http://www.salon.com/2014/04/02/wall_streets_wily_front_group_inside_story_of_a_rental_schemes_secret_facelift/
The Wall Street rental scheme, the mass purchase of 200,000 single-family homes by hedge funds and private equity firms to convert to rental properties, has run into some trouble. Complaints from renters have proliferated, alleging that repairs go unaddressed, leases violate local tenant ordinances and unnecessary evictions often occur due to negligence. The plan to sell bonds backed by revenue from the rental properties has also stumbled. Collected rents on the initial rental-backed security from private equity giant Blackstone fell 7.6 percent from October 2013 to January 2014, suggesting that the homes aren’t being occupied at a level necessary to make the deal work. The Standard and Poor’s rating agency declined to offer a triple-A rating for the securities, and with fewer foreclosed properties to buy and higher home prices, many investors have cooled on the idea.
Nevertheless, the firms who already purchased the homes and put the scheme in motion have plowed ahead. Colony Capital, American Residential Properties and American Homes 4 Rent have all floated their own rental revenue bonds.
And now the major players in this space have done what every industry of questionable merit does in response to hardship – they created a trade group to lobby in Washington on their behalf.
The National Rental Home Council, unveiled last week, seeks to make Americans comfortable with their new Wall Street landlords. And the backers – Colony Capital, Blackstone subsidiary Invitation Homes, American Homes 4 Rent and Starwood Waypoint Residential Trust – hired some of the most skillful operators in Washington to aid them: a lobbying shop made up of veterans from the Clinton White House.
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