Source: Los Angeles Times —
With property values sinking, investors rushed to withdraw money from a real estate fund managed by private equity giant Blackstone last month. But the fund soon found a savior in the Golden State: The University of California poured in $4 billion even as other investors fled.
University officials said they believed the privately negotiated deal would provide profits and benefits for the college system, students and employees for years.
UC employees and housing advocates dispute that. They point out the fund has been buying up homes and apartments in California and other states, which they say is causing rents to rise and making the cost of housing even more unaffordable.
The letter called on the university to immediately divest its interests in Blackstone Real Estate Income Trust.
After the housing crash of 2008, Blackstone began buying up large numbers of single-family homes that banks had foreclosed upon and turning them into rentals. Other Wall Street firms followed suit, and investors big and small continue to scoop up an increasing number of homes across the country.
According to Redfin, the number of homes bought by investors reached a high of more than 20% of all purchased homes in late 2021, up from about 10% a decade before. That percentage has now fallen slightly as interest rates have risen, making property less attractive as an investment.
Blackstone reports that 55% of its $69-billion fund is invested in rental housing.
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