Large Colorado Landlord Promises to Stop Using Private Data for Rent Prices

A large corporate landlord operating in Colorado will no longer use private data to set rents after state Attorney General Phil Weiser and apartment management company Cortland came to an agreement.

Cortland’s Atlanta headquarters was raided by the FBI last June as part of an FBI investigation into rental price-fixing by RealPage, a software company used by swaths of landlords nationwide to determine how much to charge for rent. Cortland owns thirteen buildings in the Denver area and manages several buildings owned by other entities.

The Biden administration found RealPage’s influence covers over 45 percent of Denver’s multifamily rental units, costing renters an average of $136 extra per month than if the software hadn’t been used. Cortland management used RealPage to set rent, as well.

Colorado renters who live at Cortland properties will no longer be subject to RealPage’s influence in sixty days or less, according to the consent judgment between Weiser and Cortland.

“Coloradans who are struggling to make ends meet are getting hammered by high rent prices, and landlords that collude using private data from RealPage are a part of the problem,” Weiser said in the announcement of the agreement. “We are always looking at collaborative solutions when it comes to ensuring a competitive and fair marketplace, and I’m glad that Cortland will no longer be using non-public data from RealPage or software like it to set rents.

North Carolina Attorney General Jeff Jackson joined Weiser in the settlement, which resolves Cortland’s role in a lawsuit against RealPage filed by Weiser and seven other state attorneys general last August. The lawsuit alleges RealPage’s business model constitutes an illegal price-fixing scheme to raise rents by sharing private information among many landlords.

Cortland is one of six large landlords named in Wesier’s RealPage lawsuit; in the FBI investigation, the bureau examined 21 landlords for use of the software. Cortland will now assist Weiser in his office’s continued investigation into RealPage. The remaining landlords that are still part of the suit include Greystar, LivCor, Pinnacle Property Management by Cushman & Wakefield and Willow Bridge.

Cortland can still use a third-party revenue management software if that software does not include any “non-public data from other property management companies to set rents,” according to Weiser’s office. Any software Cortland uses is also prohibited from pooling or combining non-public data from owners other than Cortland or sharing Cortland data with other property owners.

Plus, Cortland can no longer use software incorporating “artificial rent floors or price decrease limits,” according to the settlement. Any new property using RealPage or other non-public data to set rents that Cortalnd acquires must cease to do so within thirty days of acquisition.

Cortland will pay both the Colorado and North Carolina AG’s offices $100,000 for “the state’s actual costs and attorneys’ fees, consumer education, enforcement or other consumer protection purposes,” according to the consent judgment. The payment is not a penalty or fine as part of the settlement involves an agreement that Cortland admits no fault.

The agreement lasts for four years but may be terminated after two if Colorado and North Carolina decide the agreement is not needed or does not benefit the public interest anymore.

House Bill 15-1004, sponsored by State Representative Javier Mabrey and Senator Steven Woodrow, would ban price-setting algorithm devices in Colorado. If that bill passes, the agreement may not be necessary in two years time as no landlords in the state could use such softwares. The bill has passed the House and is making its way through the Senate.