Third Montrose Skylane Apartment Building Turns Over

The proud new owner of the scuzzy former Skylane Apartments on the corner of Richmond and Hazard St. is the same real-estate agent who snapped up and renovated the 2 smaller Montrose Skylane Apartments (on West Alabama) last fall — local apartment collector Cody Lutsch. Those of you keeping score at home (or using the stats to play your own round of Fantasy Montrose Landlord) will note that the addition of the 44 apartments on the half-acre site at 1901 Richmond jettisons Lutsch into the Number 5 Montrose Property Owner position — by number of units. Lutsch expects that status to be short-lived, though — as long as the expected sale of some of his other neighborhood properties goes through.


Lutsch closed on the Skylane — more recently (and colorfully) labeled the Houston Medical Apartments — last week, after much encouragement from the previous owner’s bank. Under the sale agreement, though, he’d already begun taking over management of the property: clearing out units that had been used as storage, fixing up and advertising units, and “kick[ing] out a few known bad apples.” Lutsch met with the Richwood Place Civic Association before the closing; members of that organization had been claiming that the neighborhood’s problems with crime and illegal activity stemmed from that apartment complex. “The place needs some love, that’s for sure,” Lutsch tells Swamplot. He says he plans to fix the place up and operate it “for at least the next few years.”

Photos: Cody Lutsch

40 Comment

  • Way to go Cody, best of luck to you.

  • Yeah, kudos to Cody!
    I hope that cleaning that up is going to be way profitable for you, because it is certainly great for the rest of us in the ‘hood.

  • 44 units on .5 acres is excellent coverage. This guy must be a saint to spend one dime on this complex…I wouldn’t. Well, I’d spend $100 on a banner campaign to say “free first month’s rent for as-is rental.”

  • The state sex offender registry website currently lists five people in that not-so-large complex, which I think is actually down from what it used to be.

  • Bless you Cody!!!

    –your new neighbor.

  • Really great to see Cody taking on these projects. Hope him the best of luck and profit.

  • That place has been action packed over the years… good luck Cody.

  • Cody, I know you’re on here regularly, and I will extend my invitation once again: If you buy the Heights Skylane and clean it up, I’m buying the beer kegs to welcome you to the neighborhood.

  • Thanks for the kind words. I’m looking forward to the project. We’ve fixed about 10 of the ‘down’ units, and have been upgrading them and leasing them quickly.
    Ironically on a project like this you end up making units nicer and then charging less. The upside to that is a stable tenant base.
    I spent almost every day all day at 219 W. Alabama in the beginning while it was being fixed up. I’m now at 1901 Richmond almost every day. If anyone wants to drop by and say “hi” feel free. I can show you some “before” (scary) units and “after” units. Just pardon our temporary mess as we have a lot of work going on.

  • tanith: e-mail me to discuss. codybiz at gmail.

  • off-topic, but any plans to retain the complex post-light rail or will it be sold and demo’d at that point?

  • Congrats Cody. Keep taking em down.

  • Joel: My (current) plan is to hold after light rail, and have that be a selling point as a rental for tenants vs. as a building acquisition for developers. Though I’d be lying if I said I didn’t take a purchase by a developer into consideration as an option down the road as a factor when buying. The highest and best use of this property may be in its existing form today, but maybe not in 3-5 years.
    Like a lot of older Montrose area properties, the value is in the land. If you can buy something that happens to cash flow on the land, all the better.
    I will fix up 1901 by putting money into capital improvements, and I wlll run the property under the assumption that it’s not going to be knocked down tomorrow. Part of that is because I think that makes the most sense from a business perspective, but also because I happen to be a Montrose resident myself.
    So while I’m running the place as if I was holding for the long run, if a developer comes to me and expresses that they have more interest in the property than I do, I won’t say ‘no’ due to misplaced nobility.

  • My business is across the street from Crackla… I mean Skylane and, having been here for 11 years, I have seen some crazy stuff go down over there. Thanks for taking on this project Cody.

