RREAF Holdings has acquired a 510-unit apartment complex in Houston, marking another example of investors capitalizing on the city’s ongoing multifamily property distress. The Dallas-based firm purchased 2828 at Royal Oaks, located at 2828 Hayes Road in Westchase, after its previous owner lost the property to foreclosure.
According to deed records, AB CarVal Investors from Minneapolis assumed control of the property in August through a $20 million credit bid following an alleged loan default by Colony Hills Capital. Colony Hills Capital, based in Wilbraham, Massachusetts, had previously bought the complex in 2021 during a surge of investment activity targeting older Texas apartment buildings. The plan was to renovate these properties and increase rents before selling them for profit. However, rising interest rates disrupted these strategies and led to a wave of foreclosures beginning in 2024.
RREAF partnered with Axonic Capital for this acquisition from AB CarVal Investors; financial terms were not disclosed.
The transaction also involved Maverick County Housing Finance Corporation (HFC), which had partnered with Colony Hills Capital to secure property tax breaks using what is known as a “traveling” housing finance corporation. This arrangement allowed the former owner to sell the property to Maverick County HFC—an affordable housing group based far from Houston—and lease back the land.
During the 2025 legislative session, Governor Greg Abbott signed legislation that closed this loophole for tax savings. Some municipalities responded by revoking property tax credits associated with such deals, though operators have been given time to comply with the new law. The loss of these tax credits has added pressure on Texas multifamily owners already facing financial challenges.
Houston has seen significant impacts from these developments: over the past year, most commercial real estate loans sent to foreclosure auctions across Texas have been tied to Houston multifamily projects. In January alone, troubled loans connected to Houston apartments accounted for $198 million out of $826 million headed for auction throughout the Texas Triangle region.
RREAF plans to rebrand the newly acquired complex as Aura Westchase and intends to renovate about 37 percent of its units this year. Upgrades will include new signage and improved amenities.
This purchase expands RREAF’s Houston-area portfolio to roughly 2,000 units and represents its third distressed multifamily acquisition in 2025—the first one completed alongside Axonic Capital.
