Washington, D.C. Attorney General Brian L. Schwalb has announced that JBG Associates, L.L.C. (JBG Smith) and Mid-America Apartments (MAA) will pay a total of $9.3 million to settle allegations of rent price fixing and change their business practices as part of separate settlement agreements
The agreements resolve the antitrust lawsuit alleging that the companies had illegally conspired with other landlords, using RealPage, Inc.’s pricing software, to inflate rents at thousands of apartments across the District. In DC, JBG Smith owns over 4,500 units and MAA owns 269 units.
Under the terms of these two recent and separate settlement agreements, JBG Smith and MAA will pay $9.3 million in civil penalties, money to impacted residents, and legal fees. JBG Smith will pay $8.1 million. MAA will pay $1.2 million.
“District residents face severe housing affordability challenges, and yet some of the largest residential landlords made things worse by illegally colluding to artificially push rents even higher,” said Schwalb. “My office will continue to use the law to make sure that DC’s housing market is fair and competitive, that law-abiding landlords can compete on a level playing field, and that DC residents who want to live in the District can afford to live here.”
RealPage offers a variety of technology-based services to real estate owners and property managers, including revenue management (RM) products that rely on non-public, competitively sensitive pricing data that RealPage receives from the owners and managers. RealPage leverages this confidential data to estimate supply and demand for multifamily housing that is specific to particular geographic areas and unit types and then generates an inflated rental price.
In the District, well over 30% of apartments in multifamily buildings (i.e., buildings with five or more units), and approximately 60% of units in large multifamily buildings (with 50+ units), have been priced using RealPage’s RM software. This leaves many District residents with no choice but to pay inflated rents.
The office of the attorney general for Washington, D.C. “alleged that JBG Smith used RealPage’s RM software to set rents for multiple properties in the District, and MAA used RealPage’s RM software to set rents for one DC property. As a part of RealPage’s price-fixing cartel, OAG alleges that JBG Smith, MAA, and 12 other defendant landlords illegally coordinated to share sensitive, non-public company data, avoiding direct competition and delegating rent-setting authority to RealPage,” the release says.