  • Cody- how about buying the Takara-so and cleaning it up? That is a huge source of illegal activity in the neighborhood. Great news regarding Houston Medical. Thanks.

  • Tanith, I’ll come drink that beer with you. I sold my house and moved to the other side of the WH to get away from that thing. Anyhow, count me in on the celebration. I’ll bring chips and queso.

  • Robert: (warning: long reply)
    I own a group of 4 fourplexes across the street from Takara (on W. Main). The problem isn’t in fixing the place(s) up, it’s the city getting in your way. In turning a place around they are not a help. They’re not even a neutral bystander. Normally they’re a giant hindrance.
    I bought the vacant fourplex between my other three on W. Main and have finally decided to give up on it for a few months. It’s the first time I’ve ‘given up’ on a project and it wasn’t due to the place needing gobs of work — it’s that the city can sap all of your energy.
    I bought it because it was vacant and between my others. It was ugly, people would illegally dump, it was boarded up, tons of graffiti, the trees were overgrown, etc. Neighbors didn’t like it. I didn’t like it. So I decided to buy it and make it nice. The *DAY* I bought it and started working on it (gutting it) I got multiple red tag stop work orders. I had to wait weeks and pay literally thousands before I could do anything due to previous dangerous building orders. I finally got all the electrical replaced, but can’t get it cleared and move forward till some other crap gets done. That’s when I decided to lock it up and just deal with it later. Sucks as I had tenants excited to move in, and all leases had to be canceled. Looking back, I wish I wouldn’t have bought it and let the place rot.
    Today I got a fine for trash *IN BAGS* in the BACK YARD (not visible from the street) at the property. This despite the fact that the building is now re-painted, landscaped, graffiti removed, rotten wood and several windows replaced, etc. Basically it looks 100x better than when I bought it. *shrug*
    A few days ago the building next door (another 1940s fourplex) had a rotten window that was falling out so I replaced it — only to get a $300 fine the next morning for replacing a window w/o permit.
    tl;dr: So yeah, util our government gangsters let those of us that are trying to do a good thing do our thing, it’ll be one property at a time for me.

  • Glorious! Welcome to the neighborhood, Cody.

  • Cody, that was just evil of you to think you could replace a window without getting approval from Ma Parker’s gang. After all it isn’t your property, it’s theirs. They own it, you pay rent every year to use it. That’s one reason that we’ve actually had the contractors who have done work for us get the permits first – to avoid the fines for activities that are none of the City of Houston’s business.

    I’m also mightily pissed that I will have to pay an electrician $2000 to rewire my garage, rather than running the wire myself, which I am full capable of doing. Give me the permit and red tag me if I fail inspection. It’s not that darn hard to put new romex up where the old two wire cable used to be.

  • “only to get a $300 fine the next morning for replacing a window w/o permit.”

    really, that is quite messed up.

  • Cody-

    Just out of curiosity, do you consider the apartments at Alabama and Garrott done?

    I will send Gus some photos of what I would consider “not done”.

    Tell me otherwise.

    Better is not good.

  • Von: I’ve only owned the 502 building the better half of a year, and much of that time was spent on serious issues that needed immediate attention at 219.
    The 502 building is much better now (many ‘fixes’ are not visible) but no, it’s not “done”. If you drove by this weekend, you saw my guys were finishing up siding on the W. Alabama side for our inspection tomorrow. The next step is new siding on the Garrott side to go along with new windows.
    There was a lot of work ‘in’ the complex that needed to be done — including a total rewire from aluminium to copper electrical, upgrading several units as people left, and tracking down all sorts of plumbing issues. That takes a lot of man hours and are not ‘wow’ upgrades that are easily noticed.
    I’m curious as to what your concerns are. My e-mail address is listed on an earlier comment.
    I’d like to do more faster, but it’s just me. While I’ve gotten many things accomplished I’ll admit it’s not finished. A lot of people complain from their comfy desk and big house, but aside from swamplot posts and calling 311, they do very little to really improve the neighborhood. If you’d like to help, I’d welcome the assistance.

