Dec. 8 was a red-letter day for shareholders in Mid-America Apartment Communities, an owner of 300 apartment complexes across the country. That’s when their company announced it was doing well enough, even during a pandemic, to raise the dividend paid to investors by 2.5 percent.
For some Mid-America tenants, though, Dec. 8 was dire. That day, the company filed eviction proceedings against 13 renters in Florida, Georgia and Texas, court records show.
In spite of a federal moratorium barring ousters of tenants who attest they have been affected by Covid, eviction filings continue to course through the country. These proceedings harm renters in many ways: Evictions often result in job losses, academic research shows, and generally appear on credit reports, making it difficult for renters to find new residences. Eviction costs can also be added to rent bills, increasing the amounts ultimately owed by renters to their landlords.
Recognizing the ravages of evictions, President-elect Joe Biden has called on Congress to provide another $30 billion in rental assistance, on top of the $25 billion set aside in the December 2020 stimulus package. He has also requested an unspecified amount of money for legal aid and an extension of the moratorium, which was imposed by the Centers for Disease Control and Prevention, through Sept. 30.
But a moratorium only works if it is well-enforced, tenant advocates say, and actual evictions are still happening, according to legal aid practitioners.
Diane Yentl, president and CEO of the National Low Income Housing Coalition, said Biden’s proposal could be a tremendous help to struggling families. But she said simply extending the CDC ban is insufficient.
“While the CDC order imposes criminal penalties on landlords who violate the moratorium,” said Yentl, “no entity or persons are enforcing the order and there is no mechanism for renters to file complaints against landlords who violate the order. … An eviction moratorium issued by the Biden administration should bar all stages of the eviction process, including notices, filings, hearings, and physical evictions.” Criminal penalties include fines and jail time.
Meanwhile, eviction filings continue to grow, with many brought by large, prosperous companies. And while eviction filings are only the first step in the process to oust tenants, they often scare renters into leaving without a fight, advocates say. As a result, these filings alone can increase homelessness or create the kind overcrowding the CDC hoped to avoid with its ban.
Since Sept. 2, for example, when the CDC announced the moratorium, Mid-America has filed 384 evictions in 23 counties in 5 states, court records show. Documents submitted by tenants in many of these cases state they cannot pay their rent because they’ve been affected by Covid, an attestation the CDC ban requires.
Mid-America owns 102,000 homes in 16 states and its recent evictions were filed even as it prospered. In addition to raising its dividend, its stock price is up 11 percent since Sept. 2.
A spokeswoman for Mid-America said the company’s eviction processes “fully comply with the terms of the CDC order as well as state and local laws and orders.” The company only files eviction proceedings as a last resort, she said.
“We offered a range of rent-deferral agreements as well as the option to end leases without termination fees,” the spokeswoman added. “We also provided information about where to apply for financial assistance from various government, charitable and civic organizations.”
Other large and wealthy corporate landlords are also bringing eviction actions against tenants during the moratorium, according to a database compiled by the PE Stakeholder Project, a nonprofit that examines the impact private equity companies have on communities. The ban is scheduled to end Jan. 31.
Ventron Management is one such company. A large Canadian real estate concern that owns 21 apartment complexes in Georgia and Florida, Ventron had filed 649 eviction actions in those counties by yearend, according to the data. Another is Blue Magma Residential, a Tampa company that filed 344 evictions during the period; it owns more than 10,000 apartments in 18 locations.
NBC News could not determine how many of those actions were brought against tenants who filed CDC attestations.
“We’ve seen more than 30,000 eviction filings by large landlords since the moratorium took effect,” said Jim Baker, executive director of the PE Stakeholder Project. “We’re not suggesting the majority of those are violations of the law but we believe somebody should be looking into whether or not companies are indeed following the law.”
Also troubling, tenant advocates say, is the fact that some of the larger companies pursuing evictions during the moratorium have received government assistance, loan records show.
Ventron, for example, received between $2 and $5 million under the Paycheck Protection Program last April, a federal forgivable loan initiative aimed at helping small businesses survive the pandemic. Ventron filed roughly 250 eviction actions the week after the company received the PPP money, court records show.
Ventron has not responded to two emails seeking comment.
Blue Magma Residential received between $1 and $2 million in PPP money last April. It also received $150,000 in an economic injury disaster loan from the Small Business Administration in June.
Blue Magma did not respond to an email seeking comment.
“Real estate companies getting this money should not be evicting people,” said Scott Klinger, of Jobs with Justice, a nonprofit that promotes union rights and has published a report on companies that received government backing and filed evictions. “This provokes a bigger discussion of how we ensure corporate responsibility when we give federal assistance to corporations.”
Mid-America did not receive PPP funds, but it got another type of government backing last summer when the Federal Reserve paid $3.3 million to buy $3 million of the company’s bonds. The purchases were part of the Fed’s debt buying program designed to shore up the corporate bond market and companies issuing debt in it, records show. That market had been depressed by investors’ fears about Covid-related financial problems among corporations.
The Fed’s bond purchases gave Mid-America a boost, helping it raise $450 million in fresh debt in August, likely at a lower cost than the company would have paid otherwise.
The Mid-America spokeswoman did not provide a response to criticism about companies filing evictions while receiving federal aid.
Questions about evictions among companies receiving government aid arise as a second PPP program is being launched. The $900 billion stimulus package passed late last year by Congress provides for an additional $284 billion of PPP funding.
Ebony Denise Turner of Miami is going through an eviction brought by her landlord, Blue Magma Residential. She contracted Covid in late summer and was granted a leave from her job at the Transportation Security Administration, according to documents filed with the court. She took a salary cut, she told NBC News, and could not afford her rent. She paid what she could, she said, and filed a CDC form stating that she’d been affected by Covid, which was reviewed by NBC News.
Blue Magma filed eviction proceedings anyway in October, court filings show. After that, the company stopped returning Turner’s calls and emails, she said. She is now living with her sister and received approval in late December for rental assistance through a local nonprofit. Blue Magma said the money from rental assistance wasn’t enough, Turner said.
“At the time I got sick, there was no accommodation, no understanding,” Turner said in a phone interview. “After knowing everything that’s going on, it’s shocking to me. I never thought it would happen to me.”
Turner is scheduled for an eviction hearing with a mediator on Wednesday. The amount her landlord says she owes includes late fees and charges related to the eviction, Turner said. She added that the apartment complex was not well-kept and that her complaints about a hole in her kitchen floor and a fungus growing on her front door were not remedied.
Blue Magma did not respond to questions about Turner’s case.
Research confirms that big corporate landlords pursue eviction actions more aggressively than their smaller counterparts do. A 2016 study by the Federal Reserve Bank of Atlanta analyzed evictions in the Atlanta area and found that corporate landlords are more likely to file eviction notices than small landlords, noting that “some of the largest firms file eviction notices on a third of their properties in a year.” Private equity rental property owners “have uniquely high eviction rates,” the study also found.
The report also concluded that “large corporate landlords backed by institutional investors are far more likely to pursue eviction than others,” suggesting landlords pursue evictions to satisfy investors’ demands for profitability. The researchers note that eviction filings can be a technique for rent collection and recommend further research to determine whether higher rates of actual evictions are being pursued by these landlords.
Higher eviction numbers among corporate landlords may be at least partly explained by the cookie-cutter mindset at the top of these companies, said Shamus Roller, executive director at the National Housing Law Center. “They create rules about when someone gets evicted and remove as much discretion from the front-line employees as possible,” he told NBC News. “Most people find it hard to evict someone they know. The corporate structure removes that knowledge and sentiment.”