Billionaire Stephen Schwarzman, CEO of Blackstone Group, is one of the richest people on earth. In 2017, he drew a massive income of $786 million — and he’s worth $13.2 billion. It’s why Blackstone and its subsidiary, Invitation Homes, shelled out, in 2018, a whopping $7.4 million in campaign cash to stop the repeal of statewide rent control restrictions in California. He doesn’t want anyone messing with his billions.
Blackstone is one of the largest real estate private equity firms in the world, with assets of $119 billion that include 296,000 residential units and homes. Blackstone’s Invitation Homes, whose serious mistreatment of tenants was the subject of a 2018 Reuters special report, is one of the biggest landlords in the U.S. of single-family rental homes. Blackstone makes king-sized profits by charging king-sized rents — and Schwarzman is making a killing.
Schwarzman’s billions bankroll swanky parties for the rich and famous and at least five lavish homes in New York City, Saint-Tropez, Jamaica, East Hampton, and Palm Beach, where he spends winter weekends.
In California, though, nurses, teachers, and first responders struggle to pay unfair, excessive rents, and can’t afford even one home in the communities that they serve. Too many residents are homeless or at risk of becoming homelessness. That includes seniors on fixed incomes and college students.
Back in Palm Beach, Schwarzman is a neighbor to Donald Trump. Schwarzman and Trump are tight. The billionaire contributed $250,000 to Trump’s inaugural committee, and Blackstone gave more than $400 million to the problematic real estate projects of Trump’s son-in-law, Jared Kushner. According to the Washington Post, “Schwarzman has emerged as one of Trump’s most generous donors, as well as a key adviser with rare and regular access to the president.”
Schwarzman was no fan of President Barack Obama. In 2010, the billionaire compared Obama’s proposal to increase taxes on private equity firms to Nazism. “It’s war,” Schwarzman said. “It’s like when Hitler invaded Poland in 1939.”
While Schwarzman compared Obama to Hitler, Wells Fargo released a high-profile study, in 2018, about gender inequity on the boards of real estate investment trusts (REIT). Invitation Homes’ record was abysmal. From 2016 through 2018, Invitation Homes’ board was comprised of only 9 percent women — top-rated REITs have boards of 40 or 38 percent. In terms of female representation on its board, Invitation Homes was ranked the third worst out of 165 REITs studied.
Bill Ferguson, chief executive of Ferguson Partners, which also researched gender inequity on REIT boards, told the Wall Street Journal: “To be frank, the REIT industry is not the most enlightened group when it comes to diversity around the table.”
In 2019, the United Nations Special Rapporteur on the Right to Housing found that Blackstone was “wreaking havoc” in communities and helping to fuel the global housing affordability crisis.
Stephen Schwarzman will do anything to make more billions, disregarding the hard-working people that he hurts. Corporate greed, in fact, has helped cause California’s housing-affordability and homeless crises — the worst in the nation.
But we can fight back — and strengthen rent control and other tenant protections. Top experts at USC, UCLA, UC Berkeley, and Columbia University agree that rent control is key for stabilizing the housing affordability crisis. It’s why housing justice advocates recently launched the Rental Affordability Act.
Rent control puts a check on Schwarzman and other greedy corporate landlords. It returns power to us, and, in California, landlords are guaranteed by law a fair rate of return. We need rent control — now.