Looking at an old map of the area, Ossulston Street looks to be a decent area (if I have the right street and it's the one that runs into Euston Road?). Most houses have a yard/garden, though one side of the street does contain railway goods sheds. I can't see any housing for criminals or institutions of any sort in the near vicinity.
Note though that the map I am looking at is later than when your family were living there. I will look for an earlier map to compare.
Added. I have found an earlier map, but not much detail, but at this time Ossulston Street appears to have been housing on both sides as it is pre St Pancras Station. I will continue looking ....
...if you can recall the name of the criminal's housing or whereabouts it was, that might be very useful in trying to locate it.