London Daily

Focus on the big picture.
Wednesday, Jul 30, 2025

Ruthless private equity firms gobble up property and wreak havoc on tenants' lives

Ruthless private equity firms gobble up property and wreak havoc on tenants' lives

Multibillion-pound firms like Blackstone have become leading property players. People who need homes are paying the price

Parents at the Fount nursery in London’s East End were taken aback recently when fees for their children’s care went up by more than £200 a month.

The reason for the price hike? The nursery is based in a former railway arch and there had been a massive 49.2% increase in rent by the new landlord, US private equity firm Blackstone, following a £1.5bn sell-off by Network Rail of network arches around the UK.

On 13 September, the Commons public accounts committee issued a scathing report on the controversial sale of thousands of railway arches to a joint venture between Blackstone and Telereal Trillium. The MPs accused Network Rail of selling off a profitable asset for short-term gain, with a loss of income of at least £80m and potentially up to £160m a year. They also said the sale would mean fewer rights for future tenants, as well as denying existing tenants the option to extend their leases.

Rachel Munro-Peebles, who owns the nursery, faced a difficult decision: close the nursery or increase fees. She describes Blackstone as “ruthless”, pursuing a hardcore increase in rent that threatens the survival of her business. Hence the unpleasant news for parents.

But few of them would realise what they have in common with similar rent rises faced by a baker in Berlin, a bar owner in Toronto, and tenants in housing in Stockholm or Madrid.

The common factor is £6.7bn private equity behemoth Blackstone, now reported to be the biggest landlord in the world. It manages assets worth £123bn, including property in parts of Berlin, Toronto, Madrid, Dublin and Stockholm, where it is the biggest private owner of low-income housing

Local battles against rising rents, such as the protests against plans to redevelop railway arches in Brixton, where only nine of the original 39 businesses remain, are often reported as struggles against gentrification. But this is not gentrification. This is not about working-class areas being taken over by incoming hipsters and middle-class residents and businesses.

This is another phenomenon entirely. This is about how global private equity firms have become leading players in the property market since the 2008 crash. This was predicted by the late geographer Neil Smith in the 1970s, who argued that when the gap becomes big enough between the rent a property earns and what it could earn if redeveloped for new residents, private capital would flow in, attracted by the potential to make large profits.

The result is that since the financial crisis, many parts of London and other cities have become unrecognisable. UN special rapporteur on housing and human rights Leilani Farha says the commodification of real estate by private equity investors in recent years had made housing for many people increasingly expensive and precarious. “Landlords have become faceless corporations wreaking havoc with tenants’ right to security,” said Farha earlier this year, in a stinging critique of the role of companies like Blackstone in contributing to the global housing crisis.

She has written to Blackstone and to government officials in the Czech Republic, Denmark, Ireland, Spain, Sweden and the US, accusing the company of undertaking “aggressive evictions” to protect its rental income streams, shrinking the pool of affordable housing in some areas and effectively pushing low- and middle-income tenants from their homes. Her work on this has also been highlighted in a recent documentary by Swedish film-maker Fredrik Gertten.

On its website, Blackstone, which disputed the claims and said the UN report contained “numerous false claims, significant factual errors and inaccurate conclusions”, tells investors it seeks to “acquire high quality investments at discounts to replacement cost” – corporate speak for buying up assets cheap. It particularly favours what economists call “distressed markets”, as these have the greatest potential for capital growth. This includes repossessed homes in the US and Spain as well as increased activity in the UK – the company recently made a controversial move into the UK’s low-income housing market through for-profit housing provider Sage.

Following the financial crash Stephen Schwarzman, the company’s billionaire chief executive, described Blackstone’s strategy in Europe as “basically waiting to see how beaten up people’s psyches get, and where they’re willing to sell assets … You want to wait until there’s really blood in the streets.” Schwarzman recently gave Oxford University £150m – its largest single donation since the Renaissance – to fund a humanities centre that will be named after him. It’s a move to burnish his image that is unlikely to allay concerns about his company’s activities.

Meanwhile, despite reassurances from the company that now owns so many former railway arches, local communities remain fearful, including Munro-Peebles, who says Blackstone isn’t listening to any of its tenants. “How are we supposed to survive?”

