 Hey everyone! Before we get started with Don't Call Me Resilient today, I wanted to let you know about another podcast I've been listening to lately. It's called Democracy-ish. In it, hosts Danielle and Wajahat break down the chaotic politics in the U.S. from a black and brown perspective. They keep things real as they share their blunt and quirky analysis of the current state of affairs. And they have a great goal, to envision a true multiracial democracy. Anyways, I like it, and I think you might too. You can find Democracy-ish wherever you get your podcasts. From The Conversation, this is Don't Call Me Resilient. I'm Vanitha Srivastava. We're so focused on the displacement of residents, but what's also being lost is a history, a culture, that has been in these communities for decades. For many everyday ordinary people in Canada, housing has emerged as one of the most challenging issues. With inflation and interest rate hikes, being able to afford housing has been on the top of everyone's minds. This is especially true in our largest cities, where financial stress plagues many households. Home ownership is widely out of reach. And for renters, housing is scarce and expensive. In Toronto, Canada's largest city, vacancy rates are at their lowest level in nearly two decades. And average rents have jumped nearly 10%, the sharpest increase in more than a decade. One of the factors driving this affordability crisis has been a shift away from publicly built housing toward large corporate-owned buildings. As today's guest puts it, now housing is treated as a commodity rather than a human right. Professor Nimoy Lewis from the School of Urban and Regional Planning at Toronto Metropolitan University is here to discuss the disproportionate impacts these corporate landlords are having on Black and low-income communities. He says it's leading to income-polarized cities and urban centres that are increasingly accessible to only a small group of wealthy people. Nimoy, thank you so much for joining me today. Oh, thank you for having me. We've all seen the headlines. We're in the middle of a housing crisis. What are you seeing across the socioeconomic spectrum? We're seeing a lot of folks are spending a significant portion of their income on shelter. We're seeing that folks are making certain sacrifice they would otherwise would not have to if housing was affordable. And some of these sacrifices are not conducive to a healthy lifestyle. What we're seeing is folks are skipping meals. Folks are cutting back on groceries. Folks are relying extensively on the food bank to make ends meet. Or in some cases, folks are robbing Peter to pay Paul. They're sacrificing maybe things like nutrition or food or other parts of their budgets that's necessary to pay their rent. Yes. And so folks are spending upwards of 50 to 60 or even 78% of their household income on shelter. What do they have remaining to pay for things such as personal care items? Or making sacrifices and where they might not turn on the heat in some of those colder months just to save on their energy bills. And so those are significant sacrifices that I think that folks are making in order to remain housed in urban centers like Toronto. You're talking about people who are renting, but there's also a group of people who, you know, maybe have had the dream of home ownership. What's happening broadly across the city, across all economic spectrums? There's also folks that because of, you know, the different types of mortgages that they acquire, they use to acquire their homes. Some might have used variable rate mortgages, which was very popular during the height of the pandemic where folks thought that interest rates were just going to remain in the basement. And, you know, there are folks in where their mortgages have increased upwards of more than $2,000 a month because of the rate hikes. You know, a lot of folks, you know, that I've talked to are like struggling. Back in the summer, folks were found to be shoplifting from grocery stores. And that prompted stores like, you know, Walmart to remove self-checkouts from, I think, two of their locations. And one of the things that's coming out of these stories is that it's not folks that are struggling in terms of paying their rents, but these are folks that have mortgages and are residing in owner-occupied housing and, you know, find themselves in these difficult situations in where they might have to make tough life decisions that impact their own freedom. So we are in a place of crisis. I keep pausing when I say crisis because I know that it's an ongoing issue and it's been an ongoing for at least a decade longer. But how did we get here to this moment, to this place of crisis today? Very good question. And I think the reason why I say this is a very good question is because there's a lot of folks that are of the belief is almost like as if this crisis or this housing emergency started overnight or within the last five years. I think the seeds were sown in the early to mid-90s following the departure of both the federal and provincial governments from the housing business. More specifically in the context of Ontario, we had then Premier Mike Harris under who ran on this common sense revolution idea, essentially that the private sector was all suited to address some of society's needs, you know, in the context of our conversation, housing being one of them. And they essentially cut back on various assistance that were being provided and it was all under the guise of reducing taxes. What ended up happening was the government started to invest more in demand side subsidies to encourage home ownership. And at the time, home ownership rates were doing well. And there was this belief that, you know, the market was assisting folks through getting folks to be homeowners. And so we didn't need to intervene. So we've got Mike Harris in Ontario, but across Canada, I'm sure there were other similar stories taking place. And so it's not just a provincial issue in Ontario. So folks, leaders like Mike Harris decided that social housing was not the answer. And therefore what happened? At the time during