A number of large commercial real estate (CRE) loans in Texas are scheduled for auction this February, following a new round of foreclosure notices that affected several high-profile properties across the state.
In Dallas, Starwood foreclosed on The National, a major mixed-use redevelopment project led by Todd Interests. The project involved a $460 million investment to renovate the former First National Bank Tower. According to Shawn Todd of Todd Interests, there is still about $230 million owed on the original $245 million loan from Starwood. “Todd Interests still owes about $230 million on the $245 million loan from Starwood,” Todd told the Dallas Morning News.
This foreclosure comes as Downtown Dallas faces challenges, including AT&T’s recent decision to relocate its headquarters from downtown to Plano. It also follows Todd Interests’ sale of its stake in East Quarter to J.P. Morgan Asset Management.
The value of troubled CRE loans going to auction in the Texas Triangle totals approximately $805 million this month. This marks the third consecutive month where distressed loan values have exceeded $800 million in Texas.
Among other notable properties headed for auction:
– In Houston, a nearly 150-acre property at 2012 Miller Cut Off Road in La Porte is up for auction after receiving a $30 million loan from Genover in 2022. The owner, Trak Commercial, recently secured new financing with a $38.8 million loan from JGB Capital.
– In Austin, One Development’s Rosemark Woodland condo community at 2209 Woodland Avenue is facing default less than a year after securing a $14 million loan from Arixa.
– San Antonio’s Acadia on the Lake Apartments at 4031 Thousand Oaks Drive faces foreclosure due to an alleged default on a $31.3 million CBRE loan provided in 2025. Quantum Leap Property Management partnered with Edcouch Community Housing Finance Corporation for property tax breaks using what is known as a “traveling” housing finance corporation loophole. Recent legislation signed by Governor Greg Abbott closed this loophole and some appraisal districts have started removing tax credits for those who used it.
– In Fort Worth, Vertical Street Ventures may lose The Sherry apartment complex at 2208 East Park Row Drive after ReadyCap issued a $24.4 million mortgage for the property.
Several properties have been flagged multiple times for foreclosure or are involved in ongoing litigation or loan modifications. These include Latitude 2976 and Mar Del Sol Apartments in Houston; Veranda Village and La Bella Vista Apartments; The Co-Op at the Med Center; Wyndham Garden Austin; an office building at 10777 Clay Road; Soccer Central’s retail building at Low Bid Lane in San Antonio; and San Antonio Marriott Northwest Medical Center.
Industry reports indicate that troubled CRE debt has continued to surge over recent months:
– In January, distressed debt reached more than $826 million statewide (https://therealdeal.com/texas/2026/01/03/new-year-same-distress-troubled-debt-tops-826m-for-january-auction).
– December saw troubled CRE debt exceed $900 million ahead of foreclosure sales (https://therealdeal.com/texas/2025/12/04/troubled-cre-debt-surges-past-900m-for-decembers-foreclosure-sale).
The outcome for many of these properties remains uncertain as borrowers and lenders may still negotiate agreements before auctions take place.