Newsletter

Related Articles

0:00
0:00
Close
Former Judge Charged After Drunk Driving Crash Kills Comedian in Brazil
Jeff Bezos hasn’t paid a dollar in taxes for decades. He makes billions and pays $0 in taxes, LEGALLY
China Increases Use of Exit Bans Amid Rising U.S. Tensions
IMF Upgrades Global Growth Forecast as Weaker Dollar Supports Outlook
Procter & Gamble to Raise U.S. Prices to Offset One‑Billion‑Dollar Tariff Cost
House Republicans Move to Defund OECD Over Global Tax Dispute
Botswana Seeks Controlling Stake in De Beers as Anglo American Prepares Exit
Trump Administration Proposes Repeal of Obama‑Era Endangerment Finding, Dismantling Regulatory Basis for CO₂ Emissions Limits
France Opens Criminal Investigation into X Over Algorithm Manipulation Allegations
A family has been arrested in the UK for displaying the British flag
Mel Gibson refuses to work with Robert De Niro, saying, "Keep that woke clown away from me."
Trump Steamrolls EU in Landmark Trade Win: US–EU Trade Deal Imposes 15% Tariff on European Imports
ChatGPT CEO Sam Altman says people share personal info with ChatGPT but don’t know chats can be used as court evidence in legal cases.
The British propaganda channel BBC News lies again.
Deputy attorney general's second day of meeting with Ghislaine Maxwell has concluded
Controversial March in Switzerland Features Men Dressed in Nazi Uniforms
Politics is a good business: Barack Obama’s Reported Net Worth Growth, 1990–2025
Thai Civilian Death Toll Rises to 12 in Cambodian Cross-Border Attacks
TSUNAMI: Trump Just Crossed the Rubicon—And There’s No Turning Back
Over 120 Criminal Cases Dismissed in Boston Amid Public Defender Shortage
UN's Top Court Declares Environmental Protection a Legal Obligation Under International Law
"Crazy Thing": OpenAI's Sam Altman Warns Of AI Voice Fraud Crisis In Banking
The Podcaster Who Accidentally Revealed He Earns Over $10 Million a Year
Trump Announces $550 Billion Japanese Investment and New Trade Agreements with Indonesia and the Philippines
US Treasury Secretary Calls for Institutional Review of Federal Reserve Amid AI‑Driven Growth Expectations
UK Government Considers Dropping Demand for Apple Encryption Backdoor
Severe Flooding in South Korea Claims Lives Amid Ongoing Rescue Operations
Japanese Man Discovers Family Connection Through DNA Testing After Decades of Separation
Russia Signals Openness to Ukraine Peace Talks Amid Escalating Drone Warfare
Switzerland Implements Ban on Mammography Screening
Japanese Prime Minister Vows to Stay After Coalition Loses Upper House Majority
Pogacar Extends Dominance with Stage Fifteen Triumph at Tour de France
CEO Resigns Amid Controversy Over Relationship with HR Executive
Man Dies After Being Pulled Into MRI Machine Due to Metal Chain in New York Clinic
NVIDIA Achieves $4 Trillion Valuation Amid AI Demand
US Revokes Visas of Brazilian Corrupted Judges Amid Fake Bolsonaro Investigation
U.S. Congress Approves Rescissions Act Cutting Federal Funding for NPR and PBS
North Korea Restricts Foreign Tourist Access to New Seaside Resort
Brazil's Supreme Court Imposes Radical Restrictions on Former President Bolsonaro
Centrist Criticism of von der Leyen Resurfaces as she Survives EU Confidence Vote
Judge Criticizes DOJ Over Secrecy in Dropping Charges Against Gang Leader
Apple Closes $16.5 Billion Tax Dispute With Ireland
Von der Leyen Faces Setback Over €2 Trillion EU Budget Proposal
UK and Germany Collaborate on Global Military Equipment Sales
Trump Plans Over 10% Tariffs on African and Caribbean Nations
Flying Taxi CEO Reclaims Billionaire Status After Stock Surge
Epstein Files Deepen Republican Party Divide
Zuckerberg Faces $8 Billion Privacy Lawsuit From Meta Shareholders
FIFA Pressured to Rethink World Cup Calendar Due to Climate Change
SpaceX Nears $400 Billion Valuation With New Share Sale
×