the 90s, the market was doing well. Lots of folks were getting into home ownership. First time home buyer taxes were introduced to help incentivize folks to acquire owner occupied housing as opposed to relying on the state to provide social housing. The difficulty was that we had increase in our population, not just from immigration, but also from folks migrating from other parts of the country to some of the major urban centers. We didn't have enough housing to actually house a lot of these folks. And so there was this idea that developers had promised to the government that these changes would equate to 20,000 rental units to be built in the greater Toronto area. Actually, they fell short of that by about just over 18,000 units. So not a lot of units were built. And instead, what was actually built was condominiums, which we still see today in terms of a number of condominiums that continue to be built in centers like Toronto and Vancouver. You know, you're going to shift away the responsibility of housing from government as a social housing premise to the market. What's wrong with that? What governments fail to understand is that businesses have especially publicly traded companies, but even private companies as well, they have a legal and fiduciary responsibilities to maximize returns for investors. Those mandates and those legal requirements put them at odds in terms of trying to establish affordability in the market. And so because we weren't building purposeful rentals, we saw a significant increase in rental rates across this province. And we saw a tremendous drop in terms of the vacancy rates. And as a result, a landlord's market in where a landlord can essentially pick and choose who they want to rent to. And as a result, folks are going to have to pay a premium if they want to pay if they want to continue to reside in the city. And so this sort of trend continued for the last two decades. But then what changed in the market was the players. And so we started to see the introduction of real estate investment trusts, which could be publicly traded companies, but it also could be a private company as well. As we moved forward to in the early 2000, we started to see another types of landlords started to enter the market. And these include private equity firms, asset management firms. So what I mean by an example of an asset management firm is like a starlight investment, which is the largest private landlord in this country with over 61,000 rental units, 20,000 of those units are in the city of Toronto. They are the largest private landlord in Toronto. You're saying the type of landlord change. So we're going away from sort of mom and pop landlords to these corporate, these huge corporate entities that are scaling up. So you've sat down with a bunch of data on this particular issue. Can you tell us what you were looking for? And also what you found? The inspiration I got to do this particular project started roughly about in 2018. There was a report that was released by the Wellesley Institute that tell that black renters were twice as likely to experience an eviction than any other racial group in the city. But the story sort of ends right there. And we didn't get to know who's responsible for all of these eviction filings and what changed in the market that where we're seeing this growth of evictions that are disproportionately impacted black renters. So we acquired roughly about 27 years of multifamily transactions data in the city of Toronto. And we examined all these transactions and then categorize all these different landlords from financialized landlords, which we define as a purchasing company, either privately held asset management firm, or a publicly traded company like a real estate investment trust, which essentially acquires rental properties, as you mentioned at scale. So scale is what helps to differentiate these types of landlords from your everyday profiteering landlord in the market. And what also helps to differentiate them is their access to lawyers and a litany of portfolio analysts that help them in their legal and fiduciary responsibility and maximizing returns, making sure that the operation is efficient, but more importantly that all the moves that they're making to generate those lucrative returns for their unit holders and shareholders are legal. They have deep pocket, I guess is what you're saying. Yes. And you used a term there, which I think is important. You said a financialized landlord. And you describe that as a corporate entity. Can you explain that a little because I think this is at the heart of what you're talking about. Yes. So these are entities that essentially treat multifamily properties as an asset class rather than treating multifamily property as a human right, as opposed to treating housing as a place for shelter, as a place to protect one from the elements or inclement climates. I like how you said they treat housing as a commodity and not as a human right. Tell us what you were looking for with your data and what you found. So what I was looking for within my data was to understand how these investment and management practices were influencing the lived experiences and neighborhood choices of black renters across the city. And so what we found was that over the course of the last 27 years, financialized landlords accounted for 65% of all the units that were transacted in the city of Toronto. Wow, that's a high number. Okay, tell us more. So we know that as across the whole city that these entities are acquiring a large swath of multifamily property. But we also wanted to know where they're acquiring the properties. Then you went and looked at it geographically and started to map what this looked like in the city. So we decided that we wanted to map to understand the geography of their transactions. Where the black population is 30% or greater, financialized landlords accounted for 65% of the units transacted. And a lot of this geography is in the northwest quadrant of the city. So I'm wondering, aren't there protections in place for some of these communities that we're talking about? Corporate landlords, aren't