recommendation of loss of tax exemption.
I believe this information provides adequate reason for a correction as your news story clearly implies TDHCA has some responsibility in the living conditions described in your story, and the Department does not. Please feel free to reach out to me via email or the number I left on your voicemail last Friday when I returned your call.
