Rundale

By Juliana Sassi

CATU Fingal, community anti-eviction,  24/08/23

This article is based on a talk delivered at Connolly Books for a panel entitled “Breaking the Grip of Landlordism”. The talk had three aims. First, to situate the housing struggle in Ireland within a global perspective, positioning Ireland within the capitalist system. Second, to describe the current stage in capitalism’s longue durée as monopolist. And finally, to connect these points to the rationality and practices associated with the provision of housing in Ireland today; precisely, the dominant role of Corporate Landlords’ (CLs) as an archetype of monopoly capital.

I aimed to link the housing question in a multi-spatial perspective that interconnects the local, the regional, the national, and the global while providing some insights into organising against CLs. This is particularly relevant because CL’s monopoly power is not restricted to the local scale, where they dominate the market and push up rents, but also because the funds/investors that back them up are monopoly firms on a global scale. 

Ireland’s dependency  

We live in a globalised capitalist mode of production and reproduction, shaped by imperialism, and colonial and postcolonial histories. In this context, I identify Ireland (like Conor McCabe, Patrick Bresnihan and Patrick Brodie) as a semi-peripheral country, mainly due to its dependency on foreign direct investment to develop its economy and address the needs of its population. This is central to the housing question today as after the 2007-8 Global Financial Crisis, monopoly capital has entered systematically into the Irish private rental sector, particularly in the form of CLs.

Since then, a series of policies and government programs have favoured the growth of CLs, such as the creation of the REIT legislation in 2013, the changes in the state’s rationality which moved from homeownership to long-term rental with the ‘Rebuilding Ireland’ Program, to the promotion of apartments as the most effective form of housing to address demographic and sustainability issues, and the flexibilisation of the meaning of social housing.

The Housing Assistant Payment (HAP), which was temporarily created in 2014, has since transferred millions to private landlords of all sorts and is perceived as a form of social housing by the Irish state – even though the security of tenure is precarious and many tenants are requested to “top up” their rents to equalise with the market rent as just 3% of rental properties available are affordable within the HAP scheme. 

An FOI request I sent to Dublin City Council revealed that in 2023, landlords with more than 100 properties received €67,499,600.88 through HAP, equivalent to 4,273 tenancies.  The 10 largest landlords getting paid through HAP received over €44 million alone, while this figure in 2015 was just over €33,000.  From 2015 to 2023, the total figure for the top 10 larger/corporate landlords recipients of HAP was over €160 million. 

Part V of the Planning and Development Acts 2000 to 2021, is also central to the marketization of public housing. It legislated for 10% – now 20% – of social housing units in new developments. Ultimately the state is leasing from the private sector and subsidising rents to private landlords as a form of social housing.

While HAP has privileged landlords of all sizes, the second policy relates to CLs as they are the ones with the capital to own such properties. Part V is a textbook  of a financialised social housing model in a macroeconomic context of a financialised global capitalism centred on monopoly capital needs.

The rise of monopoly capital into the private rental sector

Monopoly capital, as John Bellamy Foster puts it, is “embodied in the modern giant corporation, that, beginning in the last quarter of the nineteenth century, displaced the small family firm as the dominant economic unit of the system, marking the end of the freely competitive stage of capitalism and the beginning of monopoly capitalism”. However, it was with Hilferding and Lenin in the first and second decade of the twentieth century, respectively,  that monopoly was identified with finance capital. In both cases, the focus was on the banking sector, with the Deutsche Bank already mentioned as an example of monopoly. As capital expands its frontiers, it is remarkable that more than a century after their writings Deutsche Bank is one of the main investors in the Irish housing sector.

Today, the banks are no longer the hegemonic force operating in the financial sector, as many corporations have incorporated financial activities, and equity firms, REITS, mutual and pension funds have risen its relevance in the past decades.

However, Foster calls the competitive phase of capitalism transitory as, drawing on Marx, monopoly tendencies are inherent to capital’s accumulation logic which leads to an ever-growing concentration (of properties/capital) and centralisation (decision-making power).  David Harvey claims that “monopoly power is foundational rather than aberrational to the functioning of capital and that it exists in a contradictory unity with competition”. 

Non-Marxists have also identified monopoly as a feature of capitalism’s current stage. Looking at data on wealth concentration, the Oxfam Davos Report from 2024 made the case that such concentration is linked to a lack of public policies which allows corporate and monopoly power to reproduce inequality.

While monopoly is not a predicate of a specific sector, when looking at the financial and real estate sector, there is no doubt we are talking about a market for a few. For example, the 2024 Oxfam Davos report showed that the world’s richest 1% owns 43 per cent of all of the global financial assets. Private equity firms, which rely extensively on consolidation practices are “backed globally by US$5.8 trillion of investors’ cash since 2009 and have used privileged financial access to act as a monopolizing force across sectors”.

Regarding the residential sector, research looking at the financial accounts of the world’s fifteen largest residential REITs in the United States and Germany identified that the ownership of residential REIT stock is quite homogeneous, with the largest shareholders in each of the studied companies being the three largest index exchange-traded funds, which are heavily backed by pension fund capital.

Following the 2007-2008 financial crash, such capital came to Ireland to buy distressed assets (properties) and has since become invested in the private rental sector, where CLs have emerged. 

