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Lawmakers: “We are deeply concerned that KKR’s multi-billion dollar real estate purchase could result in even higher rents, exacerbating America’s housing crisis.”

Text of Letter (PDF)

October 25, 2024 - Washington, D.C. — On Thursday, U.S. Senators Elizabeth Warren (D-Mass.), Reverend Raphael Warnock (D-Ga.), Ron Wyden (D-Ore.), and Peter Welch (D-Vt.) wrote to private equity firm KKR regarding its recent $2.1 billion real estate acquisition of 5,200 apartment units across the country — KKR’s “largest-ever purchase of apartment buildings.” The lawmakers highlighted the dangers of private equity’s involvement in the housing market and pressed KKR on its plans to set rent prices, protect tenants’ safety, and ensure long-term tenants can remain in their homes following the acquisition. 

KKR’s purchase is the latest in a long history of private equity firms using the housing crisis to rake in profits by driving up rent costs and squeezing families. In an April 2024 Market Report, a KKR executive appeared to explicitly describe its strategy to buy up distressed properties and increase rents for Americans, noting that KKR is “optimistic about rent growth given the structural shortage of housing and unfavorable cost dynamics for new construction in the United States.”

“We have long raised alarm bells regarding private equity’s encroachment into the housing market,” wrote the lawmakers. “We are deeply concerned that KKR’s multi-billion dollar real estate purchase could result in even higher rents, exacerbating America’s housing crisis.”

In June, KKR announced that it had acquired a portfolio of 18 multifamily assets concentrated in the Coastal and Sunbelt markets. The deal follows billion-dollar real estate purchases by Blackstone and Brookfield, seemingly signaling a “growing confidence among large investors that rents and values for apartments will soon begin rising again” and exposing a pattern of private equity’s encroachment into the housing market.

“Private equity firms have disproportionately pushed people of color out of affordable single-family homes and their communities through gentrification and negligent landlord practices…Whether the property is a mobile home park, single-family rental, or multi-family building, the private equity purchase playbook remains the same,” wrote the lawmakers.

Senator Warren recently reintroduced the Stop Wall Street Looting Act, comprehensive legislation to fundamentally reform the private equity industry by closing loopholes that allow private equity to capture all the rewards of their investments while insulating themselves from risk and liability.

Senator Warren has long led the fight to make housing more affordable for families and has held companies accountable for their role in exacerbating housing costs:

• In October 2024, Senator Warren (D-Mass.) and Representative Jamaal Bowman (D-N.Y.) led a letter with over 30 lawmakers to President Biden praising him for his actions to confront the housing crisis and proposing additional executive actions to lower the cost of housing.

• In September 2024, Senators Warren (D-Mass.) and Ed Markey (D-Mass.), and Representative Seth Moulton (D-MA-06), demanded answers from 13 corporate landlords operating in Massachusetts, asking whether they are using RealPage’s algorithm to raise rents for families.

• In August 2024, Senators Warren (D-Mass.) and Catherine Cortez Masto (D-Nev.), sent letters to each of the 11 Federal Home Loan Banks (FHLBanks) urging them to contribute at least 20% of their net income to affordable housing and other critical community grant programs.

• In July 2024, Senators Warren and Raphael Warnock (D-GA), and Representative Emanuel Cleaver (D-MO-5) reintroduced the American Housing and Economic Mobility Act, the landmark legislation to tackle the housing crisis, bring down costs for renters and buyers, and help working families everywhere find a decent place to live at a decent price. 

• In July 2024, Senator Warren and Representative Sara Jacobs led Senator Tim Kaine, Senator Jon Ossoff, Representative Ro Khanna, and Representative James Moylan in calling out the Department of Defense (DoD) for failing to protect military families living in military housing operated by private companies under the Military Housing Privatization Initiative (MHPI).

• In June 2024, Senator Warren sent a letter to the Federal Housing Finance Agency (FHFA) urging the agency to address our country’s affordable housing crisis by reforming the broken Federal Home Loan Bank (FHLB) System.

