Blackstone Wins Big State Housing Contract as Government Calls It a 'Vulture Fund'
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The American investment company Blackstone has won a large new contract with the Spanish state to manage public housing. At the same time, the Spanish government has publicly placed Blackstone among so-called "vulture funds."
A vulture fund is a company that buys assets very cheaply and later sells them for much higher profit. The government's comments highlight a contradiction: giving new work to a company it criticises.
The story connects to events from 2013, when Madrid's then-mayor, Ana Botella, sold 1,860 public homes to a vulture fund. Critics say the homes were sold at a very low price, far below their real value.
That same year, Madrid sold a much larger group of public flats: 4,795 in total. These homes went to several large investment funds, including Goldman Sachs and Blackstone. Many of the flats still had tenants living inside them at the time of the sale.
Years later, Madrid faces a shortage of social housing. Many observers link today's lack of affordable public homes directly to these sales. The homes that were once public, and often rented cheaply, became part of private investment portfolios instead.
The new Blackstone contract has reopened debate about the role of large international funds in Spain's housing market. Supporters of such deals argue that private companies can manage housing more efficiently. Critics argue that selling public assets to profit-focused funds removes affordable homes from the market permanently.
The government has not announced any plan to cancel or change the new contract, even while continuing to criticise vulture funds publicly.
Vocabulary10 words
- contract
- an official agreement to do paid work
- vulture fund
- a company that buys things cheaply to make large profit later
- social housing
- government homes for people with low income
- tenant
- a person who lives in a home but does not own it
- portfolio
- a group of investments or properties owned by one company
- asset
- something valuable that a person or company owns
- mayor
- the elected leader of a city
- affordable
- cheap enough for most people to pay
- investment company
- a business that buys things to make money
- shortage
- not having enough of something
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Quiz
Answer key
1. The government criticises Blackstone but gave it a new contract 2. They were sold cheaply to a vulture fund 3. True
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Fill-in-the-blank listening
Play the audio again and fill in the missing words as you listen.
Blackstone has won a large new _____ with the Spanish state.
The Spanish government has placed Blackstone among so-called "_____ funds."
A vulture fund buys assets very _____ and sells them for profit.
Ana Botella sold 1,860 public homes to a vulture _____.
Critics say the homes were sold at a very low _____.
Madrid sold 4,795 public _____ in total that year.
Many flats still had _____ living inside them during the sale.
Today Madrid faces a shortage of social _____.
The homes became part of private investment _____.
The government has not announced any plan to _____ the new contract.
Discussion questions
- Why might a government criticise a company but still give it a contract?
- Do you think selling public housing to private investors helps or harms a city?
- What responsibilities should governments have toward tenants during property sales?
- How can cities prevent shortages of affordable housing in the future?
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