Supported by Partner Engineering and Science

Propmodo Daily

Greetings!

Today’s email is supported by our friends at Partner Engineering and Science. Partner is the leading provider of engineering, environmental, construction, energy, and valuation consulting for the commercial real estate industry. Coming up on June 27th, they will be hosting a webinar about what the EPA’s crackdown on “forever chemicals” means for the real estate industry. Keep reading to learn more, and register here.

Embattled multifamily software company RealPage has released a statement denying that their software is responsible for rising rents, instead highlighting its role in promoting a healthier rental housing ecosystem. They also launched a website addressing housing affordability and defending their practices. As we discuss in today's email, RealPage recognizes that the battle extends beyond the courts to public opinion, especially with the FBI raiding one of their clients and other negative press.

Join us for a Propmodo Live webinar on July 9th to explore multifamily strategies for H2 2024. As residents' needs and preferences evolve, property owners and managers must innovate to stay competitive. Experts from JLL, Defigo, Veritas, and Propmodo will share insights on innovative management, effective lease negotiations, and future market trends. Discover how to attract and retain residents and enhance property value in the changing multifamily landscape.

And in case you missed it, this week in Propmodo Technology, we are exploring the challenges of site selection with articles about overcoming environmental, zoning, and infrastructure problems, how Ottawa is using digital twin for redevelopment planning, and how tech can help find and fix contaminated properties.

Now, let's dig in!

RealPage Finally Makes Public Statement About Its Rent Pricing Algorithm

Yesterday, we published an article about a new report implicating landlords who use RealPage’s rent optimization software, YieldStar. In it, I wrote: “Whether RealPage and its clients can defend themselves or not, public opinion has soured. Although defendants are likely cautious about making public statements during ongoing court cases, eventually, the industry will need to join the conversation about pricing practices that the public is already having without them.” Well, it turns out that a public statement was already on the way.

RealPage has now shared a public statement in a press release about the “false narrative concerning revenue management software.” In the statement, the company explains that its rent pricing tool isn’t to blame for the persistent increases in rental housing. Instead, they say their software contributes to a healthier and more efficient rental housing ecosystem. “Housing affordability should be the real focus. RealPage is proud of the role our customers play in providing safe and affordable housing to millions of people,” said Dana Jones, RealPage CEO and President.

Along with the press release, RealPage has also set up a website dedicated to its public policy on its revenue optimization tool. It includes information about the housing affordability crisis, quotes from experts on why software isn’t to blame for rising rents, and answers to frequently asked questions. One of those answers explains that vacancy and retention are also important parts of the revenue optimization calculation: “Revenue management software helps prevent rents from reaching unaffordable levels. If rents are set too high, vacancy spikes, and apartment providers generate no revenue on vacant units. Over the last decade, vacancy and resident turnover both steadily decreased while revenue management software usage increased.”

I applaud RealPage for addressing this hot-button issue with a public statement. They clearly now realize that the battle extends beyond the courts to public opinion. While they provide valuable context and a logical argument, they face a far more significant problem than just a reputational hit.

Last week, one of their clients, Cortland Management, was raided by the FBI over its use of YieldStar, indicating they are dealing with criminal charges. Also, an article published this week included quotes from a former revenue officer at Cortland Management, which further tarnished the company’s image. “It was really hard to work on-site at a property, especially for people with any compassion or humanity,” the former employee said. If RealPage and its clients find themselves in front of a judge or jury, this kind of testimony could severely impact their ability to defend their case, regardless of the facts.

PRESENTED BY PARTNER ENGINEERING AND SCIENCE
PFAS and Liability: How EPA’s Recent Actions Impact CRE Owners

EPA’s recent crackdown on PFAS or “forever chemicals” will have significant implications for the commercial and industrial real estate sectors. In April 2024, EPA introduced stringent measures to regulate PFAS, including finalizing the National Primary Drinking Water Regulation for six PFAS chemicals and designating PFOA and PFOS as hazardous substances under CERCLA, effective July 8, 2024. These actions, among others, could expose real estate investors, developers, owners, and operators to cleanup obligations and costs, as well as environmental damages and liability for human health risks.

Learn more about PFAS, EPAs actions, and how to evaluate property risk and assess liability via this free webinar from Partner Engineering and Science, Inc.

More News

Insider Insights

🐎 Horse’s mouth: The residential property listing site Flyhomes is being called a “dark horse” for its connection to Sam Altman and its use of AI in home searches.

💿 Centering your data: CBRE has agreed to acquire data center IT service firm Direct Line Global for an undisclosed amount.

Overheard

Propmodo Technology: Site Selection

Are You Enjoying This Newsletter?

Propmodo Daily is written and edited by Franco Faraudo with contributions from readers like you and the Propmodo team.

📧 Forward it to a friend and suggest they check it out.

🔗 Share a link to this post on social media.

🗣 Have ideas for future topics (or just want to say hello)? Share your feedback and tips at [email protected] or connect with us on X through @propmodo.

✅ Not subscribed yet? Sign up for this newsletter here.

📫️ Please add our newsletter email, [email protected], to your contacts to make sure you don’t miss any updates.

Explore Propmodo

• Read exclusive articles about a variety of topics, including Real Estate, Workplace, Buildings, and Development.

• Browse our collection of interactive Propmodo Research e-books.

• Sign up for upcoming Propmodo Live Webinars or watch past Propmodo Live videos on-demand.

• Dive into Propmodo Technology articles, podcasts, and short videos about the future of commercial real estate.

Enjoy reading about trends and innovation in commercial real estate? Subscribe to Propmodo.com for unrestricted access to reliable, data-driven journalism and exclusive insights available only to subscribers.