CoStar Group announced an agreement to acquire Apartment Finder and pair the apartment listing portal with CoStar's Apartments.com service, operating the two as separate, complementary services, both powered by CoStar's multifamily information. 

CoStar is buying the Apartment Finder business from Norcross, GA-based Network Communications, Inc. for $170 million, which amounts to approximately seven times the company's EBITDA for its fiscal year ended March 31, 2015. CoStar said it expects the acquisition to close within 90 days after completing customary closing conditions. It expects the acquisition to be accretive in 2016, and to achieve run-rate synergies of $20 million within 18 months after the acquisition closes. 

Apartment Finder's service offerings include digital advertising on ApartmentFinder.com, which had about 13,400 properties advertised on its website at the time the deal was announced. Apartment Finder is considered one of top five apartment rental listing marketplaces based on advertising revenue. 

By offering two online marketing solutions as separate brands, CoStar believes managers and owners of apartment properties will benefit from greater exposure options for their listings and more effective lead targeting. 

The strategy is similar to other big rental site operators: Zillow Group owns and operates Zillow, Trulia and the rentals-focused site HotPads, while RentPath Inc. operates Apartment Guide, Rent.com and Rentals.com 

After integrating the back ends of the two sites, CoStar expects to leverage the same research, systems, support and sales platform to power both Apartments.com and ApartmentFinder.com, resulting in significant cost savings and operating efficiencies. 

"Over the past year we have transformed Apartments.com into one of the fastest growing industry websites, and we are excited to do the same for Apartment Finder," stated CoStar Group Founder and Chief Executive Officer Andrew C. Florance, in announcing the acquisition agreement. 

Since acquiring Apartments.com in April 2014, CoStar Group redesigned and launched a new, more consumer-centric website that now offers more than 550,000 current availabilities online, significantly more than the 18,200 listings when CoStar bought it. 

CoStar also kicked off a major search engine marketing campaign to help drive traffic to the Apartments.com website, and boosted consumer awareness of the site through a national marketing campaign featuring acclaimed actor Jeff Goldblum. 

The dual marketing initiatives helped Apartments.com vault to the number one apartment rental site in traffic in March, according to internet traffic authorities comScore, Compete.com, Experian Hitwise and Alexa. Traffic to Apartments.com more than doubled in March 2015 compared to March 2014 with 15 million visits and 7 million unique visitors. Leads to property managers and owners are up nearly 67% year-over-year. 

Apartment Finder's approximately 400 employees will become CoStar employees. "I am looking forward to working with the great team at Apartment Finder and welcoming them to the CoStar family," said CoStar CEO Florance. "We are all dedicated to building and growing commercial real estate's premier online apartment platform and strengthening CoStar's leadership position in the $2 trillion U.S. multifamily asset class."