FTC approves CoStar’s $250M Homesnap acquisition

Regulators looking to block CoStar’s $588M acquisition of RentPath

National /
Dec.December 17, 2020 10:21 AM
CoStar’s Andrew Florance and Homesnap’s John Mazur (CoStart; LinkedIn)

CoStar’s Andrew Florance and Homesnap’s John Mazur (CoStart; LinkedIn)

CoStar Group got federal regulators’ stamp of approval to buy residential tech provider Homesnap for $250 million, but the data giant still faces scrutiny over another acquisition that would strengthen its grip on residential listings.

CoStar said the Federal Trade Commission cleared its purchase of Homesnap after the two companies submitted the proposed merger last month. Homesnap works with multiple listing services around the country, acting as a front-end portal for agents.

In a statement, CEO Andy Florance praised the quick review and said it would allow coStar to “close this transaction quickly.”

Days after CoStar and Homesnap announced their deal last month, the FTC sued to block CoStar’s $588 million purchase of rental listing platform RentPath, which operates Rent.com and ForRent.com and filed for bankruptcy last year. In an administrative complaint, it said the deal would give CoStar too much control since it already operates Apartments.com, ApartmentFinder.com and ForRent.com.

CoStar countered that the FTC was “wrong in its assessment.”

The Homesnap acquisition is another way for CoStar to compete in the residential real estate market. It’s made $2 billion worth of acquisitions since 2014, including Apartments.com ($585 million), ApartmentFinder ($170 million), ForRent ($385 million) and Cozy Services ($68 million).

With 150 employees, it is on track to generate $40 million in revenue this year, up 45 percent year over year. More than 1.1 million agents use its free product, which it claims represents 90 percent of licensed U.S. agents.

“With the new addition of clients and information … we are almost tripling the size of our addressable markets,” Florence said in November.

In New York City, which does not have an MLS, Homesnap recently struck a deal with the Real Estate Board of New York to build out a public-facing portal for residential listings.

Earlier this week, REBNY sent a cease-and-desist letter to software developer Michael Gabriel and data partner RealPlus over a new listings platform they planned to launch called homes.nyc. The trade group said the two improperly used residential listings data from REBNY members.






    Related Articles

    arrow_forward_ios
    (iStock)
    Hot, hot, hot: Resi market sets new price records in March
    Hot, hot, hot: Resi market sets new price records in March
    (iStock)
    Homebuilder sentiment ticks up in April
    Homebuilder sentiment ticks up in April
    Andrew Florance, CEO of CoStar Group (CoStar, Homes.com)
    CoStar to buy Homes.com for $156M
    CoStar to buy Homes.com for $156M
    (iStock)
    Mortgage requests, refinancings continue to drop
    Mortgage requests, refinancings continue to drop
    Howard Hanna CEO Helen Hanna Casey and Compass CEO Robert Reffkin (Howard Hanna Casey, Getty)
    Howard Hanna accuses Compass of poaching agents, stealing trade secrets
    Howard Hanna accuses Compass of poaching agents, stealing trade secrets
    The effective rate was 1.1 percent, on average, in 2020, down from 1.14 percent in 2019. (iStock)
    Homeowners’ property taxes grew twice as fast last year
    Homeowners’ property taxes grew twice as fast last year
    HomeX founders Michael Lerner and Vincent Payen (HomeX)
    HomeX nabs $90M to connect homeowners and repair techs
    HomeX nabs $90M to connect homeowners and repair techs
    The state has opened 52 more investigations into potential fair-housing law violations tied to the Newsday report (iStock)
    Agents named in discrimination exposé face discipline from NY state
    Agents named in discrimination exposé face discipline from NY state
    arrow_forward_ios

    The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

    Loading...