A new investigation from The Center for Investigative Reporting found that one of President Donald Trump’s closest friends used the housing crisis to become a major Atlanta “slumlord.”
The report, “Profiting off pain,” focuses on Thomas J. Barrack, founder of Colony Starwood Homes. According to The New York Times, he is such close friends with Trump that he was the one who introduced him to campaign manager Paul Manafort, who is being investigated over possible election meddling by Russia.
Colony Starwood owns nearly 5,900 homes in the metro area, which makes Atlanta its largest market. According to the report, maintenance is an an afterthought:
In a speech to a University of Chicago real estate conference in 2012, Barrack – tall, fit, pacing the room like a motivational speaker – likened managing thousands of homes spread across the country to running a chain of McDonald’s restaurants or Kinko’s copy shops.
“Acquisition, retrofit” and rent it out, he told the audience. “I can’t get a plumber to come to my house for $1,500 an hour and we retrofit many of these houses for $1,500 total.”
An emerging body of evidence tells the other side of that story. For starters, while the company puts $19,000 into these homes when it buys them, according to the company’s annual prospectus released last year, it spent just $800 on maintenance per home in 2016.
One tenant told reporters she and her family went without heat during the winter, and that a ceiling caved in on top of her and her infant son.
Colony Starwood was one of the institutional investors found in a January report by the Federal Reserve to be evicting a high percentage of their tenants. As we previously reported, these investors, which gobbled up foreclosed homes across the Atlanta area, may be contributing to the region’s eviction crisis.