WASHINGTON, D.C., Feb. 22, 2011-- CoStar Group, Inc. (Nasdaq:CSGP), commercial real estate's leading provider of information, analytic and marketing services, finalized the previously announced sale of its headquarters building at 1331 L Street, N.W. in Washington, D.C., to GLL L-Street 1331, LLC, an affiliate of Munich-based GLL Real Estate Partners GmbH, for aggregate consideration of $101 million in cash. The transaction closed on Friday, February 18, 2011. CoStar Group's headquarters will remain at the LEED-Certified, 169,429-square-foot building under a long-term lease signed with the new owner.
"We are very pleased with the sizable gain realized from the building sale, which provides a tremendous return on our initial investment," said Andrew Florance, Founder and CEO of CoStar Group. "We are also pleased to have secured a long-term lease agreement with GLL as the new owner of this trophy building. Having our headquarters in such a highly desirable downtown location within an efficient and environmentally responsible building is a great benefit for our employees and a great advantage for our Company. In addition to being able to accommodate our growth well into the future, it also enhances our ability to recruit and retain top talent here in the Nation's Capital."
Under the sale agreement, $15 million of the consideration is being held in escrow for the purpose of funding additional build-out and planned improvements for CoStar's space and for the common areas of the building. The Company expects its long-term lease-back agreement at the building will likely be accounted for as an operating lease and will result in additional rent expense in 2011. The 2011 expense impact is expected to be approximately $4.5 million to $5.0 million.
About CoStar Group, Inc.
CoStar Group (Nasdaq:CSGP) is commercial real estate's leading provider of information, analytic and marketing services. Founded in 1987, CoStar conducts expansive, ongoing research to produce and maintain the largest and most comprehensive database of commercial real estate information. Our suite of online services enables clients to analyze, interpret and gain unmatched insight on commercial property values, market conditions and current availabilities. Headquartered in Washington, DC, CoStar maintains offices throughout the U.S. and in Europe with a staff of approximately 1,500 worldwide, including the industry's largest professional research organization. For more information, visit www.costar.com.
About GLL Real Estate Partners
GLL Real Estate Partners GmbH (GLL) is a Munich-based real estate funds management group. GLL was formed in 2000 by three senior executives of HypoVereinsbank, then Germany’s largest real estate bank, in a joint venture with Italian insurance giant Assicurazioni Generali. GLL’s funds under management now exceed €4 billion with investments across Western Europe, Central Eastern Europe and the United States. Investors with the Group include pension funds, insurance companies and sovereign entities. GLL’s demonstrable investment track record combined with the extensive network of Generali and GLL’s own distinguished Advisory Board, provides a unique deal sourcing capability which has enabled GLL to build a balanced portfolio of institutional grade assets. For more information, visit www.gll-partners.com.