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Former City Manager’s Firm Accused of Rent Price Fixing

By Tom Marino | June 17, 2024
Last Updated: June 18, 2024

WORCESTER – WinnCompanies, where former Worcester City Manager Michael O’Brien is executive vice president, and Greystar, the largest property management firm in the world, are two of 34 co-defendants in multiple antitrust lawsuits. The litigation alleges collusion and illegal price fixing of residential rent prices.

Both companies manage multi-family properties in Worcester.

The federal Sherman Act of 1890, which forms the base of antitrust law in the United States, including prohibitions on collusion and price fixing. According to the U.S. Department of Justice, “generally speaking, price fixing involves an agreement by two or more competing producers of a specific commodity, or competing providers of a particular service, in a defined geographic area, to raise, set or maintain prices for their goods or services.”

The cases involving WinnCompanies, Greystar, and 32 other real estate companies allege the companies shared confidential pricing data through a software product and service by RealPage. That software uses an algorithm and artificial intelligence (AI) to make pricing recommendations on rent price for each individual vacant unit within the portfolio of real estate companies with RealPage’s software.

According to CNBC, RealPage software recommends rent prices on 4.5 million housing units in the U.S.

Critics also allege the software recommended some properties operate at less than full capacity, leaving some housing units vacant during a vacancy crisis.

Plaintiffs in the cases argue that by agreeing to share sensitive pricing data with competitors through RealPage, the real estate companies agreed to collude in artificial rent pricing.

RealPage says it designed its software for legal compliance and that Yieldstar also helps prevent units being overpriced and keeps prices and occupancy stable. It also says landlords are not obligated to follow the recommendations of the software.

About RealPage

RealPage, a software company serving residential property management companies, is at the center of 21 federal antitrust lawsuits. WinnCompanies is a co-defendant in two of those cases, while Greystar is a co-defendant in 20.

RealPage, based in Richardson, Texas and founded in 1998, provides property management software for the multifamily, commercial, single-family, and vacation rental housing industries. The company went public in 2010 and traded on Nasdaq until 2021, when Thoma Bravo, LP, a Chicago-based private equity firm that today has over $130 billion under management, acquired the company and took it private.

According to its website, RealPage has over 31,000 clients and collects data on a massive number of residential units across the country. Using that and other data, the software makes recommendations to property managers on pricing for each individual vacant unit it has available. The software updates its pricing recommendations daily.

In 2002, RealPage acquired a software product, Yieldstar, from Camden Property Trust, a Houston, Texas company that invests in residential rental properties. Camden went public in 1993 and trades on the New York Stock Exchange.

Data Sharing and Algorithmic Rental Price Setting

According to RealPage’s announcement of the acquisition in 2002, Yieldstar “is designed to help property owners optimize pricing of apartment inventory using sophisticated yield models that adjust apartment rents in real time to reflect imbalances in supply and demand.”

According to a report by ProPublica in October 2022, RealPage’s algorithm calculates how demand for apartments responds to changes in price.

On an archived version of a page that no longer appears on the RealPage website, the company appears to admit its software drives rents higher. The website appealed to potential customers to, “Find out how YieldStar can help you outperform the market 3% to 7%.”

ProPublica also reported that during an earnings call in 2017 that RealPage founder and then-CEO Steve Winn said “one large property company, which managed over 40,000 units, learned it could make more profit by operating at a lower occupancy level that ‘would have made management uncomfortable before.”

(Editor’s note: This Week in Worcester is not aware of any connection, familial or otherwise, between RealPage founder Steve Winn and WinnCompanies founder Arthur Winn.)

Since acquiring Yieldstar, RealPage rebranded the product as AI Revenue Management.

ProPublica found that in one neighborhood in Seattle, just 10 property managers oversee 70 percent of apartments, and all 10 used RealPage’s pricing software.

According to a lawsuit in Washington D.C., 90 percent of buildings with 50 or more units use RealPage’s revenue management software.

Legal Action Against RealPage

Various legal actions related to Yieldstar are underway. While the cases have some differences, they all argue that the software enables property management companies to share anonymous private pricing data with competitors.

The complaints argue that major residential landlords colluded with RealPage to raise rents by sharing confidential pricing data and using RealPage’s algorithm as a mechanism to set artificial prices.

AI and algorithmic price setting have yet to face a major challenge in state or federal courts.

ProPublica quoted a 2017 talk by the then-Acting Chair of the Federal Trade Commission Maureen Ohlhausen. She suggested substituting “a guy named Bob” everywhere the word algorithm appears.

“Is it OK for a guy named Bob to collect confidential price strategy information from all the participants in a market and then tell everybody how they should price?” Ohlhausen said. “If it isn’t OK for a guy named Bob to do it, then it probably isn’t OK for an algorithm to do it either.”

In late 2022, the DOJ opened a civil investigation into RealPage’s pricing practices.

In April 2023, a federal court consolidated 21 civil cases against RealPage to a single joint case in federal court in Nashville, Tennessee. These include cases from Colorado, Massachusetts, Tennessee, Texas, Washington, and Washington D.C. The new consolidated case has 34 co-defendant real estate companies.

