Houston's Housing

According to the newspaper account, VMS had filed for a Chapter 11 bankruptcy in 1991 to avoid foreclosure on two Wilshire Boulevard office buildings. The paper quoted a tenant of one building as complaining that "everything has become second-rate."

But, according to sources both here and in Los Angeles, Guglielmo's dealings are rarely that public. Indeed, for a wealthy real-estate investor, he is surprisingly inconspicuous as an owner of record. He is registered as a principal in few business entities, according to California corporate records, and those firms don't turn up as owners of much property.

Sources say Guglielmo has a reputation for "tying up" properties through a web of partnerships by buying them and then trying to sell them quickly for a profit. One Houston source says that Guglielmo, prior to buying the four apartment complexes from the city, owned a dozen properties in Houston, some of which he acquired from the RTC. The source said he learned that Guglielmo had traveled as far as Hong Kong in an attempt to sell them.

"He was considered something of a flake by the local real-estate types," the source says.

Uzick shrugs off such reports about Guglielmo, saying he was convinced the buyer would prove a reputable owner. One reason Uzick cites was Guglielmo's willingness to engage a local management company to oversee operations at Willow Creek, Southwest Village and the two Bellfort Southwest complexes. Uzick says he sent the buyer a list of choices. Guglielmo settled on Insignia Management Group -- a firm Duddlesten Management Group merged with last year.

One complex owned by Guglielmo that could use an attentive owner is Willow Creek. The complex was built in 1971 and, over the last decade, has fallen into disrepair. The sheer size of the place -- 1,682 units -- and the magnitude of the rehabilitation needed suggest it has a ways to go before it becomes a moneymaker. And that's assuming the complex, which has a 95 percent occupancy rate and is located in an area of the city that hasn't received much attention, can remain viable until then.

An analysis of the property prepared before the city bought Willow Creek revealed a couple of environmental concerns, including the presence of asbestos in the drywall. Also, leaking underground tanks stored at a Coca Cola bottling plant next door was said to possibly pose a risk of contamination, though there was no mention of what substance might be leeching into the ground beneath the complex.

There is also concern that the number of units restricted to low-income renters -- more than 1,400 of the 1,682 -- may create problems. Such high concentrations of poor have been discouraged by HUD over the years in favor of "mixed-income" properties, which have a better chance of avoiding the recurring problems of drugs and crime that plague areas exclusively populated by poorer residents.

Still, says one housing advocate, Willow Creek, "can be a benefit to the community. If the private investor manages it well, keeps it safe decent, sanitary. You know, if everything is ideal. But the chances of that happening are pretty slim."

A few years ago, no one would have given the Oak Lake Apartments much of a chance, either. The 452-unit complex off Kuykendahl and FM 1960 in Harris County had degenerated into the kind of place that even pizza delivery drivers wouldn't enter after dark. Residents in a nearby neighborhood called the complex "Coke Lake." The police referred to it as the "War Zone."

But that was before last September, when Houston Interfaith Housing, a nonprofit group with 23 years of experience with low-income housing, bought the faded gray complex from the RTC. The organization put up the purchase price, about $1.8 million, and now manages the complex. Local churches joined together with area civic groups to form the nonprofit Bridges Community Friends to run support services for the low-income residents.

The alliance of Houston Interfaith and Bridges Community Friends lobbied the state government in Austin to win more than $5 million in low-income housing tax credits over the next ten years, which, coupled with $1 million in federal funds, will be used to rehabilitate the complex. Though that rehabilitation is not yet in full swing, there are already signs of good things to come at Oak Lake.

A small office set up in a two-bedroom unit in the center of the complex serves as the nerve center for Bridges Community Friends. Two small children hop up and down on plastic chairs as a middle-aged woman reads them a story. The book is from a library assembled in one of the unit's rear bedrooms. Notices seem to hang everywhere -- the windows, doors, two bulletin boards -- announcing upcoming Girl Scout and Boy Scout meetings, tutoring sessions, English lessons, a job service. Just outside the door, two young women prepare picnic tables for the summer lunch program that feeds 82 children from the complex.