Wednesday 16 October 2019

Blackstone warned that Denmark will act on high apartment rents

New order: Denmark’s new Prime Minister Metter Frederiksen has promised a more equal society and has criticised corporate greed
New order: Denmark’s new Prime Minister Metter Frederiksen has promised a more equal society and has criticised corporate greed

Morten Buttler

Denmark's new left-wing government pledged tough laws to control housing costs and singled out Blackstone Group for "unsustainable" rental practices.

Kaare Dybvad, the Danish housing minister, said Blackstone is "challenging" local legislation "where there are holes." By taking advantage of those holes, the concern is that properties are being bought up and then rented out at prices Danes are finding difficult to afford.

Speaking in an interview in Copenhagen, Dybvad said: "It's clear we need to do something about this.

"We're not going to legislate around an individual firm, but the way this has been going so far isn't sustainable.

"If Blackstone chooses to conduct itself in a different way in Denmark, in a more sustainable way here than in many other places in the world, then it's clear that they're allowed to be here on the same terms as others."

Dybvad said the Social Democrat government which has ruled Denmark since June, will now start formulating stricter laws to address the concerns. He has previously criticised Blackstone for "driving up prices in the Copenhagen rental market" and making it harder for low-income earners to remain in the city.

The housing minister laid out his plans as Denmark's parliament met for its first session since the summer break. As the chamber reconvened, prime minister Mette Frederiksen took the opportunity to lash out at what she described as corporate greed.

The 41-year-old became Denmark's youngest ever head of government this year after promising a more equal society with increased spending on welfare. Her government's budget proposal means Denmark will need to raise its borrowing requirement for next year by about $2.3bn (€2.1bn), the finance ministry estimates.

Frederiksen also used her speech to lawmakers to zero in on the housing market. "An American private-equity fund is purchasing our houses," she said. And she touched on the list of financial scandals that have angered Danish voters in recent years. "Does greed know no boundaries? Apparently not," she said.

Blackstone has said it's a long-term investor in the Danish market, and that it complies with all regulations.

Bloomberg

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