Greystar to Pay Colorado, FTC $24 Million Settlement

Hot off one multi-million dollar settlement with the U.S. federal government, Greystar has agreed to settle another suit involving the state of Colorado for more than three times as much.

Greystar agreed to pay $24 million to settle a lawsuit from the U.S. Federal Trade Commission and the state of Colorado that accused the South Carolina-based company of deceiving renters in its properties about rent fees, Bloomberg reported. The FTC will receive $23 million, while Colorado will walk away with $1 million; most of the total settlement will go toward making things whole with its renters via refunds.

The firm manages more than 946,000 units, making it far and away the country’s largest multifamily owner and property manager, per National Multifamily Housing Council cited by Bloomberg.

In addition to paying out the settlement, Greystar also agreed to change how it discloses potential fees associated with its properties when communicating with renters.

“Greystar misled consumers by advertising low rent prices and then adding mandatory fees at the end of the sales process,” Christopher Mufarrige, director of the FTC’s consumer protection bureau, said in a statement, noting the agency is “monitoring the housing marketplace to ensure that competitors are meaningfully competing on price and that consumers receive transparent pricing.”

Greystar deflected such comments, saying in a statement that the settlement “enhances transparency in the multifamily housing industry and provides much-needed clarity on the FTC’s expectations for advertising rental housing.”

The lawsuit dates back to January of this year when the FTC and the state of Colorado sued the company claiming it failed to disclose mandatory fees potential renters must pay upfront before securing an apartment.

Greystar’s settlement comes just weeks after the firm struck another settlement deal involving deceptive pricing.

The multifamily operator agreed to pay $7 million in an antitrust suit from the Department of Justice that claims Greystar and other landlords used RealPage’s revenue-management software in a wide-reaching rent collusion case. Prosecutors in that case claimed RealPage’s artificial intelligence-powered platform allowed landlords to share competitive pricing data and force each other’s hand into raising rents.

Under the multi-state settlement, Greystar will be barred from using, soliciting or sharing non-public information when setting rents, such as occupancy levels, executed rents or concession data.

— Chris Malone Méndez