Leon Valley sues apartment complex for ‘unsafe’ conditions

Earlier this month, at the Vista Del Rey apartment complex in Leon Valley, a stream of sewage and clumps of used toilet paper rolled down the sidewalk between buildings, spreading a foul smell to the area.

Code inspectors from the Municipality of Leon Valley have for years used the revolving door of property owners to perform repairs to units and clean up the complex, where code violations have persisted over time. But every time the property sells — as it has twice in the past three years — that pile of quotes disappears, forcing compliance officers to start over.

Earlier this month, Leon Valley city officials voted to try a different tactic.

The city is suing the owners of the sprawling apartment complex to force repairs to the property. The lawsuit will remain attached to the property, officials said, even if it is sold. Its current owner, Shippy Properties, is trying to sell the struggling resort.

“The Vista Del Rey apartments are plagued by crime, deplorable living conditions, and numerous violations of city code, which pose a threat to human health and safety,” the lawsuit, filed on 5 August in Bexar County District Court, alongside a request for a temporary restraining order.

Sewage flows between apartment buildings at the Vista Del Rey complex in Leon Valley on August 6. Credit: Kaylee Greenlee Beal for the San Antonio report

The lawsuit continues: “The City has sought to resolve these issues for years by working with at least three different groups of landlords, without success. These unsanitary, unsafe and illegal conditions not only still exist, but continue to worsen as the property ages and necessary repairs are not made.

The lawsuit asks the court to order the owners to pay up to $1,000 a day, with the property remaining in violation of city code.

In a prepared statement sent to the San Antonio report, Shippy Properties said it “invested more than $1.5 million in renovations to the property, which has significantly improved living conditions for our residents.” The statement goes on to say that the company “will continue to work with the city with the ultimate goal of providing a safe and enjoyable living experience for our residents.”

From the first week of August, none of the 54 apartments in the complex the buildings were up to code, said Crystal Caldera, city manager of Leon Valley. The 453-unit complex, the largest in the city, hasn’t had a valid occupancy certificate for years.

The violations alleged in the lawsuit include, among other things, failing to ensure each unit has hot water, unsafe stairs, littering the property, and failing to obtain a valid certificate of occupancy. Most of the repairs needed are focused on the exterior, Caldera said, because permit inspectors haven’t had a chance to examine the interiors yet.

On August 6, Leon Valley Councilman Jed Hefner spoke with several tenants of their units. Among them was Abigail Ceniceroz , who said he struggled to convince management to tackle mold in his unit. The dishwasher stinks of standing water dripping from the sink and water leaking from holes in his bathroom ceiling. She worries about her son, who she says is terminally ill and on dialysis.

Hefner asked her where she would go if the building was declared unsafe. “I don’t know,” she said. “My son needs a place to live.”

Abigail Cenicroz's son is terminally ill and his condition is aggravated by mold growing in their apartment following unresolved water damage at the Vista Del Rey apartment complex in Leon Valley.
Abigail Ceniceroz’s son is terminally ill and she said his condition worsened due to mold growing in their apartment following unresolved water damage in the Vista Del apartment complex. Rey in Leon Valley. Credit: Kaylee Greenlee Beal for the San Antonio report

They plan to move to Austin in six months with Ceniceroz’s partner, but until then she says their options are limited because they are on fixed incomes.

Shippy Properties grew fastest in the San Antonio area in 2021, according to real estate data from CoStar.

Its purchase of the Vista Del Rey complex in April last year grew its apartment portfolio to more than $1 billion, its website said, noting that the complex had been recently renovated with “modern finishes , wood-inspired floors, generous storage areas, fully equipped kitchens with black appliances, new cabinet hardware and gooseneck faucets, creating the perfect space for residents to relax [sic] and entertain.

Any citations or court costs related to Vista Del Rey that Shippy Properties pays will not be drawn from the remainder of its $1 billion portfolio. The complex, like most rental properties purchased today, is owned by its own individual limited liability company – a form of business that closes Financial responsibility.

A San Antonio Report article about the complex in January revealed that the property’s owner, David Shippy, had written a book describing the apartments he owns as “cash machines” and its working-class tenants as a “captive audience”.

Shippy did not respond to an email seeking comment on Thursday.

In May, the resort’s tenants organized and submitted a petition to property management demanding repairs, as well as better communication and transparency. The petition described frequent and prolonged water outages, a lack of hot water, broken air conditioning equipment, and inadequate security measures that could control violent crime at the resort.

Caldera said the persistent and vocal presence of tenants at Leon Valley City Council meetings has motivated the city to focus its resources on the Vista Del Rey complex, even though it also faces compliance issues in other areas. properties.

A similar situation is playing out in northwest San Antonio at the Seven Oaks apartment complex, where tenants have organized to speak out against conditions, prompting officials to act. In that case, some members of the San Antonio City Council are currently discussing code enforcement reforms for the city.

Code enforcement challenges

Across the San Antonio area, rising rents and a growing number of tenants have turned apartments, especially older apartments, into a sought-after commodity for investors. About 1 in 7 apartments changed ownership last year, as the pace of transactions accelerated.

Leon Valley City Council member Jed Hefner takes a photo of a hole in the ceiling of Abigail Cenicroz's Vista Del Rey apartment on August 6.
Leon Valley City Council member Jed Hefner takes a picture of a hole in the ceiling of Abigail Ceniceroz’s Vista Del Rey apartment on August 6. Credit: Kaylee Greenlee Beal for the San Antonio report

Leon Valley’s escalation against code violations in Vista Del Rey highlights a challenge cities face in enforcing ordinances when apartments change hands so frequently.

According to the lawsuit, conditions at the Vista Del Rey complex have deteriorated since 2017, when local police began receiving an influx of calls reporting violent crimes. As of 2020, code enforcers have seen an increase in calls reporting water leaks from electrical appliances, aggressive dogs, and unsafe stairs. In April 2022 alone, code enforcers investigated 20 complaints about units that lacked access to hot water.

The citations resulting from these appeals seem to be a headache for the owners of the complex. A recent resort lease, shared with the San Antonio report, includes new language in all capitals: “DO NOT CALL CODE ENFORCEMENT FOR REGULAR OR EMERGENCY WORK ORDERS.”

Even though code citations and police reports have increased over the past five years, the property has sold twice in the same period for higher prices, according to Yardi Matrix data. The property sold in 2019 for $38.33 million and again in 2021 for $46.2 million, when Shippy Properties bought it from another Austin-based company named GVA.

Each time a property sells, all enforcement action attached to it is effectively erased, Leon Valley officials said, and any progress made in bringing a property into compliance starts over. Adding to the confusion, the recent turnover of property management staff means the quotes are now lost in the chaos.

Then, when the property is sold to a new owner, the city often doesn’t find out until much later, Leon Valley Fire Department Chief Michael Naughton said. His department will sometimes be notified of a sale when he performs new fire inspections. “I can’t tell you a mechanism in place that tells me that a building – or this apartment complex or this mall – has been sold, other than that it’s renamed and given new work by paint.”

The Municipality of Leon Valley covers 3½ square miles and its total budget for the last fiscal year was just over $12 million. The Vista Del Rey apartments are his second-largest source of property tax revenue, according to Bexar County tax records.

Shippy Properties is trying to resell the complex, said city officials, an investor and a former leasing agent.

A number of potential buyers are said to have visited the property, including at least one in July when the group received a personal visit from David Shippy.

A local property investor, speaking on condition of anonymity, said Shippy Properties originally asked for $55-60 million, but over the past few months that price has come down, but not below the price initially paid by the company.

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