WASHINGTON, DC—CoStar Group has announced that it is acquiring Ten-X for $190 million in cash.
When the acquisition is complete, CoStar will have an end-to-end real estate platform that combines LoopNet and CoStar's online audience of buyers with Ten-X's online auctions for both performing and distressed assets, said CoStar Group CEO Andrew Florance in prepared remarks. "In the aftermath of the economic disruption which is being caused by the global pandemic, we believe that the volume of distressed properties coming to market will surge and that this combined platform will support the market's recovery," he added.
Ten-X launched in 2009 as a digital transaction platform to liquidate the large volume of distressed commercial real estate assets that came on the market during the Great Recession. Since the, the company has become a major platform for digital commercial real estate transactions with close to $24 billion dollars of sales executed. While Ten-X initially focused on distressed assets, non-distressed sellers and brokerage firms also use Ten-X to transact properties. Fannie Mae, Bank of America, JP Morgan Chase, Blackstone, Starwood, BlackRock, Capital One, MetLife, LNR, UBS, PNC, and SunTrust are among the platform's users.
Once the acquisition is complete, CoStar Group will integrate the Ten-X digital transaction platform into both LoopNet and CoStar.
The companies expect this integrated product will boost online commercial real estate transactions.
"Today, only 1% of all commercial real estate sales transactions take place online," Ten-X CEO Steve Jacobs said in prepared remarks.
The transaction is expected to close in the third quarter of 2020, subject to customary closing conditions and regulatory review. Assuming the transaction closes in the third quarter of 2020, Ten-X is not expected to have a material impact to CoStar Group Adjusted EBITDA for the year.
Ten-X was acquired by investment funds affiliated with Thomas H. Lee Partners, L.P. and certain co-investors in September 2017, as part of a broader acquisition of a holding company that owned Ten-X, Auction.com and a business formerly known as Ten-X Homes. Following such acquisition, Ten-X was separated from the other businesses. CoStar's acquisition does not include such other businesses. Investment funds affiliated with Thomas H. Lee Partners, L.P. and certain co-investors continue to own Auction.com.
Want to continue reading?
Become a Free ALM Digital Reader.
Once you are an ALM Digital Member, you’ll receive:
- Breaking commercial real estate news and analysis, on-site and via our newsletters and custom alerts
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical coverage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
*May exclude premium content© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
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.
