Last week, Arizona Attorney General Kris Mayes sent a letter to U.S. Attorney General Pam Bondi urging her to continue the Department of Justice’s antitrust lawsuit against RealPage and several major corporate landlords for alleged collusion to illegally inflate rents.

Mayes, who filed a separate suit against the Richardson, Texas-based company and nine landlords last year, said that protecting renters from “price gouging and market manipulation” should be a bipartisan priority. Mayes said that housing affordability is one of the most pressing issues facing Americans, and it demands action from every level of government.

“I intend to press forward with the case I filed in Arizona against Real Page, but I also urge the Trump administration, through the DOJ, to see its case through. RealPage and its co-conspirators engaged in unfair and anticompetitive practices that forced families to pay artificially high rents at a time when many are struggling to get by,” Mayes said. “Addressing this issue is essential to making housing more affordable — not just in Arizona, but across the country.”

Mayes said that rents are 76% higher in Phoenix since 2016 and 30% higher in Tucson over the past few years.

“These increases aren’t simply a result of supply and demand — they are the product of deliberate, illegal actions that manipulated the rental market,” Mayes wrote. “Rather than competing, these landlords allegedly coordinated to artificially inflate rents using RealPage’s so-called ‘revenue management’ software.”

New administration

The Biden administration had been focused on cracking down on what it saw as anti-competitive activity in several sectors, targeting multifamily, hotels and other industries. However, there are questions about whether the Trump administration will continue with this practice.

In December, RealPage Outside Counsel Stephen Weissman, global co-chair of law firm Gibson Dunn’s Antitrust and Competition Practice Group, told reporters it’s “hard to predict” what will happen with the new administration’s stance on antitrust issues. “We’re hopeful, obviously, that this administration or the future administration will appreciate the pro-competitive virtues of our product,” he said.

In the waning days of the Biden administration in January, the Justice Department and attorneys general from 10 states filed an amended complaint in their antitrust lawsuit against RealPage to sue six landlords for allegedly “participating in algorithmic pricing schemes that harmed renters,” according to a press release from the DOJ.

The complaint alleges the landlords participated in a scheme to decrease competition in apartment pricing. They are:

• Charleston, South Carolina-based Greystar Real Estate Partners.
• Blackstone’s Chicago-based LivCor.
• Houston-based Camden Property Trust.
• Chicago-based Cushman & Wakefield and its subsidiary Pinnacle Property Management Services.
• Dallas-based Willow Bridge Property Co.
• Atlanta-based Cortland Management.

Mayes, for one, thinks this suit needs to continue, arguing that “millions of renters” have been hurt by RealPage’s actions.

“This scheme stifled competition, created a de facto rental monopoly, and drove up housing costs for working families,” Mayes said. “That’s why my office sued nine corporate landlords and RealPage for price-fixing in Arizona. But this is a national crisis, which is why the DOJ and 10 other states also took legal action.” 

RealPage response

In December, lawyers for RealPage asked that the U.S. District Court for the Middle District of North Carolina dismiss the antitrust lawsuit brought against it by the Department of Justice and 10 states. The court has yet to rule on that request.

RealPage said in the filing that the DOJ’s complaint lacks factual allegations that the company’s conduct caused anticompetitive effects in any alleged relevant market because its software doesn’t have the power to raise rents above the competitive level. To do that, 30% or 40% of the units in a market would need to use the company’s AI Revenue Management or YieldStar software programs. The plaintiffs aren’t challenging the company’s Lease Rent Options product. 

“DOJ has not been able, despite conclusions and labels, to articulate a theory of facts that shows anticompetitive effects, such as higher prices than a competitive market would sustain,” Weissman said on a call with reporters last year.

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