Impact Growth Capital Newsletter

Feds won’t budge, DOJ Targets Landlords, and a Halo Communities Announcement

Impact Growth Capital
January 09, 2025

_{This week: Feds won’t budge, DOJ Targets Landlords, and a Halo Communities Announcement.}

_{Economic News}

_{Fed Holds Steady: No Rate Cuts Expected at January Meeting}

_{The Federal Reserve plans to keep interest rates unchanged at its upcoming January meeting, maintaining the current 4.25%–4.5% range. This decision follows a quarter-point reduction in December, marking the third consecutive cut aimed at tempering inflation and supporting economic growth.}

_{Recent minutes from the December meeting reveal a cautious approach among Fed officials, with some advocating for a pause to assess the impact of prior cuts. Concerns over persistent inflation and potential economic shifts, including proposed tariffs from the incoming Trump administration, have influenced this stance.}

_{Christopher Waller, a top Fed official, has expressed support for additional rate cuts in 2025, contingent upon inflation trends and labor market stability. He downplays the inflationary impact of proposed tariffs, suggesting they won't significantly alter monetary policy.}

_{Market analysts anticipate a gradual reduction in rates throughout 2025, with projections indicating a year-end target near 4%. This outlook reflects the Fed's commitment to balancing economic growth with inflation control, while navigating uncertainties posed by new fiscal policies.}

_Politics

_{Justice Department Targets Landlords' Algorithmic Rent-Setting Scheme}

_{In a bold move to tackle rising housing costs, the U.S. Department of Justice (DOJ) has filed a lawsuit against six major landlords, accusing them of using algorithmic pricing tools to artificially inflate rents nationwide.}

_{The landlords—Greystar Real Estate Partners, Blackstone's LivCor, Camden Property Trust, Cushman & Wakefield's Pinnacle, Willow Bridge Property, and Cortland—allegedly employed software from RealPage, a real estate tech firm, to share sensitive rental data and coordinate pricing strategies. This practice is said to have suppressed competition and driven up rents, impacting millions of American renters.}

_{The DOJ contends that RealPage's algorithm enabled these companies to exchange confidential information, such as rent and occupancy rates, renewal rates, and future pricing plans, leading to higher rents than would be possible in a competitive market. This lawsuit marks the first time the DOJ has targeted algorithmic collusion in the housing sector.}

_{In response to the lawsuit, Cortland has agreed to cooperate with the DOJ and enter into a settlement to end the use of common rental pricing algorithms and competitively sensitive data to set rents.}

_{Halo Communities News}

_{After receiving feedback from a range of large groups, we are thrilled to announce a significant increase in our fund size—from $30 million to $300 million. This expansion represents our commitment to addressing the urgent need for affordable housing and creating lasting impacts in communities. With this enhanced funding, we aim to acquire, develop, and redevelop over 7,500 affordable housing units. These efforts have the potential to improve the quality of life for more than 150,000 individuals, providing them with safe, stable, and affordable places to call home. We are grateful for the input and support that have helped shape this vision and look forward to delivering meaningful change together.}