Too much information? More like not enough.
The U.S. Federal Trade Commission has temporarily halted the CoStar Group’s plans to purchase the apartment rental site ForRent.com, until both companies provide more information about the deal. The move brings to a screeching halt the rapid clip at which CoStar, a real estate information and services company, has been acquiring competing online property sites.
The Nov. 24 Federal Trade Commission ruling in a Delaware U.S. District Court called for a delay of at least 60 days in order for the CoStar Group and ForRent.com parent company Dominion Enterprises to submit additional details regarding the $350 million acquisition.
“CoStar remains enthusiastic about its plan to acquire ForRent,” CoStar CEO Andrew Florance said in a statement issued on Monday. “Combining ForRent with the Apartments.com network will benefit renters looking to efficiently find their next home, and property managers and owners who want to access a broad and diverse base of renters for their units.”
Announced in September, the deal to purchase ForRent from Virginia-based Dominion Enterprises would expand CoStar’s Apartments.com platform while bolstering a portfolio that already includes apartmentfinder.com, Loopnet and the Spanish-language apartamentos.com.
Beside ForRent, Dominion Enterprises owns and operates ForRent.com, AFTER55.com, CorporateHousing.com and ForeRent-University.com. As of June, the websites listed 17,000 rental properties and boasted more than 3.5 million unique monthly visitors during the first half of 2017, according to the Richmond Times-Dispatch.
The ruling comes on the heels of a countersuit filed in June by the property data firm Xceligent, which accused CoStar of creating a monopoly and violating a previous FTC mandate against anticompetitive practices made in 2012 following the $860 million acquisition of Loopnet.
In that ruling, the federal agency required CoStar to sell Loopnet’s financial stake in Xceligent, which it had partnered with in 2007 prior to the CoStar acquisition. CoStar faced a similar delay during that acquisition, but the deal was eventually closed in 2012, according to reports.
In his statement, Florance insisted the latest FTC request is common in the course of a merger or acquisition transaction and that it would be resolved immediately.
Email Jotham Sederstrom