  • Best of luck, Cody – I think it’s really wonderful what you’re doing for Montrose.

  • Cody,

    Glad to hear you are still working on the 502 building.

    I have done plenty in the ‘hood, from restoring (and putting on the Protected Landmark list) a 1913 house, supporting the controversial Historic District statutes (to my own fiscal detriment, I might add), and working actively in and around the community groups.

    I don’t ask other folks to “help” me fix up my personal property so that I can then raise the rent.

    I think you are being a tad disingenuous, and before you start throwing stones you should know of which you speak.

    Good luck.


  • VR: I wasn’t making any claims as to what you may or may not have done personally. I did however want to note how I’ve seen some pretty vocal ‘activists’ (for lack of a better word) do nothing more than talk. I have plenty of real examples that wouldn’t be appropriate to share in a public forum.
    If you ever have suggestions on what might help please contact me.
    And ironically, new tenants that I’ve brought into all of the buildings referenced in the story pay LESS rent than the previous tenants. Sometimes a LOT less (for NICER units). It seems counter intuitive but sometimes you have to make a unit nicer and charge less for it to attract the tenants you want (as ‘good’ tenants have more rental choices than ‘bad’ tenants). The trade-off (advantage) is a more stable tenant base which should lead to less turn over, less maintenance, and less management. That’s my theory anyway. I could be wrong.

  • Note to self: Vonroach seems pissy.

  • The interference from the city is staggering. If anyone believes they own their own property, they are flat wrong. Try to work on your legally owned, private property in any substantive way and see what happens. It is amazing the level of detailed regulation associated with every home improvement activity. What is more staggering is the number of neighbors who will call to report work they believe is unpermitted. They just call and call and call. Much easier to tear down and start over as opening up a wall or touching one part of building means the whole thing needs to be “upgraded.” The funny thing is, with all this regulation and all this nitpicking, most of what I see is still built like shit.

  • I think the city, and or council needs a person like Cody. The fines and processes are truly so time and money consuming, it does hurt everyone more than it helps. I have run into many people who love what he has done.

  • Sometimes I’m pissy.

    Sometimes I am just pissed.

    OK, Cody! I am actually happy to see you doing good, and I hope you do well by it.

    My wife and I always thought that both the 502 building and the one down the street seemed like a set from “The Wire”.

    I really do mean it when I say Good Luck with that.

  • Hey Cody. It’s Mike, your fellow FMC landlord and Colquitt endcap. Congrats on the new acquisition. Any data yet on (hopefully) reduced crime activity at the first two Skylane projects? Might be my imagination, but it seems like incidents are down in the area for the last few months. (knock on city-approved wood)

  • Cody- thanks for tour…Hope the City will give you a break as you are improving the property(ies)for the better. Keep up the good work!

  • I’m just glad that now I won’t be harassed when I go to pick up from Texas Pizza!

  • Takara So is for sale. Hope springs eternal. It’s actually not a bad complex. A friend lives there. Some of the tenants, however, leave much to be desired. Although the manager the past year has gotten better about not looking the other way. After the owner decided to let her not look the other way. One assumes part of “due diligence” these days is pulling up HPD call reports. And then checking to see if the tenants are still there.

  • I am curious as to how the upcoming “condemnation” by Metro is going to affect this and other complexes along Richmond that are already literally sitting on the existing sidewalk. I guess Metro will “flip a coin” as to whether it takes land on the north side of the street or the south side of the street.

  • Cody does seem like a good guy. Which is why I decided not to apply for the manager position. Having lived at 219 for awhile, I miss the closet although that is all I miss, I’m afraid I would have been fired the first day after I filed evictions on everyone who was still there although I will say the “street traffic” ain’t what it used to be so obviously Cody got rid of the worst at both 219 and 502.

  • I’m with Tanith… the Heights Skylane is ripe for improvement. We looked at a few properties within 2 blocks of it but decided to purchase elsewhere based on the Skylane. It too houses quite a few tenants with records. I’d even be happy to help with it.

  • This is a damn good story. Guy fixin’ up the city one step at a time. I like reading about things like that and will look forward to any updates in the future as to how the properties are changing for the better.

