RealPage Sued by U.S. Justice Department and Eight Attorneys General for Alleged Antitrust Violations
RealPage, a leading property management software provider, is facing a lawsuit filed by the U.S. Justice Department and eight attorneys general for allegedly colluding with apartment and building managers to drive up unit prices across the country.
The Richardson, Texas-based company is accused of engaging in anti-competitive practices by sharing information with rival landlords to train its recommendation algorithms, ultimately stifling competition among property owners who rely on RealPage's pricing recommendations.
This high-profile case marks the DOJ's first major investigation into algorithmic collusion, coming at a time when rent prices in the U.S. have surged by 33% since March 2020, according to Zillow.
Despite being acquired by private equity firm Thoma Bravo for $10.2 billion in 2021, RealPage holds a dominant 80% market share in commercial revenue management software for multi-family housing rentals in the U.S. The company has denied any wrongdoing in response to the allegations.
Analysis:
The lawsuit against RealPage sheds light on the potential impact of anti-competitive behavior in the property management industry, affecting both landlords and tenants. If proven guilty, this case could lead to increased competition in the market, potentially resulting in fairer pricing for rental properties. As an investor or consumer in the real estate sector, it is crucial to stay informed about such legal developments that could influence market dynamics and investment decisions.