DMG Information Inc. has bought out LoopNet’s ownership stake in commercial real estate tracker Xceligent, which provides property listings databases and information in the Springfield market.
With the transaction, which is pursuant to a Federal Trade Commission consent order intended to create a national competitor to the recent merger of CoStar Group and LoopNet, DMGI is funding Xceligent’s expansion to 65 major markets nationwide in the next three years. The Springfield area is among roughly 30 markets in which Xceligent currently researches and lists commercial properties.
In addition, Xceligent’s founders last week finalized a repurchase of the firm’s outstanding shares.
“This will completely change the landscape of the industry as we know it,” founder and CEO Doug Curry said in a news release. “For years, those who use commercial real estate information in metro areas like Chicago, New York, Washington, D.C., Miami, Seattle and other top tier markets have had to rely, for the most part, on a single source. Now, they will have a competitive, cost-effective alternative.”
Xceligent’s new partner, DMGI, is a U.S.-based subsidiary of British media and data conglomerate Daily Mail & General Trust PLC. Xceligent recently has completed the Atlanta market launch, physically inspecting 40,000 commercial properties, and has begun research in the next two top tier cities, the release said.
LoopNet’s ownership stake in Xceligent was called into question by the FTC when CoStar made an $860 million buyout offer to LoopNet. The FTC alleged the merger would violate anticompetitive laws, and last month the governmental agency set conditions on the deal.
“The listings databases and information services provided by these companies are critical to their customers in the commercial real estate industry,” said Richard Feinstein, director of the FTC’s Bureau of Competition, in a news release. “By maintaining Xceligent as an independent competitor and ensuring Xceligent’s ability to grow and expand, the FTC’s settlement order will foster continued competition in these markets.”
The FTC’s proposed order states:
- CoStar-LoopNet will sell the URL “CommercialSearch.com” to DMGI and transfer information to assist Xceligent in expanding coverage to additional metropolitan areas;
- CoStar will lift noncompete provisions and allow customers in longer-term contracts to terminate them early;
- CoStar will refrain from bundling its products together in ways that could impede its competitors; and
- CoStar-LoopNet will notify the FTC before acquiring any firm that gathers, markets or sells commercial real estate information in the United States in the next 10 years.
“When the CoStar-LoopNet merger was first announced, real estate companies across the country reached out to us to see if we could quickly match the footprint of the combined entity,” Curry said in a separate release. “With their vision of the commercial real estate sector as well as their experience in growing information companies and financial resources, it was evident DMGI was the ultimate partner for Xceligent and the industry.”[[In-content Ad]]
