By Wendy Fry, CalMatters

If you’ve hunted for apartments recently and felt like all the rents were equally high, you’re not crazy: Many landlords now use a single company’s software — which uses an algorithm based on proprietary lease information — to help set rent prices.

Federal prosecutors say the practice amounts to “an unlawful information-sharing scheme” and some lawmakers throughout California are moving to curb it. San Diego’s City Council president is the latest to do so, proposing to prevent local apartment owners from using the pricing software, which he maintains is driving up housing costs.

San Diego’s proposed ordinance, now being drafted by the city attorney, comes after San Francisco supervisors in July enacted a similar, first-in-the-nation ban on “the sale or use of algorithmic devices to set rents or manage occupancy levels” for residences. San Jose is considering a similar approach.

And California and seven other states have also joined the federal prosecutors’ antitrust suit, which targets the leading rent-pricing platform, Texas-based RealPage. The complaint alleges that “RealPage is an algorithmic intermediary that collects, combines, and exploits landlords’ competitively sensitive information. And in so doing, it enriches itself and compliant landlords at the expense of renters who pay inflated prices…”

But state lawmakers this year failed to advance legislation by Bakersfield Democratic Sen. Melissa Hurtado that would have banned the use of any pricing algorithms based on nonpublic data provided by competing companies. She said she plans to bring the bill back during the next legislative session because of what she described as ongoing harms from such algorithms.

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“We’ve got to make sure the economy is fair and … that every individual who wants a shot at creating a business has a shot without being destroyed along the way, and that we’re also protecting consumers because it is hurting the pocketbooks of everybody in one way or another,” said Hurtado.

RealPage has been a major impetus for all of the actions. The company counts as its customers landlords with thousands of apartment units across California. Some officials accuse the company of thwarting competition that would otherwise drive rents down, exacerbating the state’s housing shortage and driving up rents in the process.

“Every day, millions of Californians worry about keeping a roof over their head and RealPage has directly made it more difficult to do so,” said California Attorney General Rob Bonta in a written statement.

A RealPage spokesperson, Jennifer Bowcock, told CalMatters that a lack of housing supply, not the company’s technology, is the real problem — and that its technology benefits residents, property managers, and others associated with the rental market. The spokesperson later wrote that a “misplaced focus on nonpublic information is a distraction… that will only make San Francisco and San Diego’s historical problems worse.”

As for the federal lawsuit, the company called the claims in it “devoid of merit” and said it plans to “vigorously defend ourselves against these accusations.”

“We are disappointed that, after multiple years of education and cooperation on the antitrust matters concerning RealPage, the (Justice Department) has chosen this moment to pursue a lawsuit that seeks to scapegoat pro-competitive technology that has been used responsibly for years,” the company’s statement read in part. “RealPage’s revenue management software is purposely built to be legally compliant, and we have a long history of working constructively with the (department) to show that.””

The company’s challenges will only grow if pricing software becomes another instance in which California lawmakers lead the nation. Following San Francisco’s ban, the Philadelphia City Council passed a ban on algorithmic rental price-fixing with a veto-proof vote last month. New Jersey has been considering its own ban.

Is It Price-fixing — or Coaching Landlords?

According to federal prosecutors, RealPage controls 80% of the market for commercial revenue management software. Its product is called YieldStar, and its successor is AI Revenue Management, which uses much of the same codebase as YieldStar, but has more precise forecasting. RealPage told CalMatters it serves only 10% of the rental markets in both San Francisco and San Diego, across its three revenue management software products.

Here’s how it works:

In order to use YieldStar and AIRM, landlords have historically provided RealPage with their own private data from their rental applications, rent prices, executed new leases, renewal offers and acceptances, and estimates of future occupancy, although a recent change allows landlords to choose to share only public data.

This information from all participating landlords in an area is then pooled and run through mathematical forecasting to generate pricing recommendations for the landlords and for their competitors.

San Diego City Council President Sean Elo-Rivera, explained it like this:

“In the simplest terms, what this platform is doing is providing what we think of as that dark, smoky room for big companies to get together and set prices,” he said. “The technology is being used as a way of keeping an arm’s length from one big company to the other. But that’s an illusion.”

In the company’s own words, from company documents included in the lawsuit, RealPage “ensures that (landlords) are driving every possible opportunity to increase price even in the most downward trending or unexpected conditions.” The company also said in the documents that it “helps curb (landlords’) instincts to respond to down-market conditions by either dramatically lowering price or by holding price.”