there protections in place for everyday people, everyday renters? Yes, there are a lot of the units that that these entities are acquiring are protected under rent control. The difficulty is that once these entity acquire these properties, they might undertake various renovations. So typically what these entities like to do is acquire what they call underutilized properties. These are properties that are not operating at their full potential. The rents are well below market rents. These are properties that have vast amount of inefficiencies that is preventing them from meeting their potential or rents or the potential revenue that they could actually accumulate if they were operated more efficiently. What I found is that landlords in certain geographies where these communities have been gentrified or they're either on the verge of being gentrified, landlords for tenants that are protected under rent control, the landlord might neglect certain maintenance requirements and as a result might put pressure to force tenants to move out. And then once the tenants move out, they can see the control allows them to then increase the rents to whatever they want because they've now forced a tenant that was protected under rent control. And that means that you might have a tenant that might be residing, been residing the building for maybe 15, 20 years and their rent might be below $1,000 in today's climate. That's very good. That's not good in terms of a corporation's bottom line because that unit isn't operating at its full potential to deliver the types of returns that it can if you make certain investments then into the property. So some of these landlords would then go into the unit and make certain renovations. They might remove some of the old appliances, change the cabinetry in the units. They might change the layout to provide one with a condo style living. And these investments are typically made to attract more affluent and higher income renters to the properties. So basically you end up with people forced out from their communities? Yes. Can we talk about who are the investors? Like we have these big corporations and big developers, but they don't do it on their own. Who are their investors? Who puts money into these big organizations? I think that's one of the part of the work that we wanted to uncover who these actors are. A lot of these landlords, they might create a company in order to transact for this property, but there's an actual parent company. They might use a numbered company which obscures who the true owner is of the property. But what it also does, it obscures also who might be their investors. So I could speak of many other institutions, but one of the biggest institutional investors in multifamily housing, interestingly, is a federal crown corporation which is PSP, the public service pension, which interestingly manages the pension of members of parliament, manages the pension of federal employees, including Supreme Court judges, military officers, and RCMP officers. And this particular company is one of Starlight Investments largest investor. They essentially became a joint partner in terms of ownership of multifamily properties. So public pension funds by many of our Canadian public servants are involved in the biggest investors of the biggest developments. Property owners in our major cities. You mentioned some pretty well paid people in there. You said Supreme Court judges, you said MPs. Yes. But do you think they're aware of their pension funds being spent in this way? This is a very good question because I don't think a lot of folks are aware of how their pensions is invested. And part of the difficulty is a lot of folks just they invest in their pension and they just want to know when it's time for them to retire that they can be paid out in terms of their pension. So a lot of folks don't actually think about how this money is made. And so what's ironic about that is that you could be paying into a pension that can be actively working to displace you or exacerbate the affordability problems in your own home. That's the ironic part. There's a movement, right, for ethical pension funds, ethical funds, etc. And I think what I've heard is make sure it's not investing. It's an environmental perspective, right? But I think there's obviously we need to expand that definition of ethical funds. In the 90s, we're going back to the beginning for a minute now. In the 90s, government leaders decided, let's turn this over to the promise of the free market. And while we see how that's turned out, it's not turned out so great. The free market means that people are using housing as a commodity and not as human right. So now that we know this, what should government responsibility look like? I think that the government has a responsibility to get back into the housing business. It hasn't done what it's promised to do to address the housing needs of all Canadians and not just the housing needs of Canadians at the top end of the market. Because if businesses have a legal requirement to maximize their returns and everybody's so focused at the top end of the market to try to get all the top-end renters to allow them to deliver those lucrative returns to their unit holders, shareholders, and investors, then who is focusing on folks in the middle of the market or on folks at the lower end of the market? And I think that's the question that continues to be asked is that why isn't that the government not stepping in and getting back into the housing business in where we were building tens of thousands of rental units annually during the 60s and during the 70s? And all of a sudden we were convinced that the private sector was better suited and more uniquely positioned to address these housing needs and also better suited to maintain the stock. But I think the part that gets missed a lot is that when folks are making investment into these properties to improve the quality of living or to extend the life of the asset itself, it's not a philanthropic endeavor. It's an investment that is being made in order to deliver some sort of return. It's being made in order to allow the landlords