DOJ sues major landlords, including Cortland in Atlanta, for price fixing
ATLANTA - The U.S. Department of Justice (DOJ), alongside several state attorneys general, has filed an amended antitrust complaint against RealPage and six of the nation’s largest landlords, alleging they participated in a scheme to inflate rents using algorithmic pricing tools. The lawsuit claims these actions harmed millions of renters by reducing competition in the rental housing market.
Co-plaintiffs in the case are the Attorneys General of California, Colorado, Connecticut, Illinois, Massachusetts, Minnesota, North Carolina, Oregon, Tennessee and Washington.
Landlords Accused of Collusion
The landlords named in the complaint are:
- Greystar Real Estate Partners LLC (Charleston, South Carolina)
- Blackstone’s LivCor LLC (Chicago, Illinois)
- Camden Property Trust (Houston, Texas)
- Cushman & Wakefield Inc. (Chicago, Illinois)
- Willow Bridge Property Company LLC (Dallas, Texas)
- Cortland Management LLC (Atlanta)
Together, these companies manage over 1.3 million rental units across 43 states and Washington, D.C. The lawsuit alleges they used RealPage’s pricing algorithms to share sensitive rent information and coordinate pricing strategies to artificially inflate rental rates.
Unlawful practices
According to the DOJ, the landlords engaged in several unlawful practices to manipulate rental prices.
These included directly communicating with competitors to share sensitive information about pricing strategies, occupancy rates, and renewal rates.
Property managers also participated in "call-arounds," where they exchanged details about rents, discounts, and pricing tactics.
Additionally, landlords attended user group meetings hosted by RealPage, where they discussed modifying algorithms and pricing strategies. They further coordinated by sharing operational details about RealPage’s software to align pricing practices.
Cortland in Atlanta
Cortland Management, which oversees more than 80,000 units across 13 states, has agreed to a proposed consent decree to resolve the claims against it.
Under the agreement, Cortland must cooperate with the DOJ’s investigation and is prohibited from using competitors’ sensitive data in pricing models, employing third-party pricing algorithms without court-appointed oversight, and sharing or soliciting competitive pricing information with other landlords. The decree is now subject to a 60-day public comment period and court approval.
Cortland's headquarters is located in Atlanta and a recent analysis by the White House revealed that Alanta has the highest number of rental properties impacted by price adjustment algorithms.
RELATED: Atlanta leads in rental properties affected by price algorithms, report says
Cortland appears to have approximately 30 properties in metro Atlanta. The majority of the properties are located in Decatur, Buckhead, Brookhaven, Sandy Springs, Brookhaven, Duluth, Dunwoody, Marietta, and Alpharetta.
According to its website, Cortland was founded in 2005 with a "vision to challenge the conventions of the traditional multifamily industry through better living spaces and experiences." The company's website also says that it owned and managed 5,000 apartment homes by 2011 and now has regional offices in Charlotte, Dallas, Denver, Greenwich, Houston, Orlando, and Phoenix.
Cortland provided the following statement to FOX 5 Atlanta:
"Cortland is pleased to announce the US Department of Justice filed a proposed settlement that would resolve the Antitrust Division’s civil investigation into Cortland related to antitrust violations in the multifamily housing industry.
Additionally, last month, the Antitrust Division informed Cortland that it had closed its criminal investigation into pricing practices in the multifamily industry. As a result, Cortland and its employees are no longer subject to the criminal investigation that motivated the Department of Justice’s May 2024 search at Cortland’s headquarters in Atlanta.
We believe we were only able to achieve this result because Cortland has invested years and significant internal resources into developing a proprietary revenue management software tool that does not rely on data from external, non-public sources. The terms of Cortland’s settlement have been agreed to with the Department of Justice and will be filed with the court for its approval. We look forward to putting the federal government’s investigations behind us in 2025, as we continue to seek opportunities to invest in tools and services that will improve resident experience and the success of our managed communities."
In November, Atlanta was ranked as having the 30th most expensive rental market in the country, according to a report by Zumper. Also in November, Zumper said Brookhaven was the most expensive city for apartment rentals in metro Atlanta.
Cities and states fighting back
Several cities are not waiting for lawsuits against RealPage and the landlords to make their way through the legal system.
San Francisco passed a new law in September that "prohibits the sale or use of algorithmic devices to set rents or manage occupancy levels for residential units" in the city.
In October, Philadelphia approved similar legislation.
Legislation is currently working its way through the New Jersey legislature and restrictions have also been proposed in San Diego and San Jose, according to The Markup.
RealPage has built a website to defend its business practices. Their basic defense boils down to that customers "always have 100% discretion to accept or reject software price recommendations."