Alexandria locations have been hit by a regional property management lawsuit over artificially inflating rents
DCist first reported that a lawsuit filed by D.C. Attorney General Brian Schwalb over alleged artificial rent inflation will affect some of the area’s largest landlords, including companies with properties in Alexandria.
Schwalbe’s lawsuit alleges that landlords are acting as a rent-setting monopoly that uses Texas-based property management software company RealPage to artificially raise rental prices throughout the area.
According to the lawsuit:
In practice, RealPage has focused on cartelizing buildings with the highest number of units (i.e. buildings with fifty or more units). In the area, great
The majority of units in large multifamily buildings — nearly 60% — set their prices using RealPage’s RM software.
In the Washington-Arlington-Alexandria Metropolitan Statistical Area, that number is even higher: more than 90% of units in large buildings are priced using RealPage’s RM software.
In practical terms, this leaves many area residents no choice but to pay RealPage’s inflated rents.
The largest defendant in the lawsuit is Greystar, which manages six communities throughout Alexandria and uses RealPage RM software for pricing:
- Bailey Crossings Apartments
- Del Rey Tower at Views
- Degree 8
- Station 650 Apartments
- The Blake
Other defendants in the lawsuit include Avenue5 Residential, which owns e-Lofts in the West End, and Avalon Communities, which owns Avalon Potomac Yard. Another developer in the lawsuit, JBG Smith, was part of the Potomac Yard redevelopment plans.
“RealPage, the defendant landlords, and other co-owners illegally agreed to forego competition in favor of using a central entity — the RealPage RM software — to set apartment rents,” the lawsuit states.
It is publicly recognized by cartel members, and closely monitored to ensure compliance.
The lawsuit said RealPage suppresses landlords’ independent price decision-making and requires landlords to charge rents generated by the company’s software. Landlords using the program touted their ability to raise rents by 20% or more, the lawsuit said.
The lawsuit comes on the heels of years of rent increases, with many of the defendants in the lawsuit owning top-tier apartments in Alexandria that saw rents increase by 4.7% on average over the past year.
Image via Blake/Facebook
(tags for translation) Apartment building