Tenants Association of Witten (Ruhr, Germany)
From the point of view of the Tenants Association of Witten (Ruhr, Germany) we can very much welcome the actions of today in Barcelone, New York City and San Francisco, which protested against the housing business of Blackstone, one of the largest private equity firms worldwide.
In our region since the last decade we had to learn that the business models of companies like Blackstone are creating social and physical damage in our cities. They do not only rob former publicly controlled and financed social housing stocks from the people and trsform into merchandises at liberalized property markets. They are also transforming the whole social infrastructure of peoples housing into a playground for transnational financial speculations. This creates heavy damage for our cities and daily life. Rent increases, uncontrolled mortgage bubbles, systemic material disinvestments, precarious working conditions for the employees, bad maintenance and value stripped housing companies are the necessary consequence of a “financial industry”, which is using the (expected) cash flows from rents and mortgage interest for the construction of speculative financial “products”, offered globally to wealthy people and financial funds.
Rental mass housing in Germany has been heavily affected by sell outs to transnational private equity funds since 2000. Among the actors of the transaction chains were also Blackstone funds (Bremen, Berlin, Mannheim). But – following its opportunistic business model – the “engagements” of Blackstone in these investments only were short term and Blackstone in general did not play a major role in it compared to other financial investors like TerraFirma (UK based), Fortress (US) , GoldmanSachs, MorganStanley, Cerberus… In Germany more than 1 million former social rental housing units through state promoted privatisations and transaction processes got under direct control of transnational financial markets. After exits of the funds during the past 2 years today most of the financial investments in German housing assets meanwhile is organized via publicly listed joint stock companies. Among major shareholders are sovereign wealth funds from Norway and Abu Dhabi but also funds managed by big investment companies like Landsowne (hedge funds), SunLife (secrurities and funds), Wellington and Blackrock, which actually is a former spin off from Blackstone, today with more the 4000 bn. USD assets under management. Because of all the liquid capital seeking for good “performance“ (halfway secure and a profitable assets) the international speculative business of the new real estate joint stock companies in Germany is booming. The market capitalization of the largest stock companies has nearly doubled within 18 months. A very fast concentration process is going on in this sector, creating i.e. a housing stock company with more than 350.000 units… In our towns in the Ruhr district 10 – 20 % of the rental housing stock is directly controlled by joint stock companies and financial investors. As tenant unions we are permanently struggling with them.
From this background we feel very related to the actions of today, although we are not specifically faced to Blackstone as a direct financial investor into our landlord firms at the moment.
We think the today action has been one of the first coordinated transnational actions against Real Estate Private Equity at this scale.
Even if the main struggle is about reclaiming social control on the housing stocks at the local grass roots through its users, although the main solution is the expropriation of the housing-capitalists and the socialisation of the whole housing system, it is also important to take more action steps at transnational levels. Becoming able to blame the wrong system at the real stage of its transnational development may be a precondition for the invention of non-nationalist, non-exclusive answers to the global crisis of hosuing and cities. We hope that transnational activism against transnational financial landlords and mortgage speculators continues, enlarges and that we may learn to organize strategically, so that one day transnational corporate action can become one of our daily tools in the defence of the right of tenants and homeless and mortgage victims at many places.