• In May 2024, Senator Warren reintroduced the Public Housing Emergency Response Act to address the estimated $70 billion backlog of maintenance and repairs in our nation’s public housing, which would allow tenants to live in safe conditions and ensure that, as we fight to end the housing crisis by expanding the supply of affordable housing, we are not losing existing units to disrepair.

• In April 2024, At a hearing of the Senate Banking, Housing, and Urban Affairs Committee, U.S. Senator Warren called out the Federal Home Loan Banks (FHLBs) for failing to deliver on their mission to provide affordable housing as the country faces a housing crisis.

• In January 2024, Senator Warren, John Hickenlooper, Jacky Rosen, and Sheldon Whitehouse sent a letter to Federal Reserve (Fed) Chair Jerome Powell, calling on the Fed to reverse its troubling interest rate hikes that have driven mortgage rates to 20-year highs and have put affordable housing out of reach for too many Americans.

• In March 2023, Senators Elizabeth Warren, Ed Markey, Tina Smith, and Bernie Sanders sent a letter to Jonathan Kanter, Assistant Attorney General of the Antitrust Division at the Department of Justice (DOJ) calling for the DOJ to investigate YieldStar following new findings from their investigation of RealPage’s YieldStar product.

• In January 2023, Senator Warren, and Representative Jamaal Bowman led a letter with 48 lawmakers, urging President Biden to use every tool he has to address rent inflation, end corporate price gouging in the rental market, and ensure that renters and people experiencing homelessness across this country are stably housed this winter.

• In November 2022,  Senators Warren, Tina Smith (D-Minn.), Bernie Sanders (I-Vt.) and Edward J. Markey (D-Mass.) sent a letter to RealPage CEO Dana Jones, expressing concern about RealPage’s algorithmic pricing software, YieldStar, and its role in driving rising rents and exacerbating inflation.

• In August 2022, at a Senate Banking, Housing, and Urban Affairs (BHUA) Committee  hearing, Senator Warren called out corporate landlords’ growing role in the rental market and emphasized the need for a Tenant Protection Bureau to hold corporate landlords accountable and protect renters from extreme rent hikes, illegal eviction, and other predatory practices.

• In May 2022, Senators Warren and Reed sent a letter to Secretary of the Department of Housing and Urban Development (HUD), Marcia Fudge, calling on HUD to preserve homeownership affordability for American families as Wall Street firms expand their activity in the housing market.

• In March 2022, at a BHUA Committee hearing, Senator Warren called out Wall Street’s role in worsening the housing affordability crisis for seniors by buying up manufactured home communities

• In February 2022, Senator Warren called out private equity firms and other big investors for exacerbating inflation and locking families out of affordable housing opportunities. 

• In January 2022, Senator Warren sent letters to the CEOs of three private equity-backed firms—Progress Residential, American Homes 4 Rent, and Invitation Homes —calling out their growing activity in the housing market that has resulted in rent hikes and unaffordable homes for first-time buyers.

• In August 2021, during a hearing exchange with Senator Warren, a Department of Housing and Urban Development nominee committed to consider changes that facilitate sales of distressed homes to homeowners, not private equity firms.

• In July 2021, Senator Warren called on large corporate landlords to avoid needless evictions as the CDC eviction moratorium neared expiration. 

• In May 2021, at a hearing, Senator Warren made the case for her American Housing and Economic Mobility Act, which would create a new housing innovation grant program to reduce exclusionary local zoning laws.

• On April 2021, Senator Warren and Representative Emanuel Cleaver, II (D-Mo.) reintroduced the American Housing and Economic Mobility Act to bring down the costs for renters and buyers, level the playing field so working families can find a decent place to live at a decent price, reduce exclusionary zoning laws, and take a step towards addressing the effects of decades of housing discrimination on communities of color.

• In May 2019, Senator Warren and then-Representative Dave Loebsack (D-Iowa) wrote to the private equity firms behind some of the country's largest manufactured housing communities to request information about their use of predatory practices to boost profits in the communities they own.
  Source: Senator Elizabeth Warren