RREAF Holdings has acquired 2828 at Royal Oaks, a 510-unit garden-style apartment complex in Houston’s Westchase area. The Dallas-based firm bought the property after its previous owner lost it to foreclosure, according to deed records.
The property came under the control of AB CarVal Investors from Minneapolis in August through a $20 million credit bid. This followed an alleged loan default by Colony Hills Capital, based in Wilbraham, Massachusetts, on a $65.2 million loan tied to the complex. RREAF partnered with Axonic Capital for this purchase from AB CarVal Investors; financial details were not disclosed.
Colony Hills Capital originally acquired the complex in 2021 during a period when multifamily investors were active in Texas, buying older apartment buildings with plans to renovate and raise rents. However, rising interest rates undermined these strategies and led to increased foreclosures starting in 2024.
To manage costs, Colony Hills Capital used a partnership with Maverick County Housing Finance Corporation (HFC) to obtain property tax breaks via what is known as a “traveling” housing finance corporation arrangement. This involved selling the property to Maverick County HFC—an affordable housing group located about 330 miles from Houston—and then leasing back the land.
During the 2025 legislative session, Governor Greg Abbott signed legislation closing this loophole, which had become popular among multifamily investors seeking tax savings. Some municipalities responded by revoking property tax credits for deals structured under this system, although operators were given time to comply with the new law.
The removal of these tax credits has contributed further distress within Texas’ multifamily real estate sector. In Houston specifically, most commercial real estate loans that reached foreclosure auctions over the past year have been tied to multifamily projects. In January alone, troubled Houston multifamily loans accounted for $198 million out of $826 million in distressed properties headed for auction across Texas’ major urban centers (the “Texas Triangle”), according to Roddy’s Foreclosure Listing Service (https://www.roddysforeclosurelist.com/).
With this acquisition, RREAF continues expanding its presence in Houston’s multifamily market. The company plans to rebrand the property as Aura Westchase and renovate 37 percent of its units within the year. Upgrades will also include new signage and amenities enhancements.
This purchase brings RREAF’s total Houston-area portfolio to around 2,000 units and marks its third distressed multifamily acquisition in 2025—and its first deal with Axonic Capital.
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