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Hedge Funds: The Ultimate Absentee Landlords

rogerrinaldi

How Wall Street capitalized on the foreclosure crisis to become the nation’s largest owner of single-family homes.

This article appears in the Fall 2015 issue of The American Prospect magazine. Subscribe here.

Each month, Esperanza Rosales sends $1,785 to the Blackstone Group, one of the world’s largest private equity firms. Steve Schwarzman, the CEO, has a net worth of $11.8 billion and last year earned $690 million. He owns a Park Avenue apartment, a villa in Jamaica, and large estates in Palm Beach, the Hamptons, and St. Tropez. Rosales, a 45-year-old seamstress, pays her rent to Invitation Homes, a Blackstone subsidiary established in 2012, which owns the modest 1,200-square-foot house in South Los Angeles where she lives with her husband (who is unemployed), her four children (one of whom is autistic), and her daughter Yuri’s three children. Rosales explains that her nine-member household…

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