Commercial real estate data provider CoStar Group Inc CSGP will acquire Homesnap Inc for $250 million. The all-cash deal is expected to close this year.
What Happened: The acquisition is CoStar’s first venture in the residential real estate data business, according to the Wall Street Journal.
With over 300,000 agents accessing its online and mobile platform 30 times a month, Homesnap’s monthly active userbase has grown at a CAGR of 40% since 2016. Approximately 1.1 million real estate agents are onboard the Homestop Pro, the company's agent-only portal showcasing Multiple Listing Services.
Post-acquisition, CoStar says it will continue to focus on agent-facing services instead of competing for a revenue share from the brokerage business.
Why Does It Matter: CoStar anticipates that Homesnap could generate around $40 million in annual revenues this year, representing a 45% year-over-year growth rate.
“The estimated value of commercial real estate assets in the U.S. is $16 trillion," CoStar CEO Andy Florance said in a statement. "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.”
Presently, CoStar lists around 1.35 million properties in the U.S. The management forecasts this number to double to over 2.6 million listings due to its complementary offerings.
Price Action: CoStar stock closed 0.30% lower at $892.06 per share on Friday.
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