Wednesday, January 22, 2025
Corporate landlords that operate in Utah accused of price fixing by federal prosecutors.
Urban Living
Posted By Babs De Lay on January 22, 2025, 4:00 AM
I'm not sure if President Donald Trump intends to keep the Department of Justice as part of government. But after going through investigations in and out of office, he certainly wants to punish many affiliated with the DOJ.
Two weeks ago, Special Counsel Jack Smith said that, basically, if Trump hadn't been re-elected he would have been found guilty of trying to influence the 2020 election. The DOJ enforces federal laws, works to prevent crime and terrorism, promotes national security and protects consumers by ensuring healthy business competition.
The latest bombshell out of the DOJ (in cooperation with several state attorneys general as co-plaintiffs) is a case against several of the largest corporate landlords in the country, accusing them of "participating in algorithmic pricing schemes that harmed renters." The complaint alleges landlords—Greystar Real Estate Partners, Blackstone's LivCor, Camden Property Trust, Cushman & Wakefield Inc./Pinnacle Property Management Services, Willow Bridge Property Company, RealPage, Inc., and Cortland Management—all participated in a scheme to decrease competition among landlords in apartment pricing, harming millions of American renters. Together, these landlords operate more than 1.3 million units in 43 states and the District of Columbia.
At the same time, the Justice Department filed a proposed consent decree with Cortland that requires it to cooperate with the government, stop using its competitors' sensitive data to set rents and stop using the same algorithm as its competitors without a corporate monitor.
The complaint alleges corporate landlords worked with competitors about rents, occupancy and other sensitive topics and future pricing plans that included planned price increases through "call arounds," which they nicknamed "market surveys."
For instance, landlords discussed, via user groups, how to modify the software's pricing methodology, as well as their own pricing strategies. In one example, executives from two companies worked with another as to their plans for renewal increases, concessions and acceptance rates of rent recommendations
Sharing information with competitors to increase prices is a big no-no and can be considered "price fixing." You simply can't use competitors' data to run your models. Soliciting, disclosing or using any competitively sensitive information with any other property manager as part of setting rental prices or generating rental pricing recommendations only hurts renters and helps landlords/owners/investors.
Cortland manages more than 80,000 rental units in 13 states. Imagine the impact that one company has on renters and rent rates! Many of the firms under investigation operate apartment buildings in Utah—in Salt Lake City, Ogden-Clearfield and Provo-Orem and from St. George to Park City at the Canyons Village.
About The Author
Babs De Lay
A full-time broker/owner of Urban Utah Homes and Estates, Babs De Lay serves on the Salt Lake City Historic Landmark Commission. A writer and golfer, you'll find them working as a staff guardian at the Temple at Burning Man each year.
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