Tenants are suing Richardson-based RealPage and some of the nation’s largest property management firms, forming what they call a “cartel” to force apartment prices to be artificially competitive. I’m suing for raising it above a certain level.
Five tenants are suing RealPage and seven property management companies, including Dallas-based Lincoln Property Co. ProPublica publishes survey On Landlords Using RealPage’s Proprietary YieldStar Algorithm To Push The Highest Possible Rents For Apartment Tenants Across The U.S.
RealPage spokeswoman Natalie Dent said: “We will not comment further on pending lawsuits.”
In response to ProPublica earlier this week, RealPage said: dallas morning news: “Revenue management software fails to control the market due to lack of consideration of market availability or visibility. has declined steadily over the past decade, suggesting increased vacancies and resident turnover due to revenue management.”
A class action lawsuit was filed in the United States District Court for the Southern District of California on behalf of all lessees in multifamily real estate leases from landlords who used RealPage’s pricing or lease renewal software.
“Today’s lawsuit plausibly alleges that rental unit renters are working together to raise rents to unprecedented levels, exacerbating the nation’s affordable housing crisis,” said Rent. “We look forward to establishing our client’s rights in this important federal antitrust lawsuit,” said Gary Smith Jr., an attorney representing Hausfeld.
The lawsuit alleges that until about 2016, landlords independently priced their leases based on their own assessments of how best to compete with other landlords. Around 2016, he agreed to use his RealPage, a common third party that collects real-time prices and supply levels and uses that data. To make pricing and supply recommendations. Landlords will follow RealPage’s proposal in the hope that others will do the same, the lawsuit said.
The lawsuit targets some of the nation’s largest multi-dwelling managers, including Greystar Real Estate Partners LLC, headquartered in Charleston, South Carolina. Lincoln Properties, Inc., based in Dallas. FPI Management Inc. based near Sacramento. Mid-America Apartment Communities Inc. is based in the Memphis area. Equity housing based in Chicago. Essex Property Trust is headquartered in the San Francisco Bay Area. Three Seattle-based companies: Avenue5 Residential LLC, Thrive Communities Management LLC, and Security Properties Inc.
No companies responded immediately to requests for comment.
The plaintiffs listed are Shelley Bason, Lois Wynn, George Emmanuel Njon Diboke, and Julia Sims, who are current and former residents of properties managed by Greystar in California and Washington. , Sophia Woodland, is a resident of an Everett, Washington estate operated by Security. properties.
The lawsuit alleges that RealPage collected confidential and non-public data from participating landlords and used it to recommend prices to other operators.
“RealPage advertises that it sets the price. [landlords’] “Properties as if we owned them”—i.e. participating [landlords’] Cartels replicate the market outcomes observed when they are the monopoly of the cartel’s goal of leasing a home,” the lawsuit states.
According to the lawsuit, RealPage says landlords must accept the suggested price at least 80% of the time to most effectively increase rents. RealPage’s main architect, Jeffrey Roper, is quoted in a ProPublica article and lawsuit as saying, “When there are idiots who underestimate, it costs the whole system.”
The lawsuit cited RealPage employees who said landlords would take 80% to 90% of the price without deviating.
“As one [landlord] “We are all technically competitors, but RealPage helps us work together,” says the lawsuit. said.
The lawsuit also alleges that landlords used RealPage services to adjust supply levels and avoid price competition. RealPage has informed landlords, saying it helps to oversupply the market as a whole, “stagger” rental renewals to keep prices high, and keep vacant rooms vacant for a period of time. .
of North Texas real estate management technology leader has a presence in 22 million apartments worldwide. RealPage became the nation’s leading provider of rent-setting software for landlords after a controversial 2017 merger with rival Lease Rent Options, according to a ProPublica study.
The company sells software and operating systems and provides analytics to the rental industry. He grew through a series of acquisitions before one of the world’s largest private equity firms, San Francisco-based private equity firm Thoma Bravo. Acquisition of the company for $10.2 billion in 2021 It made RealPage private.