Providing rent guidance isn’t the only service RealPage has offered landlords. In 2020, a Markup and New York Times investigation found that RealPage, alongside other companies, used faulty computer algorithms to do automated background checks on tenants. As a result, tenants were associated with criminal charges they never faced, and denied homes.

Impact on Tenants

The attorneys general of eight states, including California, joined the Justice Department’s antitrust suit, filed in U.S. District Court for the Middle District of North Carolina.

The California Justice Department contends RealPage artificially inflated prices to keep them above a certain minimum level, said department spokesperson Elissa Perez. This was particularly harmful given the high cost of housing in the state, she added. “The illegally maintained profits that result from these price alignment schemes come out of the pockets of the people that can least afford it.”

Renters make up a larger share of households in California than in the rest of the country —  44% here compared to 35% nationwide. The Golden State also has a higher percentage of renters than any state other than New York, according to the latest U.S. Census data.

The recent ranks of California legislators, however, have included few renters: As of 2019, CalMatters could find only one state lawmaker who did not own a home — and found that more than a quarter of legislators at the time were landlords.

The State Has Invested in RealPage

Private equity giant Thoma Bravo acquired RealPage in January 2021 through two funds that have hundreds of millions of dollars in investments from California public pension funds, including the California Public Employees’ Retirement System, the California State Teachers’ Retirement System, the Regents of the University of California and the Los Angeles police and fire pension funds, according to Private Equity Stakeholder Project.

“They’re invested in things that are directly hurting their pensioners,” said K Agbebiyi, a senior housing campaign coordinator with the Private Equity Stakeholder Project, a nonprofit private equity watchdog that produced a report about corporate landlords’ impact on rental hikes in San Diego.

RealPage argues that landlords are free to reject the price recommendations generated by its software.

RealPage argues that landlords are free to reject the price recommendations generated by its software. But the U.S. Justice Department alleges that trying to do so requires a series of steps, including a conversation with a RealPage pricing adviser. The advisers try to “stop property managers from acting on emotions,” according to the department’s lawsuit.

If a property manager disagrees with the price the algorithm suggests and wants to decrease rent rather than increase it, a pricing advisor will “escalate the dispute to the manager’s superior,” prosecutors allege in the suit.

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By Magaly Muñoz

Assemblymembers Mark Haney (D-San Francisco) and Buffy Wicks (D-Oakland) visited downtown Berkeley on Dec. 4 to meet with city leaders about public safety and revitalizing the area that has been experiencing increasing crime and blight.

Haney, who did his undergraduate degree a few blocks away at UC Berkeley, has been on a tour of different cities across California to explore why previously bustling downtowns are losing foot traffic and commercial tenants.

Over the past few years, several reports have been released across the country highlighting the need to revitalize commercial districts in post-pandemic America. All of them indicate that there has been a decline in people shopping at local businesses, eating at restaurants, and enjoying downtown nightlife options.

Berkeley is no different.

In 2023, the city reported an 11.9% vacancy rate for businesses in the downtown area. City leaders said they cannot find a way to incentivize people to visit their locations.

Simone, owner of Almare Gelato Italiano, told the Assemblymembers that there is a “dark side” to this corridor that not many see. He said that residents feel unsafe visiting that particular area after a certain time and his workers also fear for their lives as they often experience harassment from random people walking by his shops.

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“I can tell you that being here for my business is a big risk, a big challenge,” Simone said.

Simone blames District Attorney Pamela Price, who was recently recalled from office in November, for not taking crime seriously and prosecuting people who steal and commit crimes that impact local retailers. He also said that there is an abundance of homeless people walking aimlessly around the city disturbing patrons.

Dorothée Mitrani, owner of La Note, a restaurant in Berkeley, says the police are not responsive when business owners call to report harassment at their locations. She said police will only show up if an “actual crime” has been committed.

Simone said there needs to be more trust in police and an increase in their presence might help maintain order and mitigate recurring problems.

As a part of Haney’s downtown tour, his team was taken to different parts of Berkeley, including Old City Hall, which homeless advocates are occupying in an effort to resist shutdowns of homeless encampments.

In September, the Berkeley City Council relaxed restrictions for sweeps, stating encampments can be removed even without the availability of shelter — a hard stance for liberal-leaning city.

Peter Radu, assistant to the city manager, told Haney and Wicks that the city is committed to ensuring and maintaining public safety and cleanliness, and will continue with a housing-first approach.

Radu shared that through the pandemic officials were able to learn that unhoused people are more inclined to choose housing when they have more options, such as non-congregate shelters. The city is hoping to obtain additional grants, similar to the ones received during the pandemic, to fund facilities that will allow people to have more housing options.