  • To kilray

    Traffic if down, but not gone — by a long shot. One tenant runs a crackhouse out of his unit night and day. (his customer like to crawl over the front fence.) Mangement has claimed 2x he was evicted, then reneged. Last word was he was evicted. Latest is, the front gate lock is smashed — proboably some crackhead. still unfixed. I’ve adobpted a wait-and-see attitude with this gang. My lease expires in Dec. Been here since before the magnificant Cody Lutsch took over. I’m one of those tenants who always pays on time, etc. What happens between now and December will determine if I stay of if another landlord would like a good tenant.

  • Cody,

    As a committed person to Montrose what neighborhood associations do you participate in? Also I notice none of your buildings in the Montlew Assoc display the “local: neighborhood watch signs that ask people to report crimes. Why is that?I know they will get torn down in many of your place because of the renters but I encourage you to keep trying if you are really committed to helping the neighborhoods.

    Yes it is great that you buy property and put in minimum investment , so it is 100% occupied by low rent tenants, so that you can flip. Not sure how low rent tenants help the neighborhood, but have to trust you on that on.

    Would seem to me that get better quaility tenants would be better for the neighborhood, which is what you state your motivation is. Still don’t understand how low rent tents do anything for the neighborhood but certainly helps you flip the properties.

    If you are as committed as you say you are please be more active in the associations and also help us count down on crime in the neighborhoods.

  • I can only give anecdotal reports on crime now vs. when I bought them. Though I’m sure the local police, remaining tenants, and neighbors, would back up my claim that it’s gone down a lot. I know what I used to see when I bought some of these places (you wouldn’t believe some of the stories) vs. what I see today. In the properties that were the subject of this story, anywhere between 50% and 90% of the tenants have been replaced.
    I participate in the Westmoreland civic association as I have an apartment building in that subdivision, as well as my own personal home (which I just moved into from another home in Westmoreland that I now rent out). I also try to meet with the civic groups a building is located in when I buy a new property (as I did with my last one). I also will send out reports each month for the first few months to keep everyone updated.
    As far as low rent tenants… The rent is a function of market demand. There are limits to what I can raise it to, especially considering all the buildings in this story are older studios. Ironically at times you may get less rent at a building after fixing it up as you’re going after a more desirable tenant. Tenants with stable job history, credit, and clean background have more choices so often you have to charge less to get them. On the flip side, ‘bad’ tenants that you may not want will often pay more for a place simply because not many places will take them.
    At my last property I bought, 30 of the 43 units have been upgraded and new tenants put in place — in just a few months. 100% of those new tenants pay less than the tenant that was in there before, but that’s a trade off I’ll make to get a more stable tenant that pays on-time, online, and won’t be selling drugs or having the cops called out every other day. Again, I’m not claiming to take less rent for a better tenant solely out of heartfelt civic duty (though as a neighbor myself, that’s a benefit), but also because I think long term its financially advantageous both from a building value and operational standpoint.
    Are there still some bad tenants? Yes. Of course. I have to pick my battles. Normally that means starting with the worst, and working my way down. I’m not in a position to buy a property, kick everyone out, fix everything all at once, then re-lease the place. I don’t have any other outside investors kicking in so I can only work at the pace my savings and the buildings income will allow. Actually, I did get an investment from a neighbor once which allowed me to do things very quickly (and they were paid back a few months later in full).
    Regarding fixing these to flip. I almost never buy a property in Montrose with the intention to flip. In fact I’ve only bought one for that purpose (a small 6 unit). I’ve only sold 3 of my Montrose places since I started investing and all of those I wish I still had. I typically don’t sell anything unless I have to (“have to” being subjective.. Typically meaning there is another property I’d like to buy and a smaller property I have has enough equity in it to allow for the purchase of a new one). If I had other investors or banks were actually lending, I’d likely never sell anything.
    Anyway, this reply is already way too long. Feel free contact me via e-mail me if you want more info or have any suggestions (codybiz at gmail)