Real Capital Analytics, the data firm that tracks global commercial real estate sales and trends, secured $115 million in growth equity to fund expansion into overseas markets and buy out a minority stake owned by Daily Mail Group Trust. The investment included Series B equity as well as debt, and is one of the largest bets on a real estate technology company.
The New York-based firm, which launched in 2000 and is now valued at close to $220 million, received the investment from Philadelphia-based Susquehanna Growth Equity, a deal that closed after just 60 days, its founder and chief executive Bob White told The Real Deal.
Daily Mail Group Trust (DMGT), which invested heavily in the space for about a decade but has recently been winding down its bets, paid $7.5 million for a 40 percent stake in RCA in 2007. The recent funding valued that stake at $89 million.
White said that he had sought a new investor that could “move a bit quicker” on acquisition and growth opportunities and is “more aligned with RCA.”
“They [DMGT] are a big company with a lot of different businesses, and, quite frankly, I wanted to get some partner that would be more supportive of RCAs growth,” White said.
He said the remaining $26 million would be used for investments in data firms overseas, primarily in Europe and Asia, where the company has made bets on three early-stage companies. In a statement, Brian Feldman, managing director at Susquehanna, said the firm “could not be more excited to support RCA as it continues to transform the commercial real estate industry.”
The real estate data sector has seen a torrent of dealmaking over the past year. CoStar Group, the real estate data giant with a current market cap of over $18 billion, acquired Cozy and Realla last year. Earlier this year, Moody’s Analytics launched a new portal named the Reis Network, that provides tools offered by a multitude of real estate data firms, including CompStak and Rockport VAL. That platform is built around Moody’s $278 million acquisition of commercial real estate data company Reis in September last year.
VTS, a cloud-based leasing portfolio management software firm, last month claimed that it was worth $1 billion after securing a $90 million funding round led by Brookfield Asset Management and GLP.
And last month, a new operating company, Lightbox, acquired two firms valued over $200 million, bringing its total number of acquisitions to four. Lightbox is majority-owned by Silver Lake, a tech-focused private equity investor with $45 billion under management, and Battery Ventures, a Boston-based investment firm with almost $7 billion under management.
RCA has long been an acquisition target for private-equity firms and data companies. When asked if he saw potential to be acquired by one of the larger firms, including Lightbox, White said RCA “certainly could be,” but added that he had multiple partnerships with other firms in the sector.
The Susquehanna deal was attractive, he said, as it allowed him to retain majority ownership and remain in charge.
“I love it. I’ve had plenty of opportunities to sell out, but I wanted to stay involved,” he said. “And in control.”