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CoStar’s bet on Apartments.com is paying off

CEO says firm is working through pipeline of potential acquisitions

CoStar CEO Andy Florance (Credit: CoStar via YouTube and iStock)
CoStar CEO Andy Florance (Credit: CoStar via YouTube and iStock)

CoStar Group Inc. took in a record $59 million in sales bookings companywide in the second quarter, marking a 32 percent increase year-over-year and fueling a 16 percent growth in revenue.

The bookings boost stemmed from a 122 percent surge in bookings on Apartments.com, the company’s rental listing platform, according to CoStar’s second-quarter earnings report, released Tuesday.

The real estate data firm saw $344 million revenue in the second quarter. Net income totaled $63 million and EBITDA was $94 million, both metrics also up year over year.

Last year, CoStar raked in $1.2 billion in revenue. The firm on Tuesday raised its 2019 revenue guidance, projecting to take in $1.382 to $1.390 for the full year.

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LoopNet.com, the firm’s commercial real estate listings platform, hasn’t seen the same monetization of its ads like Apartments.com, CEO Andrew Florance said during a Tuesday earnings call with investors. But there are plans to change that, including selling new advertising packages and adding features like virtual walk-throughs and videos of properties.

Florance also discussed CoStar’s second-quarter acquisition of Off Campus Partners, a student housing listing service that has contracts with 132 universities. In 2018, CoStar bought Cozy Services and U.K. commercial real estate marketplace Realla.

There may be more acquisitions in the future. The firm’s acquisition pipeline is “active,” Florance said.

“At any given point, we’re looking closely at probably a dozen companies,” he said. “We’re continuing to be selective.”

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