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Will Biden’s aid for an above-the-ground Railroad help ease the pain for the African Americans’ Underground Railroad?

By Post Staff
And news dispatches from the Guardian, CNN and AP

When President Joe Biden went to Angola this week the purpose was ostensibly to advance the Lobito Corridor, an unfinished 800-mile railway project meant to facilitate the transfer of critical minerals from interior countries to western ports for exports.

But in a visit to the country’s slave museum, he acknowledged America’s dark past and its connection to Angola in the presence of three descendants of the first captives who arrived in Virginia from Angola in 1619.

The child of two of those captives — Antony and Isabella — was William Tucker, born around 1623. Three of his descendants were present when Biden spoke at the country’s slave museum and humbly acknowledged how the horrific history of slavery has connected the United States and Angola.

“While history can be hidden, it cannot and should not be erased. It should be faced. It’s our duty to face our history,” he said. “The good, the bad and the ugly. The whole truth. That’s what great nations do,” he said.

“It was the beginning of slavery in the United States. Cruel. Brutal. Dehumanizing. Our nation’s original sin. Original sin. One that’s haunted America and cast a long shadow ever since,” Biden spoke as he honored the Tucker family.

After introducing Wanda Tucker, Vincent Tucker and Carlita Tucker, he delivered a hopeful vision for the future in a major speech from the country that was the point of departure for millions of enslaved Africans.

(Wanda Tucker now serves as the faculty chair of psychology, philosophy and religious studies at Rio Salado College in Arizona.)

“Our people lie at the heart of a deep and profound connection that forever binds Africa and the United States together.  We remember the stolen men and women and children who were brought to our shores in chains and subjected to unimaginable cruelty,” Biden said in remarks at the National Museum of Slavery, which is built near the chapel where enslaved individuals were forcibly baptized before being sent to America.

The museum was built on the property of Álvaro de Carvalho Matoso, one of the largest slave traders on the African coast.

Biden told the attendees that he’s proud to be the first president to visit Angola and that he’s “deeply optimistic” about the future relationship between the nation and the US.

“The story of Angola and the United States holds a lesson for the world. Two nations with a shared history, an evil of human bondage,” Biden said. “Two nations on the opposite sides of the Cold War, the defining struggle of the late part of the 20th century. And now, two nations standing shoulder to shoulder working together every day. It’s a reminder that no nation need be permanently the adversary of another.”

Biden’s trip aimed to highlight U.S. investments in Angola and the continent in the face of deepening Chinese influence in the region, as Beijing has poured hundreds of billions of dollars into Africa through its Belt and Road Initiative.

Biden took a swipe at China’s moves, without calling out the country by name, and argued the US presents a better alternative.

“The United States understands how we invest in Africa is as important as how much we invest,” Biden said.

“In too many places, 10 years after the so-called investment was made, workers are still coming home on a dirt road and without electricity, a village without a school, a city without a hospital, a country under crushing debt. We seek a better way, transparent, high standard, open access to investment that protects workers and the rule of law and the environment. It can be done and will be done,” the president said.

Biden’s speech comes during what likely could be his last trip abroad as president and as he seeks to deepen relationships with Angola and other African nations at a time when China has made significant inroads in the continent with hundreds of billions of dollars of infrastructure investments, far outpacing the U.S.

During his remarks, Biden touted U.S. efforts to expand its relationships across Africa, including billions of dollars in investments in Angola.

He also announced over $1 billion in new US humanitarian assistance for Africans who have been displaced by historic droughts across the continent.

“But we know African leaders and citizens are seeking more than just aid. You seek investment.

So, the United States is expanding its relationships all across Africa,” Biden said, adding later: “Moving from patrons to partners.”

Ahead of his remarks, the president also met with Angolan leaders, including young people at the museum.

Biden started his day with a bilateral meeting with Angolan President João Manuel Gonçalves Lourenço at the presidential palace in Luanda.

The two men discussed trade and infrastructure, including the US and Europe’s investment in the railroad. They also discussed mutual security interests as Angola has played a key mediating role in the conflict in the eastern Democratic Republic of the Congo.

In November, Angola announced their Incremental Production Decree of fiscal terms designed to enhance the commercial viability of developing oil and gas fields. The decree enhances the commercial viability of developing fields in mature blocks, underexplored areas and stranded resources, while encouraging exploration near existing infrastructure. The US Railroad infrastructure investments could play a major role in enabling increased recovery from producing fields and extending the lifespan of critical infrastructure, the decree is set to generate billions in offshore investments, create jobs and drive economic growth, solidifying Angola’s position as a leading oil and gas producer.

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