PRESS RELEASE DETAIL


Oct 26, 2011

CoStar Group Acquires Atlanta-Based Virtual Premise, Inc., Leading SaaS Provider of Lease Management Tools

WASHINGTON, Oct. 26, 2011 -- CoStar Group, Inc. (Nasdaq:CSGP - News), commercial real estate's leading provider of information and analytic services, today announced the acquisition of Virtual Premise, Inc., a leading independent provider of SaaS-based real estate information management solutions. The Atlanta-based, privately held company develops and hosts real estate management software and provides lease abstraction services for over 250 major corporations, commercial real estate brokers, retailers and property owners. Virtual Premise's subscription-based clients use the SaaS (software as a service) solutions to increase the efficiency of real estate management processes, reduce occupancy costs and improve utilization of real estate assets. The company's lease administration module allows clients to manage and monitor lease expirations, rental payments, renewal options and transactions and projects.

  • Strategic acquisition will combine industry leading lease management tools with CoStar's comprehensive information platform
  • Virtual Premise sales are expected to benefit from CoStar's large sales force
  • Virtual Premise manages approximately $1 billion a month in rent payments

WASHINGTON, Oct. 26, 2011 -- CoStar Group, Inc. (Nasdaq:CSGP - News), commercial real estate's leading provider of information and analytic services, today announced the acquisition of Virtual Premise, Inc., a leading independent provider of SaaS-based real estate information management solutions. The Atlanta-based, privately held company develops and hosts real estate management software and provides lease abstraction services for over 250 major corporations, commercial real estate brokers, retailers and property owners. Virtual Premise's subscription-based clients use the SaaS (software as a service) solutions to increase the efficiency of real estate management processes, reduce occupancy costs and improve utilization of real estate assets. The company's lease administration module allows clients to manage and monitor lease expirations, rental payments, renewal options and transactions and projects.

M. Andrew Thomas, Virtual Premise's President and Chief Operating Officer since 2001, will continue to lead the Virtual Premise team of approximately 50 professionals based in Atlanta as a division of CoStar Group. CoStar plans to combine Virtual Premise with its Atlanta-based operations, growing its Atlanta presence to nearly 100 employees.

"We are excited about working with Andy Thomas and the team at Virtual Premise," said Frank A. Carchedi, Senior Vice President of Corporate Development at CoStar. "The combination of CoStar data and design elements with Virtual Premise's products are expected to lead to more efficiency for brokers, greater transparency and more transactions. We also believe we can significantly grow Virtual Premise's revenue by building upon their sales force of seven individuals in two locations with CoStar's sales force of approximately 200 people in 30 locations."

"The addition of Virtual Premise is expected to provide substantial value to CoStar's significant base of commercial real estate brokerage clients, which they in turn can pass on to their clients," Carchedi added. "We also see a tremendous opportunity to grow market share in the lease management space, which is very fragmented with over two dozen participants, all with less than 5% market share. Lease data hosted by Virtual Premise will remain strictly confidential."

"Our software manages over $1 billion in rent payments a month," said Thomas. "Our clients use our software to simplify the management of their real estate assets. We believe that combining Virtual Premise with CoStar will enhance the value we provide our customers who desire comprehensive, real-time property and market intelligence that allows them to move quickly and make decisions more easily."

Prior to joining Virtual Premise in 2001 as COO, Thomas was with Equitable Real Estate for 12 years where he served as an Executive Vice President. As Managing Director of RealEstate.com, he oversaw the launch of its commercial website, negotiating agreements with strategic partners in both the real estate and technology arena. As Managing Director of Portman Holdings, he was responsible for fostering relationships with capital sources and developing capital strategies for Portman's worldwide development projects. Thomas received an MBA from the University of Pennsylvania's Wharton School and a BS in Building Construction from the Georgia Institute of Technology.

CoStar acquired Virtual Premise in an all cash transaction valued at approximately $17.0 million net of cash acquired. A more detailed discussion of the acquisition is planned for CoStar's Third Quarter Financial Results Conference call at 11:00 am EDT on Thursday, October 27, 2011.

About Virtual Premise

Virtual Premise, Inc. is a leading SaaS provider of real estate information management solutions for corporations, retailers, landlords and commercial real estate service providers. With Virtual Premise, companies have a smart, easy way to collect, manage and report on complex real estate information from anywhere, at any time. Virtual Premise technology solutions include strategy and analytics, portfolio management, lease management, lease administration, project management, transaction management, and document management. Virtual Premise also offers a wide range of supporting services to include lease abstracting, document management services, data validation, due diligence support, and best practices consulting. In addition, the company is taking a thought leadership role in preparing its solution for the upcoming FASB lease accounting changes. For more information visit www.virtualpremise.com.




'