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Lawsuits & Litigation

Arizona Attorney General Accuses RealPage, Landlords of Conspiring to “Corrupt” Rental Market

— February 28, 2024

In her lawsuit, Arizona Attorney General Kris Mayes claimed that Arizona landlords colluded with property-management software company RealPage to fix rental prices in the state’s two largest cities.

Arizona Attorney General Kris Mayes has filed a lawsuit against RealPage, claiming that the property-management software company colluded with landlords in an “illegal price-fixing conspiracy.”

According to ABC-15, the complaint names RealPage and nine Phoenix- and Tucson-based landlords as defendants, including Apartment Management Consultants, Greystar Management Services, and HSL Properties.

In a statement, Mayes indicated that allegedly unlawful collaboration between RealPage and landlords has led to increased rents and exacerbated the state’s “affordable housing crisis.”

“The conspiracy allegedly engaged in by RealPage and these landlords has harmed Arizonans and directly contributed to Arizona’s affordable housing crisis,” Mayes said in a press release. “In the last two years, residential rents in Phoenix and Tucson have risen by at least 30% in large part because of this conspiracy that stifled fair competition and essentially established a rental monopoly in our state’s two largest metro areas.”

“RealPage and its co-defendants,” Mayes said, “must be held accountable for their role in the astronomical rent increases forced on Arizonans.”

Tucson cityscape. Image via Public domain.

The attorney general’s lawsuit specifically alleged that landlords and RealPage colluded to “artificially raise rents.”

The claims are similar to those made by Washington, D.C., Attorney General Brian L. Schwalb, who filed his own complaint against RealPage in November.

In his lawsuit, Schwalb said that, by managing rents for multiple landlords, RealPage manipulated market prices and effectively stifled competition by ensuring that rates were consistent across similar apartment complexes and properties.

“By providing highly detailed, sensitive, non-public leasing data with RealPage, the defendant landlords departed from normal competitive behavior and engaged in a price-fixing conspiracy,” Mayes’ office said. “RealPage then used its revenue management algorithm to illegally set prices for all participants.”

The complaint describes how RealPage and the “Lessor Defendants” conspired to create a “cartel” reliant on the outsourcing of pricing decisions to RealPage—in effect, letting the company set the highest-possible rents for landlords who might otherwise be forced to compete for tenants.

“By enabling property managers and owners to outsource lease pricing decisions to RealPage’s RM Software, RealPage has corrupted rental markets, replacing independent centers of decision-making with a single effective decision-maker: RealPage,” the lawsuit claims. “Lessors have agreed to delegate their rental price and supply decision to RealPage. They understood cooperation is essential to successfully raise rent prices above competitive levels.”

“Ordinarily,” the lawsuit says, “competitors do not agree to share detailed, sensitive, competitive information with one another.”

“But to join RealPage, lessors must agree to depart from normal behavior when competing with each other and provide RealPage with their ‘realtime lease transaction data,’” it alleges. “This data is non-public, ‘extremely targeted,’ and ‘as fine as granular bits of sand.’”

The lawsuit seeks varied remedies, including the payment of damages and civil penalties, as well as a court order prohibiting RealPage and the defendant landlords from engaging in similarly anticompetitive practices.


Arizona AG accuses landlords of illegally conspiring to raise rents in Phoenix, Tucson areas

Arizona AG Mayes sues multiple Valley landlords, software company over alleged rent price fixing

Attorney General Mayes Sues RealPage and Residential Landlords for Illegal Price-Fixing Conspiracy

Attorney General Schwalb Sues RealPage & Residential Landlords for Rental Price-Fixing, Illegally Raising Thousands of District Residents’ Rents

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