A man came out of the unit and confronted the neighbor, but then took off. The neighbor told police, he may have seen the man reach for an object, possibly a gun.
Officers then secured the neighborhood while firefighters knocked down the flames.
"So the most important thing that happened here out here today was no firemen were put at risk, no officers were put at risk. Everybody stayed safe," said Lt. Burke Farrah with the Fresno Police Dept.
Three surrounding schools were briefly "on alert" while police searched for the man described as being in his 30's with long hair in a ponytail and weighing 400-to-450 pounds.
Officers say he's known for staying in abandoned apartments and homes. They're looking into whether the man set the fire or was trying to put one out.