Greystar has struck a deal to slip out of the group of landlords accused in a massive rent collusion case.
The South Carolina-based operator agreed to pay $7 million as part of a settlement with nine states, Bisnow reported. The landlord is also accepting limits on the data it uses to price its massive portfolio to resolve claims from the nine attorneys general.
The settlement would remove the company from the states’ antitrust suit targeting RealPage’s revenue-management software and the landlord consortium accused of using it to coordinate pricing. The deal still needs court approval and includes no admission of wrongdoing.
State prosecutors allege RealPage’s artificial intelligence-powered platform — formerly YieldStar — became a shadow hub for landlords to share competitively sensitive data and nudge each other toward higher rents. A ProPublica report sparked the investigation, which evolved into a two-year federal probe followed by a wave of litigation.
Greystar, which owns or manages more than 900,000 units nationwide, already agreed to cooperate with the DOJ in the federal case.
Under the multistate settlement, Greystar would be barred from using, soliciting or sharing nonpublic information when setting rents. That covers anything that could signal supply, demand or pricing strategy, including occupancy levels, executed rents, concession data or another landlord’s revenue-management settings.
The line between public and proprietary information is spelled out bluntly: if it’s online, it’s fair game, but Greystar cannot ask competitors for details.
California would receive the $7 million payment and the nine states would determine how to divide the proceeds amongst the group, which includes North Carolina, Colorado, Connecticut, Illinois, Minnesota, Oregon, Tennessee and Massachusetts.
The deal also installs an antitrust compliance officer and runs for five years with an option to extend if violations surface. If approved, claims against Greystar would be dismissed with prejudice, taking future lawsuits for the same alleged actions off the table.
RealPage, which declined to comment on a co-defendant’s settlement, has insisted the lawsuits and pending legislation are political theater in an affordability crisis.
Meanwhile, a parallel class-action case in Nashville continues: Greystar and 26 other operators agreed to settle and Greystar agreed to pay $50 million, though AGs have urged the judge to reject those deals, arguing the penalties barely dent the alleged harm to tenants.
— Holden Walter-Warner
Read more
Dozens of property owners, managers settle rent-fixing case
Greystar settles DOJ rent algorithm probe
RealPage taps Dirk Wakeham as CEO in leadership shakeup