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The challenge is on! UN's housing advisors accuses #Blackstone Group, along with other private equity firms, of helping to fuel a global housing crisis

The UN Special Rapporteur on the right to housing, and the Chairperson of the Working Group on business and human rights, have written to one of the world’s largest investors in residential real estate, the Blackstone Group L.P ., expressing serious concerns that its actions are inconsistent with international human rights law.

Here the incredible Blackstone's reply

We encourage actvists to use the documents in their outreach. Hence the challenge is on!

UN Special Rapporteur on the Right to Adequate Housing, Leilani Farha and Surya Deva, the Chairperson of the Working Group on business and human rights, held a press conference in Copenhagen on Tuesday March 26th to speak about letters released (see links below) to governments and corporations around the world including the United States and Blackstone Group L.P.

The UN experts directly addressed the financialization of housing, including the policies and laws which support housing as a commodity. In the letters they emphasize these policies and laws do not reflect international human rights obligations. " contrary to international human rights obligations, investment in housing in the United States of America has disconnected housing from its core social purpose of providing people with a place to live in with security and dignity" .

Other governments receiving similar letters included the Czech Republic, Denmark, Spain, Ireland and Sweden.

The Challenge

The UN Experts have provided those of us who are organizers with an important tool to move our work forward.  But they can only echo our voices.

What are we going to do with this tool?

We need to inform housing activits of these documents and to encourage them to use the documents in their outreach.

We need to lend our voices to these letters. Those organizations doing housing work need to post these documents prominently on their websites, and getting them in the hands of our local elected and appointed officials.

Hence the challenge is on!

 

States and real estate private equity firms questioned for compliance with human rights

GENEVA (26 March 2019) – UN human rights experts have condemned the “egregious” business practices of giant private equity and investment firms which are scooping up low income and affordable homes around the world, upgrading them, and substantially raising rents, forcing tenants out of their own homes. 

Leilani Farha, the UN Special Rapporteur on the right to adequate housing, and Surya Deva, Chairperson of the Working Group on business and human rights, have written to one of the world’s largest investors in residential real estate, the Blackstone Group L.P., expressing serious concerns that its actions are inconsistent with international human rights law with respect to the right to housing and its responsibility to respect human rights under the UN Guiding Principles on Business and Human Rights.

“Almost overnight multinational private equity and asset management firms like Blackstone have become the biggest landlords in the world, purchasing thousands and thousands of units in North America, Europe, Asia and Latin America,” the experts said. “They have changed the global housing landscape. Pouring unprecedented amounts of capital into housing, they have converted homes into financial instruments and investments.

“Their business model, of which Blackstone is a frontrunner, is becoming the industry standard. Properties that are deemed ‘undervalued’, which generally means affordable to those living there, are being purchased en masse, renovated, and then offered at a higher rental rate, pricing tenants out of their own homes and communities. Landlords have become faceless corporations wreaking havoc with tenants’ right to security and contributing to the global housing crisis.”

The experts said they had heard countless stories of tenants’ whose buildings had been bought by private equity firms and whose rents had skyrocketed almost immediately afterward, sometimes by 30 or even 50 percent, making it impossible for them to remain. 

“Real estate equity firms have an independent responsibility to respect human rights, which means that they need to conduct human rights due diligence in order to identify, prevent, mitigate and account for how they address adverse impacts on the right to housing,” the experts said.

The Special Rapporteur and the Working Group have also sent letters to the Czech Republic, Denmark, Ireland, Spain, Sweden and the United States of America, noting that each had facilitated the financialisation of housing in their own countries through preferential tax laws and weak tenant protections among other measures.

“We remind States of their human rights obligations to regulate investment in residential real estate so that it supports the right to adequate housing and in no way undermines it. This cannot be left to the private sector to undertake on a voluntary basis,” the experts said.

“What makes this practice particularly egregious is that it is being done without any monitoring, or accountability mechanisms in place. Governments seem not to have made the connection that this new form of finance is taking place in an area that is governed by international human rights law, which imposes obligations on them. We remind all States, that while gold is a commodity, housing is not, it’s a human right.

“We want to alert States and private equity and asset management firms that the financialisation of housing in its current form runs afoul of international human rights norms and cannot continue. At this time we have identified six States, but there are many more where these same issues are of serious concern, including in the global South. We are ready to engage in a dialogue with all relevant States and financial investors as to how this problem can be addressed,” the experts said.


 

The letters sent and replies received are available here:

Business enterprises

States:

Keywords

Blackstone

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