to command higher rents because they're providing much higher quality in terms of living to folks. But if we're all just focusing in trying to appeal to that higher end of the market, then someone needs to step in to address the housing needs of folks at the other spectrum of the market. And so that means we would need to also regulate how our public pension funds, as you mentioned, are investing to make sure that they're investing ethically and that the idea of ethical investment is broadened to include the human right to housing, that we shouldn't be profiting from the reduction in the supply of affordable housing in the market and that we should be driving to improve the conditions through our investment. A lot of pensions would argue that they are improving the quality of living, but failing to understand ethically, you're improving it for under the premise of it delivering a return to you. So you're expecting a return from your investment. And so it's proper regulations and who gets to invest in the market to ensure that folks aren't profiting from the reduction of the supply of affordable housing. It is also making sure that we're building housing that Canadians can actually afford. So we're not just building housing that is only affordable for a 10 or 15 year period or even a 20 year period, inclusive of a five year phase up period in where this housing returns back to market rent. And we'll be back here 10, 15 years from now, we need to be building housing that is made affordable in perpetuity. We need to be building more non-market housing to compete with the private sector in order to bring costs down. There's this idea that if we increase supply that we're somehow going to help bring affordability in the market. I haven't seen it done anywhere in my lifetime, but I think the private sector has convinced the government in this rudimentary, very simplistic economic argument of supply and demand. We've heard across various news outlets about the rising costs of construction. We've heard about the rising costs of boring, the rising costs of development charges, the rising costs of labor in the market. Developers aren't going to assume all of this costs. Those costs usually gets transferred to the consumer. So if these are rising costs in the industry, how do we expect that if we more that we build that somehow it's going to make the market affordable, if investors need to recoup from their investment that they're making and if costs are so high, that logic just doesn't make sense to me in terms of how we're going. We're not going to build our way out of this crisis by recycling the same playbook of let's find a way to incentivize developers to build more housing that Canadians can't actually afford. We're talking about everyday folks who are living in these kinds of situations. You said you've studied eviction data specifically in neighborhoods in Toronto. I'm wondering who's being affected by these evictions? So what we did was we also studied evictions data. So we acquired evictions data through a freedom of information request through the landlord and tenant board while it's like just under a million records. We were interested in understanding and categorizing these different landlords. And what we found was that financialized landlords accounted for 41% of all the evictions that were filed in the city of Toronto. What we also found was that for financialized landlords, 78% of those eviction filings were for non-payment of rent. That large number would give you the notion that there's a lot of folks out in the city that just don't want to pay their rent. I would actually say that's one of the grave misconceptions that are currently in the current discourse around evictions. It's not necessarily that folks don't want to pay their rent. It's that folks cannot afford the rents that are being charged, especially by these particular types of landlords. We also examined two neighborhoods where we found evictions are very prominent and that would be in the North Albion community, which is in North of Tobico. There's two towers and there's approximately 759 rental units in the property. Starlight acquired the property in 2018 and by 2019, 12 months later Starlight filed 456 evictions in 12 months. That's got to have a massive impact on that community. Massive. Yes and they filed 456 evictions and just to put that into context, so at least 60% of the units received an eviction and that is because these landlords operate in an efficient manner in where you might be short of $20 or $40. You're receiving an evictions notice even for a nominal amount because their process is so streamlined in where it's very automated, in where one becomes short of X that triggers an evictions notice. And so for this property, these two properties between 93 and 95% of those evictions were for non-payment of rent. You know, we're talking about this massive impact on this community and also what types of resistance have you seen to these landlords? So tenants aren't really doing well with this and it's creating a lot of stress in the household and it's leaving folks feeling in some cases trapped. You know, concepts such as displacement or gentrification, I don't necessarily have the utility to capture the gravity of this sort of financial violence that's happening in these particular communities. And I bore a term used by one of my intellectual mentors, a geographer Ananya Roy who's a professor at UCLA and she would call this more of a banishment, an expulsion that is happening. And why I say this is more of a racial banishment that's happening in these communities. One, the community I was highlighting is a community that is over 70% black. And when you think about concepts such as displacement gives this idea that if I get evicted from this one unit or this one building that I can move down the street or across the street to the other landlord, who might be better, the difficulty is what we're seeing in the market is a proliferation of these sort of landlords and they're all engaged in the same practices. You might be thinking that if I leave this one property and go to the next that