International capital investing in housing has been called vulture, or cuckoo funds,  corporate, institutional or financialised landlords. I use the term corporate landlords (CLs) to emphasise the fact they are a company, so they exist within a concrete (firm) structure, nonetheless financialised, whose main source of profit is residential rental properties. They may operate as vultures or cuckoos by taking away potential homes of first-time buyers, but this name has a pejorative meaning that may obfuscate what is the norm as an exception. By this, I mean that capitalism is inherently predatory, extractivist and a vulture preying and feeding on opportunities. Thus, it is not a special quality of CLs.

Corporate Landlord’s monopoly capital: from the global to the national scale

The CLs operating in Ireland, even those registered in the country such as IRES REIT and URBEO, are all backed up by international investors as the national capitalist class does not have the capital required, as I was told by CLs operating in Ireland. Approximately three-quarters of the investment in housing comes from the top 20 investors, including global players such as Kennedy Wilson, Greystar (both from US), Deutsche Bank, Patrizia (both German) and Orange Capital (Dutch). If we look at the real estate sector, the giant Blackstone tops the pool from 2012 to 2021, according to Daly’s research.  

IRES was even managed by the monopolist Canadian CAPREIT for years since its creation, while URBEO relies on investment from the huge US Starwood Capital to operate. CAPREIT’s property portfolio has grown to approximately $16.7 billion in 25 years and the firm now owns approximately 64,200 suites. Starwood Capital Group, which also is one of the top 10 investors in IRES, has invested over $245 billion of assets, including properties within every major real estate asset class.

The fact that CLs operating in Ireland claim they need international capital to deliver housing does not make the case per se for international investment in the residential sector in Ireland. While this is true from a market perspective, it was only in 2019 that they started to invest in new developments. Moreover, the hyper-reliance on international investors in housing is an expression of Ireland’s modern trajectory of dependency on foreign investment to address social needs in a context where international monopoly capital is looking for a spatial fix, for profit maximization, anywhere suitable. 

It is also telling of the role of the Irish capitalist class which operates as a middleman (the comprador class), acting on global capital’s behalf to shape legislation according to their needs, as Conor McCabe has argued, and managing their assets. The proximity with the state seems to be relevant as, for example, many high positions in URBEO are occupied by former NAMA employees. 

Corporate Landlord’s monopoly capital: From the regional to the local scale

Recently released data from the RTB showed that CLs own over 20% of the private rental sector in Dublin. However, spatial concentration is central to understanding CL’s logic of operations as they draw on a profit maximization strategy centred on scale. According to data from the All-Ireland Research Observatory (AIRO), there are many areas in Dublin where their presence is dominant. In Tallaght-Kingswood, CLs own over 65% of all rental properties, in Clondalkin-Moorfield they own 57%, and in Mountjoy B they own 42,40. In several other areas, CLs own more than 30%.

This concentration on small scales has been observed internationally and has led scholars in the US, for example, to call for anti-trust legislation to address this reality when analysing cases of monopoly or oligopoly in housing markets.

In addition, Corporate Landlords’ monopoly power is also a monopoly rent power. In the US and Canada, where CLs are more developed, they are relying on AI software to collude with one another to fix rent prices and are pushing rent up, which Baran and Sweezy  had already argued was a feature of monopoly capital. 

In Ireland, there is no such technology, however CLs benefit from the lack of regulation on rent charged for new tenancies, rent reviews and the lack of affordable or non-market supply. Specific to spatial concentration is the fact that if a landlord concentrates 20 or 30% of the rental properties in an area, they also shape the market price. 

Multiscalar tenant’s organising as a class imperative

It is important to say that knowledge about CLs’ monopoly power and its harmful effects has been generated by a transnational network of tenant organisations, including the Community Action Tenants Union (CATU), of which I am a member. This exchange of resources and education among tenants and tenants’ organisations is crucial to identifying who our targets are and ultimately bringing back a class analysis to the housing struggle by connecting the multi-spatial capitalist dynamic of speculation on housing. After all, the CLs here are also present in several countries as they hold billions in properties worldwide (which goes beyond the residential sector).

On the tenant’s side, the fact that CLs are concentrated geographically at the local scale paves the way to get organised to oppose them. This is already a reality in CATU as, for example, LRC RE-1, a Luxembourg fund, aimed to evict 89 tenants in several locations in Dublin from October 2022 to June 2023. Many of these tenants are CATU members and are fighting back. Almost all of them are migrants.

Uniting these tenants, who would otherwise be left on their own to fight a large international landlord, is what CATU can do. As Helen Moynihan, a CATU Leinster organiser said, direct actions should provide the basis for local CATU groups to organise tenants, empower their members and expand the union, as well as draw attention to the truly national nature of the housing crisis. To this, I would add that we should also draw attention to the international scale of the issue at hand. 

There is a huge potential for a multiscalar organising against the monopoly of homes in Ireland, and the rent strikes of the 1970s are again an inspiration. In ‘The Rent Strike’ documentary produced by CATU members, Matt Larkin Junior’s concluding argument was that: “our victory was our defeat”. In fairness, the 1970s was a decade of working-class defeats, as neoliberalism and financialisation arose in response to social revolt and capitalist crises.

However, this reflection is important because, even though our base is formed by people located in a specific place, with immediate needs, and acting locally, how we frame our demands and bring them to a national or international scale is central to achieving victories that can potentially impact more than one generation or segment of the working class. The hope is that this can bring us closer to our goal which should be the decommodification of housing and ourselves in this process.