That rumor just doesn't make sense... If he wanted to flip it in a quick transaction, the strategy is to find a crappy place, buy it crappy, do minor improvements, increase all the rents slightly and sell it for a higher amount for the value of the increased cash flow... not the property improvements. If he already owns it... I don't see the incentive to let it get run down.
Unless he's figuring that it's going to sell based on it's cash flow anyway so there's no reason to put any improvements into it, but if that were the case... I would think he'd already have it on the market...
Jenna.... I'm going to say the rumor is bunk... with the information you've given.... it just doesn't make any sense.