A company that assists many apartment complexes in the Charlotte area with setting rents is facing a federal antitrust lawsuit. The suit claims that apartment managers utilize the company's advanced AI software to maintain elevated rent levels. For more on this and other business news, I'm joined now by Tony Mecia of the Charlotte Ledger Business Newsletter for our segment BizWorthy.
Chris Jones: Traditional price fixing is when apartment owners meet to collude on prices. But this DOJ — that's Department of Justice — lawsuit alleges a different method to achieve the same end. How does the lawsuit allege this works?
Tony Mecia: Yeah, Chris. It's a little bit different than what you would think of as traditional price-fixing. Instead of owners of something coming together and setting prices, you know, conspiring against people who want to rent, this says it was really using this AI software. The company is called RealPage. And what it does is it collects information from different apartment complexes about how much they're setting their rents for. It then provides that information to other apartment complexes and recommends rents. It's a revenue maximization tool, but the Department of Justice is saying that it is a price-fixing scheme.
Incidentally, it has identified Charlotte as one of the 10 largest metro areas where this software is used. A lot of large apartment complexes use it. The company says that it's completely legal.
Also, it's worth pointing out the rents in Charlotte are down year over year, about 2% in the apartments. So, we'll have to see how this one plays out. But it's a little bit of a different twist on the traditional price-fixing.
Jones: Another question for you, Tony. The Charlotte City Council voted Monday night to spend $22 million to design the third phase of the Concourse A expansion. Now, where does this fit in with the seemingly never-ending construction at CLT?
Mecia: Yes, you know, there's a lot of construction going on at the airport. You know, in the lobby expansion project, in particular. But this would expand the A concourse even further than it is already currently expanded. The airport has finished renovation of phase one of the expansion. They're on the cusp of finishing phase two of the expansion, which is supposed to open this fall and add 10 more gates. And then the city council agreed to fund a design contract for the third phase of the A expansion. This is going back toward Wilkinson Boulevard, toward the long term one lot.
This is just something that's seen as necessary as the airport continues to grow, and I think that construction at the airport really is going to be never-ending.
Jones: All right, expanding all the way to the parking lot. All right, let's move on, Tony. A first for Charlotte — it's a graffiti park and outdoor gallery in NoDa. What can you tell us about this space?
Mecia: Yeah, it's a little bit unusual. This is being billed as an outdoor gallery, a graffiti park. There are 28-foot-tall canvases at 2200 North Brevard Street. It's supposed to open in the middle of September. It's being called the — I don't know how to pronounce this, Chris —TAOH [Tau] Gallery. It stands for The Awakening of Humanity. And it's seen as an incubator for local artists, where they can come and they can do graffiti art.
Jones: All right, nice to have something new and an outlet for those creatives. Finally, Tony, Johnson C. Smith University recently launched a 10-day emergency aid campaign to raise $250,000 for students in need of financial aid. But a question posed to The Ledger pointed out JCSU just got $80 million from the Mayor's Racial Equity Initiative. Why are they having to scramble for financial aid? That was the question. What did The Ledger find out?
Mecia: Yeah, we looked into it and found out that the money from this public-private partnership really goes toward transforming the university, helps with academic programs. But for patching some of the holes and gaps that exist for financial aid, they still have those needs. QCity Metro reported this week that they had already surpassed the $250,000 mark, and that the university has raised more than $300,000. So, it sounds like some good news there for Johnson C. Smith.
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