WASHINGTON, DC–CoStar Group has announced it has launched a $750 million public offering of common stock, which includes a 30-day option for underwriters to purchase an additional $112.5 million in the stock. J.P. Morgan, Goldman Sachs & Co. LLC, Citigroup, BofA Merrill Lynch, SunTrust Robinson Humphrey and Wells Fargo Securities are acting as joint-bookrunning managers for the offering.
CoStar says it will use the net proceeds to fund any strategic acquisitions it may make, to finance the growth of its business and for working capital and other general corporate purposes.
The offering follows an announcement earlier this month that it was acquiring the Norfolk, Va.-based ForRent, a division of Dominion Enterprises — which had some 17,000 properties advertised on its websites as of June 2017 — for $350 million in cash and $35 million in company stock.
The deal was primarily a digital advertising play for CoStar; this is ForRent's primary service via a network of four multifamily websites that includes ForRent.com, AFTER55.com, CorporateHousing.com and ForRentUniversity.com. Through the first six months of 2017, these sites generated over 47 million visits and an average of 3.5 million unique monthly visitors. “ForRent advertisers' properties will be featured on Apartments.com after the transaction closes increasing their exposure by approximately 500%,” CoStar CEO Andrew C. Florance said at the time in a prepared statement.
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Erika Morphy
Erika Morphy has been writing about commercial real estate at GlobeSt.com for more than ten years, covering the capital markets, the Mid-Atlantic region and national topics. She's a nerd so favorite examples of the former include accounting standards, Basel III and what Congress is brewing.
