Report exposes how real estate industry, private equity firms maintain housing crisis

An intricate network of housing industry groups, often backed by corporate landlords, are actively blocking solutions that would alleviate the worst aspects of the current housing crisis and improve affordability, according to a new report. 

The report, from Capital Strategies for the Common Good, the Private Equity Stakeholder Project, Bargaining for the Common Good, and Americans for Financial Reform Education Fund, sheds light on the money behind the political influence that has distorted the politics of housing in favor of wealthy interests, in response to a recent surge in tenant organizing at local, state, and federal levels has begun to challenge the status quo. 

“Corporate landlords do not merely profit off of the housing crisis to the tune of billions of dollars,” said Dustin Duong, research associate at Americans for Financial Reform Education Fund. “They then plow that money into lobbying efforts that stall or bury efforts to relieve the crisis. It is a vicious circle of money, politics, and industry influence.”

“Who is Behind the Curtain” examines the tactics employed by the real estate industry to counter the growing momentum of tenant-led movements for affordable housing and fair rent policies. The report highlights the leading companies and individuals in the real estate sector that are working to stall solutions to the housing crisis. By tracing the flow of resources, including $569 million in lobbying and political contributions at the state and federal level from 2019 to 2022, the report provides a clear picture of the funding and strategies employed to counter tenant organizing and perpetuate the housing crisis.

Trade associations with resources of over $2.5 billion have led the opposition. The National Multifamily Housing Council, National Association of Realtors, and the National Apartment Association, heavily backed by large investment firms such as Berkshire Hathaway Inc., Starwood Capital Group, and CBRE Group Inc., and large apartment owners like Bozzuto, Greystar Real Estate Partners and Equity Residential, have aggressively fought against rent stabilization, eviction moratoria, and other policies that protect tenants.

“Workers and tenants are uniting to fight for common sense housing protections because we’re paying half of what we make for a roof over our head,” said Sara Myklebust, research director at Bargaining for the Common Good, based at Georgetown University’s Kalmanovitz Initiative. “They are going up against some of the largest, most powerful companies in the country like Greystar and Blackstone. The trade associations they lead have assembled over $500 million dollars to oppose bold, transformative policies that would help build a more just and equitable housing system.”

The report includes a case study of private equity firm Blackstone’s years of campaigning against rent control and other pro-tenant initiatives in California, in some cases using money raised from pension funds to finance opposition to these proposals. In 2018 and 2020, for example, the firm contributed $6.2 million and $7 million respectively to opposition efforts against ballot proposals that would allow municipalities to enact rent control measures in California. A similar rent control initiative is set to be voted on by Californians in November 2024. 

“We have seen cases in California in which public workers’ hard-earned pension money is being used by private equity firms like Blackstone to combat common-sense tenant protections, undermining workers’ financial stability and housing security, said Mad Bankson, senior research and campaign coordinator at the Private Equity Stakeholder Project. “Rent control is on the ballot in California in November. Public workers, tenant unions, and organizers should be aware of how corporate landlords are working against solutions to the affordable housing crisis in California and across the country.”

“Californians consistently identify high housing costs and homelessness as two of the top issues they want to see lawmakers address,” said Christina Livingston, Executive Director of the Alliance of Californians For Community Empowerment (ACCE). “However, to date, state and local governments have failed to pass policies or make investments commensurate with the scale of the problem. Why? One of the major reasons is the powerful and deep-pocketed corporate real estate lobby led by the California Apartment Association (CAA). While the CAA often claims to represent mom-and-pop landlords, the CAA’s agenda primarily serves their Wall Street corporate landlord leadership. The business model of these mega-corporate landlords is predicated on increasing profits at all costs by raising rents, neglecting maintenance, and evicting frequently – to the detriment of our cities, our communities, and our families.”