As metro Atlanta continues to deal with a housing shortage and high rent, a recent study led by Georgia State University researchers unveils the ironclad grip of three corporate giants over a staggering 11% of the city's rental properties.
Dr. Taylor Shelton, an assistant professor in the Department of Geosciences at Georgia State University, along with his collaborator Dr. Eric Seymour of Rutgers University, has shed light on the alarming concentration of single-family rental homes in metro Atlanta.
Who are the three companies?
The analysis, published in the Annals of the American Association of Geographers, exposes that three major companies - Invitation Homes, Pretium Partners, and Amherst Holdings - collectively own more than 19,000 rental houses, amounting to nearly 11% of available rental properties in the core counties of metro Atlanta.
“These companies own tens of thousands of properties in a relatively select set of neighborhoods, which allows them to exercise really significant market power over tenants and renters because they have such a large concentration of holdings in those neighborhoods,” Shelton said.
The study highlights the implications of corporate landlords in exacerbating Atlanta's affordable housing crisis, a subject extensively discussed by fellow GSU researcher Dr. Dan Immergluck.
"Stop letting all these overseas companies buy up all the land," said Te Julianne Brown, an advocate for affordable housing, who also rents from one of the big three companies. "There’s so much vacant land here, but what these investors companies are doing is they could care less about the local community."
Following the 2007 foreclosure crisis and continuing amid the COVID-19 pandemic, local landlords and homeowners faced pressures leading to property sales, facilitating the acquisition of large swathes of homes by corporate landlords for profit.
How LLCs work against tenants
Complicating matters further, the study touches on the intricate ownership structures of limited liability companies (LLCs) by these corporate landlords.
Shelton noted that this structure shields the parent companies from liability or legal action, creating a labyrinthine network that obscures direct accountability and complicates tenants' ability to address grievances.
"In this new landscape, figuring out exactly who owns each property can be incredibly complicated," the study reads adding that LLCs usually have multiple addresses making it hard to pinpoint their locations and parent companies.
Shelton explained that in metro Atlanta's key counties— Fulton, Clayton, DeKalb, Gwinnett and Cobb — the three largest landlord companies have more than 190 LLCs between them.
Unlike Invitation Homes, which is publicly traded and thus subject to disclosure requirements by the U.S. Securities and Exchange Commission, Pretium Partners and Amherst Holdings operate as private equity-backed entities, withholding comprehensive information about their property holdings from the public eye.
“They are requiring these high rental prices but not even making updates," Brown said. "You still have 1920 fixtures on these properties."
Keeping distance between tenants and rental companies
Shelton highlighted the layers of intermediaries, including property managers and regional supervisors, which often distance tenants from the decision-making entities, thereby complicating the resolution of issues.
“Layers of interaction that have to happen before you get to the person who’s ultimately making decisions are increased. You have to talk to your property manager,” Shelton said. “Then, the property manager has to talk to their supervisor, who talks to the local or regional manager. Then they have to run things up. It creates this distance where you don’t actually know who your landlord is, so you don’t actually know who to make demands of.”
Atlanta is the largest market for this kind of corporate landlord activity, according to another study by Shelton and Seymour.
“You have to add up the next two or three largest markets in the U.S. together to have the same amount of corporate landlord investment that Atlanta has,” Shelton said adding that landlords like cheap housing and places that are continuation to grow.
“But the other box that Atlanta checks is that we have very lax tenant protections," he said.
Shelton and his team have made their investigative methods accessible to the public, aiming to empower communities to scrutinize corporate landlord activity in their respective regions.
"We wanted to democratize this process, enabling anyone with access to relevant data to analyze corporate landlord ownership in their area," Shelton remarked.
“The hope is that anybody can take this method and replicate it even if you don’t have significant technical skills,” Shelton said. “We wanted to get to the skeleton of the logic of this process so that anyone can do it for anywhere and any company. All you need to have is the right data and then you can go from there.”
