Dive Brief:
- A former tenant of an apartment property owned by Apartment Income REIT Corp. has filed a class action lawsuit against the company, with a request for a jury trial, alleging that funds had illegally been deducted from his security deposit when he moved out.
- The plaintiff, Killian Coleman, was a resident of Royal Crest Estates North Andover in North Andover, Massachusetts, one of nine properties AIR owns in the state. After he vacated the unit in June 2023, Coleman received two sworn statements — a move-out statement and an inspection report — which included a bill for $3,136.21 against his $500 security deposit.
- The plaintiff alleges the documents were not signed and did not provide adequate documentation of the costs and work required to repair his unit. The bill also deducted a cleaning fee, and included charges that were not noted on the unit inspection report. All of these are considered violations of the Massachusetts Security Deposit Law, according to the suit, which was filed at the end of May.
Dive Insight:
Parties to Coleman’s case are divided into three classes based on the nature of the violation, according to the suit. They include any former tenant of an AIR-owned or -operated property in Massachusetts between April 26, 2020, and the date of the final judgment in the suit who:
- Had portions of their security deposit retained for cleaning fees.
- Did not receive itemized lists of damages sworn to under pains and penalties of perjury within 30 days of vacating the unit.
- Did not receive documentation of damages, including estimates, bills, invoices or receipts, within 30 days of vacating the unit.
The number of potential parties in the case is estimated in the hundreds or thousands, as AIR owns over 2,500 apartment units in Massachusetts, according to court documents. The plaintiff states that the number may be confirmed by the defendants’ tenancy records, and that potential parties may be notified of the suit through court-approved methods.
For the cleaning fee and sworn statement classes, the plaintiff seeks injunctive relief to compel AIR to reform its security deposit practices, as well as the return of the parties’ forfeit deposits and other damages. In the damage documentation class, the plaintiff seeks injunctive relief only.
AIR did not respond to Multifamily Dive’s request for comment.
The case was originally filed in the Suffolk County Civil Court on April 26, according to case documents, with a pre-trial meeting scheduled for October. Following a notice of removal from AIR, the case was transferred to the Commonwealth of Massachusetts Superior Court on May 28. Further meetings have not yet been scheduled.
New York City-based asset manager Blackstone announced in April that it is in the process of acquiring AIR. The private equity giant plans to purchase all shares of the REIT’s stock for approximately $10 billion, or $39.12 per share, taking the company private. The acquisition deal is expected to close in the third quarter of 2024.