On Oct. 5, 2023, the DOJ Antitrust Division filed a brief in the case. DOJ argued that apartment operators’ use of a shared algorithm violated antitrust law. The DOJ brief urged the court to deny the defendants’ motion to dismiss the case, which it did.

On Nov. 1, 2023, Washington D.C. Attorney General Brian Schwalb announced he had sued RealPage and 14 large residential landlords. The lawsuit alleges the companies colluded to raise rents illegally. The lawsuit says that over 90 percent of apartment buildings in the Washington D.C. metro area with over 50 rental units use RealPage’s revenue management software.

On Feb. 28, Arizona Attorney General Kris Mayes announced the state sued RealPage and nine of its customers who are major residential landlords. The lawsuit alleges a conspiracy by the companies to raise rents illegally.

On March 4, North Carolina Attorney General Josh Stein announced he launched an investigation into RealPage over concerns about anticompetitive conduct to raise the cost of rental housing.

Politico reported on March 20 that the Department of Justice had opened a criminal investigation into the possibility that RealPage is facilitating price-fixing.

On June 5, the Federal Bureau of Investigation (FBI) executed a limited search warrant at the Atlanta offices of Cortland, a RealPage client. Cortland manages over 60,000 apartments in the United States. The company said that neither it nor its employees are targets of the investigation. The company is a defendant in Weaver vs. Realpage, Inc. et al., one of the federal antitrust litigation lawsuits the court consolidated in Nashville.

RealPage in Worcester

It is difficult to determine what effect RealPage’s pricing algorithm has had on rental prices in any market, but the company’s products are popular in the industry.

As This Week in Worcester previously reported, a report by Forbes in April found Worcester as the third worst market for housing renters in the United States.

Two companies with properties in Worcester are named co-defendants in the lawsuits against RealPage.


Founded in 1971, WinnCompanies specialize in residential real estate development and property management. It has over 103,000 rental units under management across 27 states through its property management subsidiary, WinnResidential, according to its website. It also says it owns over 125 communities nationwide.

A significant part of Winn’s portfolio includes affordable housing.

The company announced on Feb. 28, 2018 that WinnResidential converted its software platform to RealPage.

Two of the 21 federal lawsuits involving RealPage name both WinnCompanies, LLC, and WinnResidential Manager Corp as co-defendants. Both cases originate in Massachusetts. They are:

  • White v. RealPage, Inc. et al.; and
  • Precht v. RealPage, Inc. et al.

Former Worcester City Manager and Winn Executive Vice President

Michael O’Brien is executive vice president of WinnCompanies and one of three individuals listed as its leadership team. O’Brien was Worcester City Manager from 2004 to 2014.

During O’Brien’s tenure as city manager, Winn developed the Canal Lofts and began the development of Voke Lofts.

O’Brien announced in November 2013 that he would leave the city manager position to join Winn Companies in January 2014.

Commenting on O’Brien’s announcement, then-City Councilor Barbara Haller said it surprised her O’Brien would go to Winn, which focuses on affordable housing. She said affordable housing is something for which O’Brien “never had a particular craving.

As This Week in Worcester previously reported, Worcester City Manager Eric Batista described O’Brien as a mentor during his inaugural address in January 2023.

Winn is the developer of the former Boys Club location at 16 Salisbury St., which is currently under construction. It received $1.75 million from the City of Worcester’s Affordable Housing Trust Fund to develop the property.

WinnResidential will be property manager of the Cove location at 99 Green St. Residency there begins in September.

WinnResidential, the property management arm of WinnCompanies, has the following properties under management in Worcester County, according to its website:

  • Coes Pond Village, 39 First St., Worcester
  • Canal Lofts Apartments, 48 Water St., Worcester
  • Voke Lofts, 71 Salisbury St., Worcester
  • Wellington Community, 714 Main St., Worcester
  • Fitchburg Place, 16 Prichard St., Fitchburg
  • Yarn Works, 1428 Main St, Fitchburg
  • Hafstead Holden, 90 Central Park, Holden
  • Southbridge Mills, 5 Case St., Southbridge
  • Residences at Wells School, 89 Marcy St., Southbridge
  • North Village, 18 Village Way, Webster
  • Hartley Terrace, 52 Hartley St., Webster
  • Olde English Village, 152 Manca Dr., Gardner
  • Hafstead Milford, Green 1 Rolling Green Dr., Milford


Founded in 1993, Greystar has over 966,700 multifamily units and student beds under management. It also says it has over $36 billion in global development assets, with over 25,800 employees in 249 global markets across 65 offices. Several sources list Greystar as the world’s largest property management company.

Greystar is named a co-defendant in 20 of the 21 federal lawsuits involving RealPage, now consolidated in federal court in Tennessee. One of those lawsuits names only RealPage and no property management firms.

Greystar has three properties under management in Worcester County, all in the city.

  • Colton Apartments, 588 Main St., Worcester
  • The 6Hundred, 600 Main St., Worcester
  • Alta on the Row, 22 Mulberry St., Worcester

A request for comment by O’Brien was unanswered at the time of publication.

This Week in Worcester sent questions to a representative of Worcester City Manager’s office, asking if the administration was aware of the litigation and if it planned any inquiry or investigation to determine if the scheme has inflated rent prices in Worcester. No response was received by the time of publication.

John Keough contributed to this story

Image Credit: Google

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