One of Colorado’s largest landlords will soon be required to disclose the total price of its apartments to prospective tenants, ending its practice of not publicly listing additional fees in advertisements.
The agreement between Greystar, federal regulators and the Colorado Attorney General’s Office was announced Tuesday, ending a nearly year-old lawsuit that had accused the property management giant of illegally misrepresenting costs to renters. Greystar will be required to pay $1 million to Colorado for regulatory oversight, and it will pay $23 million to the Federal Trade Commission, with that money going to refund Greystar renters — including those in Colorado.
The settlement requires Greystar to list the full rental price of its units, including any fees, in its advertising. The company must also describe whether the fees are optional or required, the purpose of the fees and when a tenant will be charged.
The company is required to comply within 90 days.
“Addressing deceptive and hidden fees that trick consumers out of their hard-earned dollars is a top priority for our department,” Attorney General Phil Weiser said in a statement. “In this case, we took action against Greystar for doing just that and have held them accountable for their conduct which jacked up rents. Other landlords are on notice that cheating tenants won’t be tolerated in Colorado.”
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In a separate statement, Greystar said the settlement “enhances transparency in the multifamily housing industry and provides much-needed clarity on the FTC’s expectations for advertising rental housing” — namely, that “federal law requires displaying the total monthly leasing price” in that advertising.
The settlement comes two weeks after Weiser settled a separate lawsuit against Greystar, which operates more than 45,000 housing units in the state. The prior settlement was related to Greystar’s use of a rent-setting algorithm that Weiser and the U.S. Department of Justice alleged had been used by competing landlords to illegally coordinate rent prices and hike costs.
In the fees case, Weiser and the FTC alleged that Greystar’s practices violated state and federal laws. The suit described two Denver apartment complexes where fees pushed the cost of rent above what had been publicly advertised.
“Greystar misled consumers by advertising low rent prices and then adding mandatory fees at the end of the sales process,” Christopher Mufarrige, the director of the FTC’s consumer protection bureau, said in a statement Tuesday.
After The Denver Post reported late last year on the burden that hidden fees placed on Colorado tenants, state lawmakers passed a bill requiring more price transparency while prohibiting landlords from charging certain fees, such as for common-area maintenance. That law goes into effect Jan 1.
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