a situation is going to be better, they're all doing the same thing. The worry that I have is this creation of an oligopolistic rental market in where you have a market that is dominated by three different players or three different landlords who are all engaged in the same practices and are all engaged in trying to maximize their return for their investment. The concern is that the greater the proliferation of these landlords that we're creating more income polarized cities where only the wealthy can afford or only the highest bidder can afford to live in cities like Toronto. You're having folks that are not only being black and other racialized renters that are not only being pushed out to the peripheries of the city, but they're actually even being pushed out not just to the peripheries or the margins. What do you mean by that? It's fracturing communities and what it's doing is it's dispossessing folks of their homes and I think part of the big issue that I have is that we're so focused on the displacement of residents but what's also being lost is a history, a culture that has been in these communities for decades and what's being lost as well is even the mutual aid that a lot of these folks relied on in the face of urban and social policies that have vastly neglected these neighborhoods and as a result mutual aid has stepped in to help in terms of providing them with a healthy life in terms of having access to community gardens or having access to community childcare for folks who might not be able to afford childcare in a more professional setting. The difficulty that we're seeing is that Toronto is losing some of its key contributors that have contributed to the fabric of this city that has made their communities and the city so vibrant and at the expense of these landlords trying to maximize their profits and their bottom lines and I think the last part that I think that doesn't get talked about a lot is the impacts of this on children. We often talk about these impacts on the adults in the household but we never think about how does this impact a child's scholastic performance in school? How does housing insecurity lead to behavioral problems that necessarily might get sometimes even misdiagnosed as a learning disorder because we are not understanding the full picture of how our students arrive in the classroom and what are the contexts that they find themselves in that might potentially be contributing to the issues that they might have in their schooling. What kinds of resistance have you seen by renters, by folks in these communities? One of the things that I've seen in terms of the resistance, they have been the recent rent strikes in the former town of Weston that would be at the properties owned by Dream Unlimited which is primarily an industrial real estate investment trust. They've also entered into the multifamily residential space within the last five years or so. The provincial guideline rental increase for next year is 2.5% and so what's happened is AGI's are being used as a revenue generating tool for landlords to circumvent rent control because this allows them to increase the rents beyond what the province allows annually. So three companies that have applied for the most being Starlight Investment which is applied for approximately just over 250 applications in the last 12 years to increase rents, CapReak being number two at I believe just over 110 and interestingly I believe number three or they're within the top five is a company called BCIMC which is the real estate arm of the BC Public Pension Fund which manages the pension of provincial employees of the British Columbia including employees of the University of Victoria and the University of British Columbia and these entities are invested as well in multifamily properties and so these tenants so they're engaged in a rent strike and what these rent strikes I think enable these landlords to understand the power in the collective in where you have hundreds of folks you're refusing to pay their rents in order to demand livable conditions to demand the removal of excessive rental increases but to be actually be treated as humans the decency the dignity these rent strikes I think are effective in terms of you know bringing landlords to the table to maybe negotiate or rethink their strategies and maybe rethink about where they might invest or to think about their faces behind these numbers that you are speaking about in boardrooms and in debating on how you're going to find even greater efficiency to increase or bolster your bottom line and I think these tenant unions are doing a tremendous job in putting pressure on these landlords and disrupting those profit strategies because at the end of the day these folks they all they want is a decent place to call home and they want to remain in their communities which they've called home for years and where they've established roots in these communities and they want the next generation to be able to have that opportunity as well to do so thank you so much for all of your time today thank you for having me that's it for this episode of don't call me resilient I loved my conversation with Professor Nimoy Lewis he has a wealth of information on housing to find out more about his research check out our show notes on the conversation dot com and if you want to send me a note you can find me on twitter now called x at right venita that's w-r-i-t-e-v-i-n-i-t-a we're also on instagram at don't call me resilient podcast don't forget to take a moment to follow us so you don't miss an episode and especially if you enjoyed this episode please rate the podcast and leave us a review don't call me resilient is hosted by me venita Srivastava the lead producer on this episode is atika kaki sound design and mixing by rematula shake kikachi meme is assistant producer our fabulous consulting producer is jennifer morose and scott white is the ceo of the conversation canada and if you're wondering who wrote and performed the music we use on the pod that's zaki ibrahim the track is called something in the water thanks for listening everyone and hope you join us again next week