Dive Brief:
- Mid-America Apartments and JBG Associates have agreed to pay $9.3 million total and change certain business practices to resolve allegations that they conspired with other landlords, using RealPage’s pricing software, to inflate rents in Washington, D.C., according to a Monday press release from the D.C. Attorney General’s office.
- MAA and JBG Associates, which operates as JBG Smith, will pay $1.2 million and $8.1 million, respectively, in civil penalties, legal fees and money to impacted residents, according to the consent judgments filed last week in the Superior Court of the District of Columbia, Civil Division. JBG Smith owns more than 4,500 apartments in D.C. while MAA owns 269 local units, per the release.
- D.C. Attorney General Brian Schwalb alleges that JBG Smith, MAA and 12 other defendant landlords illegally shared non-public housing data, thereby avoiding direct competition. Multifamily Dive reached out to MAA and JBG Smith for comment but did not receive a response by publication time.
Dive Insight:
MAA and JBG’s settlements are the latest developments in the lawsuit that the D.C. attorney general’s office filed in 2023 against software provider RealPage and 14 landlords, accusing them of “unlawfully agreeing to exchange competitively sensitive data in violation of the District of Columbia Antitrust Act.”
Using RealPage’s revenue management system, landlords inflated rent prices in thousands of apartments in D.C., causing renters to pay millions of dollars more than they otherwise would have, according to the lawsuit.
W.C. Smith settled at the end of May for just over $1 million in civil penalties, money to impacted residents and legal fees. Avenue5 Residential and Bell Partners settled in June, agreeing to each pay $700,000 and stop using revenue management software that relies on confidential data to set rents.
In addition to financial penalties, Germantown, Tennessee-headquartered MAA and Bethesda, Maryland-based JBG agreed to:
- Not use revenue management software that relies on non-public or confidential data from other companies.
- Refrain from promoting or encouraging the use of revenue management software and accepting recommended rent prices.
- Stop sharing non-public data with other landlords that can be used to collude.
- Accept an independent monitor, at the company’s expense, if OAG learns that JBG Smith or MAA may not be complying with the settlement terms.
In D.C., more than 30% of apartments in multifamily buildings — those with five or more units — and approximately 60% of units in large multifamily buildings, with 50 or more units, have been priced using RealPage’s RM software, per the release, and “this leaves many District residents with no choice but to pay inflated rents.”
Schwalb said that his office will continue to ensure that the district’s housing market is fair and competitive and that “law-abiding landlords can compete on a level playing field.”
“District residents face severe housing affordability challenges, and yet some of the largest residential landlords made things worse by illegally colluding to artificially push rents even higher,” Schwalb said in the release.
Separately, Schwalb also sued MAA at the end of April for allegedly charging junk fees and hiding the true cost of rent from prospective tenants.
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