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Dems Scored Real Estate Cash Before Letting Eviction Ban Expire

Democrats received a million dollars from a real estate mogul just before failing in their “relentless campaign” to extend a lifeline to struggling renters.
Dems Scored Real Estate Cash Before Letting Eviction Ban Expire
Photo credit: AP Photo/J. Scott Applewhite

House Democrats’ super PAC took in a million dollars from the chairman of a massive apartment rental company in June, before letting the federal eviction moratorium expire over the weekend amid a COVID-19 pandemic that continues to surge.

Last week, President Joe Biden’s administration belatedly called on Democrats in Congress to pass legislation to extend the Centers for Disease Control and Prevention’s (CDC) eviction ban only days before it was set to expire on July 31 — a full month after Supreme Court Justice Brett Kavanaugh wrote that the moratorium would have to be extended by legislation.

The late request by Biden’s press secretary Jen Psaki seemed to catch Democratic lawmakers off guard as they were getting ready to enjoy a long summer recess period. House Democrats tried to quickly pass legislation extending the moratorium by unanimous consent, a maneuver that Republicans blocked. Afterwards, the House adjourned, and lawmakers started streaming out of town.

House Speaker Nancy Pelosi said last Friday that Democratic leaders had only learned one day earlier that the Biden administration was counting on lawmakers to renew the eviction ban via legislation. However, she claimed the next day that her colleagues had led a “relentless campaign” to extend the moratorium, blaming Republicans for its failure. On Monday, Pelosi sent a letter to Democratic lawmakers arguing that “the moratorium must be extended by the administration.”

Soon after this, the Biden administration indicated in a statement it would keep trying to tackle the issue, noting that it’s directing federal agencies to “reexamine whether there are any other authorities to take additional actions to stop evictions.”

“In the meantime, the president will continue to do everything in his power to help renters from eviction,” noted the statement. The release did not explain why the White House waited to act until after the moratorium expired.

Democrats’ failure to extend the CDC’s eviction moratorium, which was first put in place by the Trump administration in September 2020, comes as the deadly delta COVID variant spreads around the nation, leading the CDC to urge people who are vaccinated to start wearing masks indoors again in public settings in places with high infection rates.

Allowing evictions to proceed will make the pandemic worse and will likely cause massive hardship on an unprecedented scale: Last year, researchers found that the expiration of state eviction bans had caused more than 400,000 new COVID cases between March and September. At least 3.6 million people are now facing the risk of eviction. That number could be far higher: According to the Aspen Institute, more than 15 million people are living in households that are behind on rent.

Meanwhile, Democrats have been raking in money from residential real estate interests that could benefit from the moratorium expiring.

“I’ve been looking at real estate, housing, and landlords for about 15 years, and this feels like an extension of what I have seen at the state and local levels,” said Sara Myklebust, Bargaining for the Common Good research director at Georgetown University's Kalmanovitz Initiative for Labor and the Working Poor. “You certainly see a pattern of landlords having close relationships as a result of money and influence, and that can affect the way lawmakers see these issues, the questions they ask, and the timelines on which they are willing to take action or not.”

Myklebust added: “It’s not shocking, because we have seen this pattern again and again. What is shocking is that millions of people are at risk of not just becoming homeless, but also getting a deadly disease.”

Millions From A Real Estate Tycoon

George Marcus, chairman of both the massive real estate brokerage Marcus & Millichap and the real estate investment trust Essex Property Trust, donated $1 million on June 1 to House Majority PAC, a super PAC that works to elect Democratic lawmakers. The donation amounted to nearly 7 percent of the total funding the committee has raised so far this year.

Marcus also donated $263,400 in June to a joint fundraising committee benefiting House Speaker Nancy Pelosi’s campaign, her leadership PAC, and the Democratic Congressional Campaign Committee (DCCC), the party committee that works to elect House Democrats.

