CoStar Group, Inc. (NASDAQ: CSGP), the leading provider of
commercial real estate information, analytics and online
marketplaces, announced today that it has reached an agreement to
acquire Homesnap, Inc. for $250 million in cash.
Homesnap is an industry-leading online and mobile software
platform that provides user-friendly applications to optimize
residential real estate agent workflow and reinforce the
agent-client relationship. Over 300,000 agents nationwide use the
application an average of 30 times each month. Those 300,000 agents
are also the nation’s most productive, selling the majority of
homes in the US. The platform enjoys high growth and engagement as
the number of active monthly users has grown at a compounded annual
growth rate of over 40% since 2016, while marketing product sales
have risen over 75% per year over that same period. Supported by a
consortium of hundreds of the country’s largest multiple listing
services (MLSs), over 1.1 million real estate agents have access to
Homesnap Pro. These agents represent over 90% of the residential
real estate agents and listings in the United States. With the
support of this impressive consortium, Homesnap’s public
residential real estate portal showcases 1.3 million active
property listings. Tens of millions of home shoppers use the
Homesnap website and app to look for a home.
“The acquisition of Homesnap will enable us to enter a new space
and expand the total addressable markets in which we can compete,”
said CoStar Group founder and CEO, Andy Florance. “The estimated
value of commercial real estate assets in the U.S. is $16 trillion.
With the new addition of clients and information covering 90% of
the estimated $27 trillion dollar U.S. residential real estate
market we are almost tripling the size of our addressable markets.
Over the past thirty years, CoStar has become the leading real
estate technology platform by working in partnership with
commercial real estate brokers to serve their needs for data,
analytics and advertising exposure for their property listings.
Similarly, Homesnap works in very close partnership with
residential agents to serve their needs for data, analytics and
advertising exposure for their property listings. We will continue
to differentiate our residential real estate portal and solutions
by working solely to help agents market their listings and their
brands, which is in sharp contrast to other portals that
increasingly advertise on top of agent listings and offer brokerage
services directly.”
The addition of Homesnap’s complementary offerings will
quadruple the number of professional, paying brokers and active
agent users on the CoStar Group U.S. platforms from approximately
100,000 today to over 400,000. The number of U.S. property listings
available across CoStar’s brands will double from approximately
1.35 million today to over 2.6 million.
“Homesnap has great relationships, data, software, and tools for
residential real estate professionals that are complementary to our
existing offerings,” continued Florance. “The tools and
functionality developed by Homesnap for residential property
agents, such as lead generation, client collaboration, and digital
advertising, have direct applicability to commercial brokers. Our
goal is to make these enhanced capabilities available to all of our
audiences. Combining forces with Homesnap is also expected to
enable us to expand and deepen our collaboration with MLSs
nationwide. A very large percentage of CoStar’s clients such as
investors, banks, government agencies, appraisers, suppliers, and
brokerage firms are active in both commercial and residential real
estate, so we believe that they would welcome a more comprehensive
solution for their needs across all real estate segments.”
“Homesnap has spent years building tools that reinforce the
agent-client relationship and arm both home buyers and agents with
the data and software they need to find homes and do their jobs,”
said John Mazur, CEO of Homesnap. “In addition, residential
property agents spend an estimated $10 billion every year on
software and marketing, while influencing a further $21 billion of
spending in adjacent markets, such as lending, insurance and
relocation services. We are excited to join CoStar Group and
leverage their 30 years of knowledge and experience in property
data, software and marketing to take advantage of this significant
growth opportunity.”
Homesnap is also headquartered in the Washington, D.C. area,
employs approximately 150 people and is projected to achieve
approximately $40 million of revenue for the full year 2020,
representing revenue growth of approximately 45% compared to the
full year 2019. The transaction is expected to close in 2020,
subject to customary closing conditions and regulatory review.
The preceding forward-looking statements reflect CoStar Group’s
expectations as of November 22, 2020. We are not able to forecast
with certainty whether or when certain events, such as
acquisition-related costs, the exact timing of the closing of the
acquisition, or the exact amounts or timing of any investments
related to the acquisition will occur. Given the risk factors,
uncertainties and assumptions discussed above, actual results may
differ materially. Other than in publicly available statements,
CoStar Group does not intend to update its forward-looking
statements until its next quarterly results announcement.
About CoStar Group, Inc.
CoStar Group, Inc. (NASDAQ: CSGP) is the leading provider of
commercial real estate information, analytics and online
marketplaces. Founded in 1987, CoStar conducts expansive, ongoing
research to produce and maintain the largest and most comprehensive
database of commercial real estate information. Our suite of online
services enables clients to analyze, interpret and gain unmatched
insight on commercial property values, market conditions and
current availabilities. STR provides premium data benchmarking,
analytics and marketplace insights for the global hospitality
sector. Ten-X provides a leading platform for conducting commercial
real estate online auctions and negotiated bids. LoopNet is the
most heavily trafficked commercial real estate marketplace online
with over 7 million monthly unique visitors. Realla is the UK’s
most comprehensive commercial property digital marketplace.
