Costar Group (CSGP) Reports Acquisition of Homes.com for $156M from Dominion Enterprises
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CoStar Group, Inc. (NASDAQ: CSGP), the leading provider of commercial real estate information, analytics and online marketplaces, announced today that it has reached a definitive agreement to acquire Homes.com, a division of Dominion Enterprises, for $156 million in cash.
Homes.com is a well-recognized residential property listing and marketing portal that supports over 500,000 residential agents and brokers in the home sale process. Approximately 5 million people visit the Homes.com website each month to search nearly 1.8 million residential property listings. Homes.com provides advertising and marketing services to residential brokers and agents based on listing feeds that cover more than 90% of all Multiple Listing Services (MLS) subscribers in the United States. The company is headquartered in Norfolk, Virginia.
“We are excited to welcome the Homes.com team to the CoStar family,” said Andrew C. Florance, Founder and Chief Executive Officer of CoStar Group. “We believe that the acquisition of Homes.com is highly complementary alongside Homesnap, the industry-leading workflow and marketing platform for residential real estate agents that we acquired in December last year. The combination of Homes.com’s online portal and consumer traffic with Homesnap’s powerful mobile tools and highly effective agent marketing solutions has the potential to create a differentiated service that uniquely focuses on selling a house faster and at a better price, rather than just trying to take agent fees.”
“Unfortunately,” continued Florance, “current residential listing sites do not serve the interests of homeowners or their agents as they focus on selling advertisements on top of agent listings and increasingly offer competing brokerage services. These sites generate a portion of their revenue from directing potential homebuyers away from the listing agents to unrelated buyer agents that are advertising on top of listing agent listings. This is a practice we plan to no longer continue. Our plan in bringing Homesnap and Homes.com together is to help agents market their listings in support of the ‘your listing, your lead’ philosophy – which stands in contrast to most players in the industry.”
“The Homes.com team and I are looking forward to working with our new colleagues at CoStar,” said Dave Mele, President of Homes.com. “Together we will be dedicated to growing the Homes.com brand and building innovative solutions that expand the marketing options available to consumers and their agents.”
The transaction is expected to close in the first half of 2021, subject to customary closing conditions and regulatory review. We anticipate the acquisition of Homes.com will contribute approximately $5-10 million in incremental revenue to CoStar Group in the second half of 2021, subject to transaction timing. CoStar Group plans to provide additional information about the Homes.com acquisition during the first quarter 2021 financial results conference call scheduled for April 27, 2021.
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