During the 2020 election cycle, Marcus donated a combined $1 million to the DCCC and the Democratic Senatorial Campaign Committee, which elects Democratic Senate candidates. He contributed millions more to the party-aligned super PACs that aid those committees: $3.5 million to Senate Majority PAC and $3 million to House Majority PAC.

Marcus, who has a net worth of $1.7 billion, has also been a huge Biden supporter. He donated $4 million to super PACs that supported Biden: Priorities USA ($2 million), Unite the Country ($1 million), and American Bridge PAC ($1 million). He also hosted a Biden fundraiser in 2019, and donated $500,000 to the Biden Victory Fund, a joint fundraising committee benefiting the Biden campaign, the Democratic National Committee, and state parties.

Marcus & Millichap, founded by Marcus in 1971, is the largest commercial real estate brokerage in North America and sells apartment buildings, too. While Marcus is part of a group of billionaire landlords that have together seen their personal fortunes increase by nearly $25 billion since last March, Marcus & Millichap has been hit hard by the pandemic.

Marcus also chairs and founded Essex Property Trust, and he controls a 3 percent stake in the company, according to Forbes. As of last year, Essex Property Trust had an ownership interest in 60,272 apartment units in California and Washington state, according to company disclosures. Over the last two election cycles, Essex Property Trust donated $23.5 million to committees that opposed ballot initiatives that would have allowed rent control measures in California.

In its latest quarterly report, Essex Property Trust wrote that primarily as a result of the pandemic, its cash delinquency rate was “higher than the pre-pandemic period, but improved from 4.3% for the three months ended June 30, 2020 to 2.6% for the three months ended June 30, 2021.” The company said that it “has executed some payment plans and will continue to work with residents to collect such cash delinquencies.”

In an earnings call last week, Essex Property Trust CEO Michael Schall said that the company expects its delinquency rates will “return to normal levels over time, as more workers enter the workforce and eviction protections lapse on September 30 in both California and Washington.”

When asked about the expiring federal eviction moratorium, Schall said that “we expect to work with our residents to the extent we can.”

Corporate Interests Stand To Gain

Marcus is far from the only Democratic donor who stands to gain from the eviction moratorium expiring.

During the 2020 election cycle, executives from the Blackstone Group, the private equity giant, donated $2.3 million to Senate Majority PAC, $250,000 to House Majority PAC, and $350,000 to Unite the Country, the pro-Biden super PAC.

In June, Blackstone announced it was buying Home Partners of America, a single-family home rental business that owns more than 17,000 homes. Blackstone also became a minority investor last year in Tricon Residential, which owns more than 30,000 single family and multifamily rental homes in the United States and Canada.

Lobbyists for real estate interests have also been flooding Democrats with cash. The lobbying firm Brownstein Hyatt Farber Schreck has bundled $227,550 worth of donations for the DSCC this year. Brownstein’s lobbying clients include Apollo Global Management and Ares Management, two private equity firms with substantial real estate interests.

Akin Gump Strauss Hauer & Feld and its lobbyists have bundled $336,500 for the DSCC this year. The firm lobbies for Koch Industries, the conglomerate led by conservative billionaire Charles Koch that has been investing in residential real estate, specifically single-family rental homes, during the pandemic.

Another Akin Gump client, the National Association of Realtors, lobbied to end the CDC’s eviction ban. The firm also lobbies for KKR, a private equity giant with significant investments in luxury apartments.

Heather Podesta, who has raised $177,000 for the DSCC and $114,000 for the DCCC, is the founder and CEO of Invariant LLC, which lobbies for the National Association of Realtors and NAREIT, the National Association of Real Estate Investment Trusts.

Steve Elmendorf, a partner at Subject Matter, has raised $63,000 for the DCCC this year. His clients include Blackstone and the American Investment Council, a lobbying group for private equity firms. The National Realtors Association PAC has separately bundled $114,500 worth of donations for conservative Democratic Sen. Joe Manchin of West Virginia this year.


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