Dive Brief:
- Dozens of property management firms, including the country’s largest landlord, Greystar, have agreed to resolve a 2023 class-action lawsuit alleging that they conspired with rivals to inflate rental prices using algorithms offered by software company RealPage, according to recently filed court documents.
- Prominent property management companies that agreed to settle include Denver-based Simpson Property Group; Avenue5 of Seattle; Greensboro, North Carolina-based Bell Partners; Washington, D.C.-headquartered Bozzuto; Pinnacle of Glen Burnie, Maryland; and Boston-based Winn.
- Plaintiffs have reached 26 class settlements worth more than $141.8 million combined, according to preliminary class-action settlements filed Oct. 1 in the U.S. District Court, Middle District of Tennessee - Nashville Division. The deal still requires a judge’s approval. Greystar will pay the largest amount at $50 million.
Dive Insight:
The group of renters that brought the suit alleges that property managers shared confidential business information with Richardson, Texas-based RealPage and coordinated to raise rent pricing in violation of antitrust law. In addition to RealPage, several defendants remain, including Equity Residential and Brookfield Management.
Charleston, South Carolina-based Greystar and other settling companies deny wrongdoing.
“The settlements do not include admission of wrongdoing and allow us to move forward and remain focused on serving our residents and clients,” a Greystar spokesperson said in an email to Multifamily Dive.
The companies also agreed to stop sharing nonpublic information with RealPage for its rent-setting algorithm. That’s a key concession, since plaintiffs allege that data enables landlords to align their prices and inflate rents.
“Settling Defendants have agreed not to provide nonpublic data to RealPage for use in competitor pricing recommendations and to refrain from using RealPage’s RMS that relies on non-public competitor data to make pricing recommendations,” attorneys wrote in the settlement filing. “This represents a fundamental shift in the multifamily housing industry and will help reverse the type of anticompetitive coordination alleged in the Complaint.”
In addition, the companies also agreed to settlements ranging from $550,000 to Greystar’s $50 million payment.
RealPage and other property managers are also fighting an antitrust lawsuit filed in 2024 by the Department of Justice and several state attorneys general. Greystar reached a settlement in that case in August.
RealPage recently settled a lawsuit with the State of Nevada, which alleged its rent-setting software cut into competition and harmed Nevada tenants. Similarly, the software provider agreed to rules and limitations on its use of non-public rental information.
For its part, the company does not anticipate needing to make any changes to its revenue management software for customers to continue using the products pursuant to any terms in these settlements, RealPage spokesperson Jessica Bowcock said in an email.
“While the proposed settlements announced last week do not include RealPage, we are encouraged to see this matter move toward closure. RealPage continues to believe that this litigation is without merit and that our revenue management products, and our customers’ use of them, have always been legal,” Bowcock said.
