UPDATE: The FTC filed suit against Greystar Jan. 16, alleging it deceived customers about monthly rent costs by tacking on numerous fees.
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The Federal Trade Commission (FTC) is preparing to sue Greystar Real Estate Partners, the largest apartment landlord in the U.S., for charging hidden fees to tenants, the Wall Street Journal reports today, quoting unnamed sources.
The lawsuit will claim that Greystar misled tenants by not clearly disclosing extra fees for services like pest control, trash pickup, and background checks, the paper said.
It's possible Greystar will reach a settlement with the FTC before the suit is filed.
“Greystar has worked hard to lead the industry toward improved fee disclosures and has taken proactive steps over the last several years to promote greater fee transparency,” a Greystar representative told The Wall Street Journal. “The most effective path to achieving uniform and consistent fee disclosures across the industry is through clear regulatory guidelines which do not yet exist in the rental space.”
The FTC has been focused on hidden fees in various industries, including housing, and has pushed for clearer pricing. Last year, the FTC proposed rules to ban hidden fees and make it easier for consumers to compare prices.
If the lawsuit goes ahead, Greystar will be the first apartment landlord to face government action for hidden fees. This is part of a broader push by the Biden administration to regulate big companies and ensure fairness for consumers.
The case follows similar actions against other companies in the housing sector, and Greystar’s legal troubles could add to the growing scrutiny of the rental housing industry.
Greystar manages over 100,000 rental units and has faced class-action lawsuits from tenants regarding hidden fees. While Greystar has taken steps to show fees upfront, the FTC’s potential lawsuit could increase pressure on the company.
The lawsuit could also have broader implications for the rental housing sector as the FTC continues its efforts to address unfair business practices.