Apartments.com, ApartmentFinder.com, ForRent.com,
ApartmentHomeLiving.com, Westside Rentals, AFTER55.com,
CorporateHousing.com, ForRentUniversity.com and Apartamentos.com
form the premier online apartment resource for renters seeking
great apartment homes and provide property managers and owners a
proven platform for marketing their properties. CoStar Group’s
websites attracted an average of approximately 69 million unique
monthly visitors in aggregate in the third quarter of 2020.
Headquartered in Washington, DC, CoStar Group maintains offices
throughout the U.S. and in Europe, Canada and Asia with a staff of
over 4,300 worldwide, including the industry’s largest professional
research organization. For more information, visit
www.costargroup.com.
About Homesnap
Based in Bethesda, MD, Homesnap was founded in 2012 to provide
residential real estate agents and consumers with an intuitive
technology that facilities buying and selling homes. Homesnap’s
flagship product, Homesnap Pro, is a free software application for
real estate agents to view and manage property listings,
communicate with clients, receive market alerts and schedule
showings on their mobile devices. Homesnap collects data from over
500 data sources and has subscription service agreements with
approximately 240 MLSs who provide data and subscription revenue to
Homesnap in exchange for free agent access to Homesnap Pro.
Homesnap also provides marketing products through its mobile
application that agents can use to promote their listings, as well
as a premium product called Homesnap Pro+, which provides agents
with enhanced functionality and business intelligence through
individual subscription agreements. The Homesnap platform contains
approximately 1.3 million active property listings, including
residential, commercial, land and other property types, covering
approximately 90% of active listings. The company also aggregates
information on property taxes, mortgages, individual property
parcels, neighborhood schools and other property data elements.
This news release and the Company’s conference call contain
“forward-looking statements” within the meaning of the Private
Securities Litigation Reform Act of 1995. Such statements include,
but are not limited to, statements about CoStar Group's plans,
objectives, expectations, beliefs and intentions and other
statements including words such as “hope,” “anticipate,” “may,”
“believe,” “expect,” “intend,” “will,” “should,” “plan,”
“estimate,” “predict,” “continue” and “potential” or the negative
of these terms or other comparable terminology. Such statements are
based upon the current beliefs and expectations of management of
CoStar and are subject to many risks and uncertainties. Actual
results may differ materially from the results anticipated in the
forward-looking statements and the assumptions and estimates used
as a basis for the forward-looking statements. The following
factors, among others, could cause or contribute to such
differences: the possibility that the acquisition of Homesnap does
not close when expected or at all; the possibility that the parties
are unable to obtain regulatory approval, or the risk that any
actions required to be taken in order to receive regulatory
approval may impact the expected benefits of the transaction; the
risk that the businesses of Homesnap and CoStar may not be combined
successfully or in a timely and cost-efficient manner; the risk
that business disruption relating to the Homesnap acquisition may
be greater than expected; the risk that the acquisition does not
produce the expected benefits or results for CoStar, Homesnap or
their customers and advertisers, including expanded and deeper
collaboration with MLSs nationwide and as otherwise stated in this
release; the risk that Homesnap revenues and revenue growth for
2020 will not be as stated in this press release; the risk that the
combination and integration of Homesnap will disrupt CoStar Group's
or Homesnap’s operations or result in the loss of customers or key
employees; uncertainty surrounding the impact of the COVID-19
pandemic, including volatility in the international and U.S.
economy, worker absenteeism or decreased productivity, quarantines
or other travel or health-related restrictions; the length and
severity of the COVID-19 pandemic; the pace of recovery following
the COVID-19 pandemic; and government and private actions taken to
control the spread of COVID-19. Additional factors that could cause
results to differ materially from those anticipated in the
forward-looking statements can be found in CoStar Group’s filings
from time to time with the Securities and Exchange Commission,
including in CoStar Group’s Annual Report on Form 10-K for the year
ended December 31, 2019, and CoStar Group’s Quarterly Reports on
Form 10-Q for the quarters ended March 31, 2020, June 30, 2020 and
September 30, 2020, each of which is filed with the SEC, including
in the “Risk Factors” section of those filings, as well as CoStar
Group’s other filings with the SEC available at the SEC’s website
(www.sec.gov). All forward-looking statements are based on
information available to CoStar Group on the date hereof, and
CoStar Group assumes no obligation to update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise.
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version on businesswire.com: https://www.businesswire.com/news/home/20201122005077/en/
Investors Scott Wheeler Chief Financial Officer (202)
336-6920 swheeler@costar.com Sarah Spray Investor Relations (202)
346 6394 sspray@costar.com
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