What is Hub and Spoke Collusion and How Does it Apply to Real Estate?

What is Hub and Spoke Collusion and How Does it Apply to Real Estate?

Hub and spoke collusion refers to an anticompetitive arrangement where a central player (the "hub") facilitates collusion among competitors (the "spokes") that might not directly coordinate with each other. In such schemes, the hub often acts as a conduit for exchanging sensitive information between the spokes, enabling them to align their prices or strategies unlawfully.

In real estate, this concept can apply to situations where a central entity, like a property management software provider, collects data from various competing property managers (the spokes) and uses it to set or recommend rental prices. By doing so, the software helps these property managers align their pricing strategies without direct communication among themselves, effectively standardizing prices across the market and potentially violating antitrust laws.

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