Join The Discussion

 

Moves by Jeb Bush add to talk of 2016 candidacy

WASHINGTON — Jeb Bush's decision to release a policy-laden e-book and all his emails from his time as governor of Florida has further stoked expectations among his allies that he will launch a presidential bid.

read more >

Ebby Halliday acquires Fort Worth’s Williams Trew

Williams Trew Real Estate of Fort Worth has been acquired by Dallas-based residential real estate brokerage Ebby Halliday Real Estate Inc.

read more >

Meridian Bank Texas parent acquired by UMB Financial for $182.5M

Kansas City, Mo.-based UMB Financial Corp., the parent company of UMB Bank, said Dec. 15 it has signed a definitive agreement to acquire Marquette Financial Companies in an all-stock transaction.

read more >

Cousins Properties to sell 777 Main tower in downtown Fort Worth

Cousins Properties Inc. has confirmed plans to sell the 777 Main office tower in downtown Fort Worth, according to a news release from the Atlanta-based real estate investment firm.

read more >

Glen Garden sale closes, distillery on tap

Firestone & Robertson Distilling Co. closed late Wednesday on its purchase of the historic Glen Garden Country Club in southeast Fort Worth, with plans to convert it into a whiskey distillery and bucolic visitor attraction.

read more >

Trulia purchase could have Zillow dominating home searches

Alex Sherman, Jeffrey McCracken and Prashant Gopal
(c) 2014, Bloomberg News


A Zillow purchase of Trulia would create a dominant search website for U.S. house hunters, reshaping an online industry the companies helped popularize.

Zillow, the largest U.S. real estate website, is seeking to buy No. 2 Trulia for as much as $2 billion in cash and stock, according to people with knowledge of the matter. An agreement may be announced as soon as next week, said one of the people, who asked not to be identified because the information is private. Talks are ongoing and may not lead to a deal.

The companies help buyers and renters find information on homes, generating revenue by selling advertising and charging Realtors to place their listings prominently. Together Zillow and Trulia had more than 85 million unique visitors in June, accounting for about 89 percent of all traffic to the 15 most- visited real estate sites tracked by ComScore. A combination would make it hard for rivals to compete, said Steve Murray, president of Real Trends in Castle Rock, Colorado.

"It's a blockbuster," said Murray, whose company provides research and consulting for the real estate industry. "What this says is, Zillow has been and has locked up the absolute dominant position in online real estate in the United States."

Seattle-based Zillow rose more than 15 percent to $145.76 a share Thursday, giving it a market value of $5.8 billion. Trulia, based in San Francisco, surged 32 percent to $53.74 a share, giving it a market value of $2 billion. Zillow may pay about two-thirds of the purchase price with its own stock, one of the people familiar with the matter said.

Katie Curnutte, a spokeswoman for Zillow, declined to comment. Matt Flegal, a spokesman for Trulia, said the company doesn't comment on speculation.

Zillow shares have climbed sevenfold since the company went public three years ago, while Trulia has tripled since its 2012 initial public offering. They compete with companies including Move, which is also publicly traded, and Redfin, which is backed by venture capital firms including Greylock Partners.

A Trulia deal would be the biggest acquisition yet for Zillow Chief Executive Officer Spencer Rascoff, according to data compiled by Bloomberg, who bought New York real estate website Streeteasy.com for $50 million last year and apartment- search site HotPads for $16 million in 2012. Earlier this month, the company purchased Retsly Software Inc., a Vancouver- based real estate software company.

Zillow's goal has long been to consolidate the industry, according to Stefan Swanepoel, a consultant and author on real estate trends.

"This follows on Zillow's aggressive path to dominate the residential real estate space and become the undisputed leader in providing consumer-convenient, one-stop home shopping information," Swanepoel said in an e-mail. "Life for all other real estate portals will become twice as hard."

Zillow and Trulia shares have surged in the past two years as the U.S. housing market rebounded from the worst crash since the Great Depression. Home prices have jumped 26 percent from a March 2012 low, according to the S&P/Case-Shiller index of 20 cities. Existing-home sales climbed in June to an eight-month high as listings increased, the National Association of Realtors reported this week.

Trulia's revenue is expected to rise 76 percent this year to about $253 million, after more than doubling the previous year, estimates compiled by Bloomberg show. Last month, the company, which is led by Chief Executive Officer Pete Flint, said it would cut some jobs and take a charge in its second quarter.

Zillow's annual revenue is expected to reach about $311 million this year, an increase of about 58 percent over last year, the data show. The company, in partnership with Yahoo! Homes!, had 53.8 million unique visitors in June, compared with about 31.6 million at Trulia, according to ComScore.

"Long-term, we see this as a two-player market and evolving much like e-commerce" with eBay and Amazon.com, Sean Aggarwal, chief financial officer at Trulia, said at the Bank of America Merrill Lynch Global Technology Conference in June.

He also described online real estate as a "very large category," with real estate professionals spending about $28 billion a year on marketing. Trulia and Zillow collectively are doing about $500 million to $600 million a year in revenue, he said, leaving $27 billion plus of "potential money" that could come into that realm over the next several years.

Neither company is currently profitable on an annual basis. No 3.-ranked Move had about 23.8 million visitors last month, ComScore's data show. ComScore's data also includes visitors to websites run by companies including Coldwell Banker and Re/Max Holdings.

Move, the parent of Realtor.com with a market value of about $579 million, declined to comment on the report of the Zillow and Trulia talks, said Mary A.C. Fallon, a spokeswoman.

Consolidation in the industry is likely because a relatively small number of real estate agents earn enough to pay advertising subscription and software-license fees to the property sites, said Brian Boero, partner at 1000Watt LLC, a real estate marketing and strategy firm in Portland, Oregon.

"They're all chasing the same Realtor wallet and it's a tough battle," Boero said. "How many real estate search sites can the category really sustain? That's an open question."

— With assistance from Dina Bass in Seattle and John Gittelsohn in Los Angeles.

< back

Email   email
hide
TCU/Baylor
Did the College Football Playoff Committee get it right?