Texas’ Biggest Loans Headed to Foreclosure in February

2 February 2026

The round of foreclosure notices that went out last month included bad news for Dallas’ beleaguered urban core.

Starwood foreclosed on The National, Todd Interests’ mammoth mixed-use conversion project and one of the largest urban restoration projects in the country. Shawn Todd’s firm spent $460 million carving the project out of the long-vacant former First National Bank Tower.

Todd Interests still owes about $230 million on the $245 million loan from Starwood, Todd told the Dallas Morning News.

The news comes at a difficult time for Downtown Dallas, which is still reeling from AT&T’s announcement of plans to move its headquarters from downtown to Plano. The foreclosure also follows Todd Interests’ sale of its stake in the nearby East Quarter to J.P. Morgan Asset Management.

The Starwood loan makes up more than a quarter of the value of troubled loans in the Texas Triangle headed to auction this month. The sum totals $805 million, making February the third month in a row where the value of troubled CRE loans tops $800 million in Texas.

Here are the biggest loans up for auction. It’s possible that some of these borrowers and lenders will reach agreements to avoid auction.

Houston

This month’s largest new loan flagged for auction in Harris County is a nearly 150-acre swath of partially developed land zoned for industrial development. The property at 2012 Miller Cut Off Road in La Porte is the site of an old power plant. An entity tied to industrial developer Genover provided a $30 million loan for the property in 2022. The owner is St. Petersburg, Florida-based Trak Commercial. Loan documents dated Thursday show the owner secured new financing for the property, a $38.8 million loan from JGB Capital.

Austin

It’s been less than a year since Austin-based One Development secured a $14 million loan for townhome project Rosemark Woodland, and it’s already being accused of default. The 27-unit Austin condo community, at 2209 Woodland Avenue, opened last year. Arixa provided the loan, which works out to just under $519,000 per condo.

San Antonio

The fallout from the passage of House Bill 21 continues with the foreclosure of Acadia on the Lake Apartments, at 4031 Thousand Oaks Drive in San Antonio. David Shippy’s Quantum Leap Property Management allegedly defaulted on a $31.3 million loan provided by CBRE in 2025 for the 304-unit property built in 1982. Quantum Leap faced foreclosure on another San Antonio apartment complex for the same reason just last month.

Quantum Leap partnered with Edcouch Community Housing Finance Corporation to get property tax breaks on Acadia on the Lake Apartments, using a loophole known as a “traveling” housing finance corporation. Quantum Leap sold the property to Edcouch, an affordable housing organization 250 miles from San Antonio, and leased the ground. Gov. Greg Abbott signed a bill closing the loophole, which became a popular cost-cutting tool for multifamily syndicators and investors. Some appraisal districts have interpreted the new law as justification to remove tax credits for loophole users, even though the law gives operators a few years to come into compliance.

Dallas

As detailed above, the biggest troubled loan in Dallas this cycle is the one tied to The National. In addition to the financing from Starwood, the redevelopment project was buoyed by about $100 million in historic credits and $50 million in city tax increment financing. The project transformed the long-vacant skyscraper into a blend of apartments, hotel rooms, offices and retail.

Fort Worth

Vertical Street Ventures is facing foreclosure on The Sherry, a 252-unit apartment complex at 2208 East Park Row Drive in Arlington. ReadyCap provided the $24.4 million mortgage for the property in 2021. The debt on the property built in 1968 works out to $97,000 per unit.

Repeat offenders

Of the properties scheduled for auction, nine have been flagged for foreclosure multiple times, sometimes reflecting a loan modification or ongoing litigation. Here are the properties that have been on the block before:

Latitude 2976, a 734-unit apartment complex at 201 and 301 Wilcrest Drive in Houston ($77.2 million loan);
Veranda Village, a 330-unit apartment complex at 3536 Shaver Street in Pasadena ($47.2 million loan);
The Co-Op at the Med Center, a 199-unit apartment complex at 7710 Main Street in Houston ($25 million loan);
San Antonio Marriott Northwest Medical Center, at 3323 Northwest Loop 410 in San Antonio ($18.5 million loan)

Wyndham Garden Austin, at 3401 South Interstate 35 ($13.4 million loan);
A 270,000-square-foot office building at 10777 Clay Road in Houston ($10.5 million loan);

A retail building at 6610 Low Bid Lane home to Soccer Central in San Antonio ($10.5 million loan);
Mar Del Sol Apartments, a 248-unit building at 9303 Woodfair Drive in Houston ($10 million loan); and
La Bella Vista Apartments, a 152-unit complex at 3600 South Shaver Street in Houston ($9.2 million loan).