BARCELONA, Spain — Ana María Banegas lives on a sun-drenched street in central Barcelona, a short walk from where her children go to school. Outside, a doormat welcomes visitors: “Home Sweet Home.”
But this is where the domestic idyll ends. The building’s owner isn’t your typical landlord, she says, but rather a private equity firm thousands of miles away. And Ms. Banegas is no typical tenant: Along with a dozen other families who have been struggling financially during the pandemic, she has occupied the building since April and now refuses to leave.
“This property belongs to Cerberus,” said Ms. Banegas, referring to Cerberus Capital Management, a private equity firm based in New York. “And from this home, we aim to pressure them.”
Her protest is part of a battle that is being waged in the courtrooms, living rooms and streets of Barcelona, pitting foreign investment firms that have bought up thousands of homes across Spain over the past decade against residents and activists who are using a novel strategy to try to stop them from evicting renters who have fallen behind.
On one side is Cerberus, which, along with other giant investment firms like Blackstone and Lone Star, has been snapping up properties across Spain at bargain prices since the global financial crisis that began in 2008. The firms then put them up for rent at a time when the country’s economy was on a stronger footing.
But the pandemic pushed the Spanish unemployment rate up to 15 percent and evictions nationwide spiked in the first half of 2021. The investment firm landlords sent out a slew of eviction notices to tenants across the country or canceled leases for those who fell behind on the rent, residents said.
In the streets of Barcelona, a group called War Against Cerberus decided to fight back.
When lawyers of private equity firms come with police officers to force residents from their homes, members of the group — some of them longtime housing activists — surround the building to block their entry. As residents are pushed out of apartments, the group sends squatters to occupy properties owned by the firms elsewhere in the city — sometimes breaking in to gain entry.
The activists even took over the offices of a Cerberus real estate servicer in Barcelona for a time last year.
According to War Against Cerberus, dozens of families have occupied buildings owned by private equity firms in Barcelona, which has long been a target of outside investors. That can translate into years of courtroom hearings and millions of dollars in legal fees to remove the squatters.
Miquel Hernández, a spokesman for War Against Cerberus who helped Ms. Banegas find the home where she is squatting, accused the private equity firms of profiting from the economic distress caused by the pandemic.
“They’re treating them like any other asset,” he said, referring to the homes owned by the firms.
The problem has caught the attention of Spain’s national government, led by a left-wing coalition. It has proposed the imposition of rent controls on investment funds and other large landlords.
The proposed legislation, supported by Barcelona’s mayor, Ada Colau, would allow for rent caps for owners with more than 10 properties in areas where rent increases have outpaced inflation.
“We have to civilize a market that has gotten out of control,” said Ms. Colau, a former housing activist who rose to power with an organization that fought against foreclosures. “A problem that was bad before the pandemic has suddenly gotten worse.”
She attributed much of the increase in evictions to investment firms that refused to negotiate agreements with renters who fall behind, choosing instead to force them out and find others who can pay.
Spain imposed a partial moratorium on evictions for much of the pandemic, but only for those in “vulnerable situations,” such as single parents. In cases that went to the courts, the judiciary was seen as siding largely with the landlords.
Cerberus said it was committed to treating every resident with dignity and respect and to following the law.
“We believe it is the responsibility of all corporate citizens to not only respect the dignity of everyone but also appropriately address illegal activity that can harm communities,” a company spokesman said in a statement to The New York Times.
The Association of Rental Housing Owners, a Spanish group which includes some of the outside investment firms, took aim at the proposed housing law, saying that rent controls would only discourage owners from building new rental units during a time of low supply.
The conflict in Barcelona traces its roots to the financial crisis that started in 2008. That downturn hit homeowners hardest, driving many of them, as well as the banks that owned their mortgages, into bankruptcy. The crisis also fueled evictions and the rise of a protest movement to defend homeowners against predatory loans.
But thousands lost their homes anyway and many of them became renters. And in the current crisis, it is renters who have suffered the brunt of the damage, activists say.
As defaults became common and credit harder to come by, the number of renters in the country grew by more than 40 percent over the last decade. At the same time, private firms amassed at least 40,000 properties in Spain, according to estimates by economists and the Spanish news media.
Even so, homeownership has remained relatively high in Spain, at about 75 percent.
In one case in 2013, Blackstone, now thought to be Spain’s biggest landlord, bought more than 1,800 apartments from the Madrid city government, which was low on cash.
But those types of acquisitions did not cause a stir until the pandemic left the firms, like many other landlords, serving up eviction notices for those who could not make the rent.
In the first quarter of 2021, evictions of renters in Spain rose by 14 percent compared with the same period the previous year, according to the government. By the second quarter of this year, they surged to eight times as many as in the same period in 2020.
One complaint about private equity landlords is that being based abroad, they are difficult to reach to negotiate settlements, unlike local landlords.
Irma Vite, a 47-year-old immigrant from Ecuador, first received a notice in 2019 that the lease for her rental apartment would not be renewed by Divarian, a Cerberus-owned real estate company in Spain. She has spent the entire pandemic fighting in courts to remain in the home.
Her story offers a window into the unregulated world of Spanish housing which allowed private equity companies to become such dominant landlords here. She bought the apartment in 2005 for 216,000 euros, or about $267,000 at the time, with no down payment, from a local Spanish bank. Her monthly mortgage payments were €900.
The mortgage had a fluctuating interest rate, however, and by 2009, her payments had risen to €1,200. By 2015, she could no longer afford the payments and she entered foreclosure proceedings with the bank, which allowed her to remain in the home as a renter.
But that bank, Caixa Catalunya, was barely solvent itself. In 2016, it merged with the Spanish giant BBVA, which extended her rental agreement until 2019.
In October 2019, she received a letter from Divarian, the Cerberus company, saying that it now owned the property and would no longer rent to her. Ms. Vite sought help from the War Against Cerberus and has spent the last two years refusing to leave her home.
Cases like hers are becoming more common and have provided War Against Cerberus opportunities to flex its muscles. In October, the group got word of five evictions that were scheduled in L’Hospitalet de Llobregat, a town on the outskirts of Barcelona.
When a lawyer representing the firm that owned the apartments arrived with the police, they were met by about 50 activists who surrounded the building. A crowd of residents soon arrived, chanting for the officers to leave.
“You’re vultures,” one of the protesters yelled.
The police backed down, saying that they would give the owners an extension before their eviction.
War Against Cerberus is also trying to play offense against private equity firms by sending residents like Ms. Banegas to occupy apartments that the firms own in Barcelona. Mr. Hernández, the activist spokesman, said that the group’s goal was to eventually pressure Cerberus into agreeing to allow the squatters to remain and pay reasonable monthly rents.
Ms. Vite said she would much rather go back to paying rent than keep squatting. But so far, Cerberus has refused to make an agreement with her and has asked a court to evict her.
An auxiliary nurse at a nearby hospital, Ms. Vite said that she recently came across a man suffering from depression who was also being forced out of his home after not being able to pay the rent, and that they had briefly commiserated.
“I was there as the nurse, he as my patient, and I was just thinking, ‘Look at what’s at the root of all of these problems,’” she said.
Samuel Aranda contributed reporting.