The Private Equity Stakeholder Project (PESP) and Alliance of Californians for Community Empowerment (ACCE) released a new report, “Blackstone Comes to Collect: How America’s Largest Landlord and Wall Street’s Highest Paid CEO Are Jacking Up Rents and Ramping Up Evictions.” The report highlights San Diego County, where private equity firm Blackstone purchased 5,600 naturally occurring affordable housing units in 2021 and how, as units become vacant, the company has raised rents in some units between 43-64% in just 2 years, (AB 1482 pegs annual raises above 10%, for existing tenants, as price gouging).
As San Diego becomes increasingly unaffordable, throwing more families into homelessness, Blackstone’s aggressiveness as the third largest landlord in the area in hiking up rents for its thousands of units only adds to the problem. For instance, at the Fashion Hills apartment complex, the average rent as of September 2021 was $1,641/mo. Under California law, the maximum cap of 10% for an annual rent hike would mean an increase to an average of $1,805. Yet, Blackstone is listing 1 bedroom units starting at $2,354/mo (43% higher than the previous average) and 2 bedrooms starting at $2,690/mo (64% higher than the previous average). By jacking up the price of their units Blackstone is rapidly dwindling the number of affordable housing units in the area – exacerbating an already dire affordable housing shortage.
Key Points from the Report:
- Blackstone owns and manages over 300,000 units of rental housing in the U.S., making it the largest landlord in the U.S.
- In the last two years, Blackstone has been on an aggressive buying spree, expanding its residential real estate empire by snapping up various single-family and multi-family rental properties, adding over 200,000 housing units to its portfolio.
- Until August 2022, Blackstone had a voluntary eviction moratorium for tenants who were behind on rent. Since then, Blackstone has initiated a wave of evictions in a number of states and counties documented in this report. For instance, Blackstone filed over 350 evictions in Florida between August and November 2022.
- If this trend was present at all of its properties, then it means that Blackstone would have filed to evict thousands of tenants in the last six months of 2022 alone.
- There may be even more evictions coming as Blackstone may impose large rent hikes. In December 2022, the head of Americas real estate for Blackstone estimated that the private equity firm can increase rents 20% higher than the company was charging.
- Blackstone also spent millions of dollars fighting against rent control in California. Blackstone gave over $7 million in 2018 and more than $7 million in 2020 to oppose statewide ballot initiatives that would have limited rent increases.