Blackstone to offer cheaper rents in hundreds of Copenhagen homes

Controversial American investment firm Blackstone, which owns a large number of rental homes in Copenhagen, is to offer reduced rents in some of its properties.

Blackstone to offer cheaper rents in hundreds of Copenhagen homes
File photo: Brendan Mcdermid/Reuters/Ritzau Scanpix

The Danish government last year announced initiatives aimed at reining in the firm’s speculation on the housing market.

Media in the Scandinavian country, including DR and Politiken, reported Blackstone’s decision to reduce rents on Tuesday amid long-term bad press for the firm in Denmark, where it bought 160 properties with 2,300 homes in Copenhagen alone between 2017 and 2019.

LLO, a national members’ organization for people who live in rental properties, has meanwhile warned tenants to take care before accepting offers of lower rent.

READ ALSO: Denmark to push back on high rents with law against housing speculators

Criticism of the company has revolved primarily of its use of section 5.2 of the Danish Housing Regulations Act (boligreguleringsloven). The clause allows landlords to significantly raise rents in pre-1992 properties if 250,000 kroner is invested in the apartment.

In December, Minister for Transport and Housing Kaare Dybvad said he was ready to propose a law against what he termed ‘housing speculators', with the aim of slowing increases to rents. The minister specifically mentioned Blackstone in comments given to media.

Dybvad is still negotiating with other parties in order to gain a parliamentary majority in favour of the measures, Politiken reports.

But Blackstone has now chosen to change direction by voluntarily putting rents down into about 300 homes in the capital. Some tenants could therefore save up to thousands of kroner monthly.

Kereby the name of Blackstone’s Danish branch, told Politiken via a written comment that “we have looked at where we would like our rent levels to be”.

“We have reviewed our existing leases, and have seen that some of our rents are not at that level,” the company added.

In a press release, the company also said it wants to “focus on doing business in a respectful, responsible and professional way” and to improve “the satisfaction of our tenants… raising the level of service in our long-term business here in Copenhagen.”

LLO regional director Claus Højte told Politiken that he saw Blackstone's surprising move as “on initial impressions, beautiful and an example to others in the industry”.

But he also stressed that tenants who have received offers of cheaper rent should be cautious.

“Right now we have 51 cases against Kereby/Blackstone with the Rent Appeals Board [Danish: Huslejenævnet, ed.], and in several of them they have wanted to settle on lower rents, but we think their offers are still too high,” Højte said.

“If you as a tenant say yes to the rent that Kereby/Blackstone is offering now, you might be prevented from getting an even lower rent,” he explained.

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Copenhagen to miss 2025 zero emissions target

Copenhagen will not reach its longstanding target of becoming CO2 emissions neutral by 2025.

Cyclists on Copenhagen's
Cyclists on Copenhagen's "Lille Langebro" bridge. The Danish capital has admitted to errors in emissions calculations and says it won't be climate neutral in 2025, a long-standing target. Photo by Febiyan on Unsplash

A city councillor told newspaper Jyllands-Posten that the city, which has long stated its aim of becoming the world’s first CO2-neutral capital, would not meet that target as scheduled.

“I won’t need to stand there in 2025 and say ‘hurrah, we’re CO2 neutral’, because I know that CO2 will still be emitted (then),” elected representative Ninna Hedeager Olsen of the Copenhagen Municipality environment section told Jyllands-Posten.

Tourist board Visit Denmark has previously used the emissions goal to market the city, while Prime Minister Mette Frederiksen named the target during the C40 climate summit when it was hosted by Copenhagen in 2019.

But the municipality has included wind energy produced in other municipalities in its calculations on energy sustainability, according to the newspaper report.

This means it effectively still emits CO2 overall.

The company which supplies energy to the city, Hofor, has erected windmills in a number of municipalities outside of Copenhagen. But the electricity produced by these windmills has been used in calculations of CO2 emissions in both Copenhagen and in the municipalities in which the windmills are actually located.

The replication of the energy production in data for different locations can “rightly” be said to be “cheating the scales”, according to Hedeager Olsen.

But that is not the only problem in calculations of the city’s emissions, she also admitted.

“There are loads of things that haven’t been counted,” she said.

The goal to become climate neutral by 2025 was first set by the city in 2012 in a climate plan adopted by the city government.

Copenhagen was the following year awarded the Cities Climate Leadership award for the plan.