LoopNet operator CoStar Group Inc. has an agreement to acquire Apartments.com from Classified Ventures LLC, for $585 million in cash.
As a provider of commercial real estate information and analytics, CoStar collects details on availability, rents, key contacts, comparable sales, photographs and building characteristics on hundreds of thousands of apartment buildings.
Apartment shoppers image via Shutterstock.
In announcing the acquisition of Apartments.com, CoStar Group CEO Andrew Florance said the CoStar database will add richer content to Apartments.com, boosting consumer traffic and leads for customers.
The company thinks property owners and managers using Apartments.com will want to use CoStar's multifamily information and analytics to help them understand market dynamics.
"We also believe CoStar's huge database of apartment owners and managers can be a valuable source of new leads for the Apartments[.com] sales force," Florance said in a statement.
Apartments.com -- which operates ApartmentHomeLiving.com and RentalHomesPlus.com -- has 140 employees working in sales, including 75 U.S. ad field reps.
Apartments.com, ApartmentHomeLiving.com and RentalHomesPlus.com together generated an average of 7 million unique visitors a month last year.
Apartments.com was the third-most visited real estate portal devoted to rentals in January, behind Apartment Guide and Rent.com, according to Experian Marketing Services.
In addition to LoopNet, CoStar Group also owns commercial property sites CityFeet and Showcase. Together, the three sites attract more than 5 million monthly unique visitors, the company said.
Other CoStar properties include LandsofAmerica and LandAndFarm, marketplaces for rural land and farm properties that attract 1.7 million unique monthly visitors; and BizBuySell and BizQuest, marketplaces for small businesses for sale that claim more than 1 million unique monthly visitors in total.
CoStar will take on considerable debt to finance the deal -- the company has commitments for a $400 million term loan and a $225 million revolving credit facility that will be used with cash on hand to fund the acquisition. Those loans also refinance the company's existing debt and provide working capital.
CoStar acquired LoopNet.com in 2011 in an $860 million deal that doubled the size of CoStar's subscriber base to 160,000 and created a company with more than $300 million in annual revenue.
Apartments.com is owned by Classified Ventures, a joint venture of Tribune Co., A. H. Belo Corp. Gannett Co. Inc., The McClatchy Co. and The Washington Post Co., which reportedly began shopping the site around last fall.
The boards of directors of CoStar Group and Classified Venture have unanimously approved the deal, which is expected to close in the second quarter.