Huntsville Sues Lurin Capital Over Apartment Conditions

Multifamily distress at Lurin Capital is translating to deteriorating conditions at the firm’s remaining properties, a new lawsuit filed against Jon Venetos’ Dallas-based company shows.

The city of Huntsville, Alabama is the latest municipality to sue the firm over conditions at one of its properties. In a Madison County Circuit Court lawsuit filed Jan. 2, the city claims Lurin has abandoned The Flats at Redstone, a 231-unit property at 2022 Golf Road.

The lawsuit paints a bleak picture of the property Huntsville claims has been vacant for two years, with no utility service, missing windows and doors, a boarded-up exterior, overgrown weeds, siding hanging off of the buildings, a dilapidated metal playset and a pool full of dirty water.

The condition “poses a substantial risk of illness or injury to anyone who enters the property,” according to the lawsuit.

The city first flagged unsafe conditions at the property in February 2022. Lurin obtained building permits for improvements at the property, but didn’t complete all of them, the lawsuit claims.

In August, the city sent seven code violation notices to Venetos, giving the company until Dec. 15 to resolve the issues. It failed to do so, the city alleges. It’s asking the court to issue an injunction ordering Lurin to fix the property and order that it be sold if Lurin doesn’t correct the code violations.

The lawsuit comes as residents of The Sutton, another Lurin-owned apartment complex in Huntsville, face days without running water, the local NBC affiliate reported. Residents of the property at 190 Shelton Road told the outlet they’ve been using bottled water to bathe and flush their toilets for nearly a week.

The city of Huntsville joins a growing club of lenders, vendors, cities and landlords suing Jon Venetos and his firm over unpaid bills and poor conditions at Lurin-owned properties.

In November, the firm was hit with a temporary restraining order that ordered residents of a Lurin-owned property in Plano to vacate due to unsafe conditions, including lack of access to water, sewer or gas.

Acore Capital Mortgage kicked off the crush of lawsuits in the spring when it said Venetos defaulted on nearly $400 million in loans tied to 12 properties in Florida. Since then, Fannie Mae sued Venetos and Lurin over an alleged $77 million default. Vista Bank and Keybank also filed lawsuits claiming defaults. In a series of October lawsuits, Acore claimed that Venetos personally guaranteed the money he borrowed from the lender and still owes $81 million.

Venetos was also sued by his Uptown Dallas office landlord, Rosewood Property Group, claiming he personally guaranteed the lease he bailed on at Rosewood Court and owes the landlord $5.3 million.

The lawsuits by Keybank and Vista include claims of fraud. Keybank alleged Venetos transferred $24,570 from his accounts with the bank to a personal account. Vista accused him of falsifying account statements from the lender in an attempt to take out loans elsewhere. Former employees have also come out to accuse Lurin of lying on loan reimbursement requests to lenders by inflating costs of repairs and submitting invoices for work that wasn’t done.