HUD cuts funding to Peppertree Apartments

MEMPHIS, Tenn. (WMC) - The Department of Housing and Urban Development (HUD) has ended its contract with Peppertree and pulled funding to the apartments due to “the owner not providing decent, safe, and sanitary housing,” the City of Memphis announced Thursday.

HUD will begin a funded voucher program that will aid residents in relocation; those vouchers will be issued within the next 60 days.

The apartments have long dealt with safety concerns.

The Peppertree apartment complex was deemed a public nuisance by the city and Shelby County District Attorney’s Office back in November 2021... and that was not the first time.

Tonight, there are hundreds of residents who still live there... questioning what comes next.

For years, the Peppertree Apartments have been plagued by fires, unsanitary living conditions, and safety concerns.

Thursday in Shelby County Federal Court, Peppertree owner TESCO Properties and the city agreed to extend the order preventing new leases at the complex for another 120 days.

However, City of Memphis Chief Legal Officer Jennifer Sink says the Department of Housing and Urban Development went a different route, abating their contract.

“There were two different inspections that were conducted of the property, and the owner received failing scores, and apparently is now default, so HUD had a remedy available to them and the ability to cancel that HAP contract... that’s what they elected to do,” Sink said.

It’s welcome news for Memphis officials, who have been in and out of federal and environmental court with the embattled complex.

“This has been a long road and it has been going on for quite a while, so we’re happy to see some kind of resolution, because ultimately, what this means is that those residents are going to find themselves living in a place that safe, that’s decent and that’s sanitary,” said Sink.

Shelby County District Attorney Steve Mulroy echoes that sentiment.

In a statement he told Action News 5:

“We agree with Mayor Strickland that this is a necessary development. While forcing residents to relocate is always unfortunate, these tenants deserve safe and healthy conditions. We’re glad that our efforts have borne fruit, and that HUD and the City will assist in relocation efforts.”

HUD has not said where Peppertree’s residents like Connie Huddleston will go.

“It makes me upset and I want to cry,” Huddleston said. “Probably I’ll go home and cry, because this is all I got. If they close it down or anything like that, I’m going to be out in the street. I’ve been homeless five times already.”

For others like Tanya Williams, who didn’t want to go on camera, this is a chance at a fresh start.

“I can’t do nothing but praise God,” said Williams. “I can’t thank God [enough] for everything he has walked me through this whole three years at these apartments. I can’t do nothing but thank him, because if it wasn’t for him, I wouldn’t know what to do.”

The defense counsel for TESCO properties told Action News 5 today they had no comment on HUD pulling their contract... effective next Saturday.

We’re also waiting to hear back from HUD.

Back in August, the apartments were barred from taking on new tenants, a ruling that came after structural damage was exposed at the apartments.

Earlier that month, a walkway collapsed, which led to the apartments being cited by Memphis Code Enforcement. Two people were injured and taken to the hospital as a result.

Also in August, the leasing office burned to the ground.

Between August and December, Memphis police were called to the complex more than 50 times, according to the Memphis Data Hub, with crimes ranging from theft to aggravated assault.

In 2021, the complex was deemed a public nuisance following 1,600 police service calls to the complex over a 20-month period.

The apartment’s defense team was in court earlier this year to argue why they could stay open, but the city has long called for them to be vacated.

Memphis Mayor Jim Strickland called HUD’s decision great news.

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