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RealPage growing property management business by buying Buildium for $580 million

Will be RealPage’s 8th acquisition since January 2017, at least

After acquiring at least seven different companies from January 2017 through October 2018, RealPage is back at it again.

RealPage, a provider of software and data analytics to the real estate industry, announced this week that it reached a deal to acquire Buildium, a real estate property management solution provider, for $580 million in cash.

According to RealPage, the company plans to combine its own property management capabilities with those of Buildium to “target smaller multifamily, single-family, associations (HOA and condo) and commercial real estate market segments.”

Those areas of the real estate market represent as many as 50 million units, and RealPage views that segment as a “significant growth opportunity.”

Buildium is currently in use by more than 17,000 customers in more than 50 countries and has approximately 2 million residential units under management.

RealPage, meanwhile, currently serves 16.8 million units worldwide.

According to RealPage, the company plans to expand on Buildium’s property management platform by “incorporating ‘click-on’ capabilities that: improve the renter leasing and living experience, improve the recovery of utility fees, enhance payment processing capabilities, and expand insurance offerings.”

And by delivering more value to the smaller operators in the real estate space, RealPage believes it is positioned to drive significant revenue growth through this acquisition.

“The SMB market segment represents a tremendous growth opportunity for RealPage. This is an area where technology is underutilized and currently served by myriad point products. Buildium in concert with RealPage enables us to reach deeper into that market, with a best-in-class platform backed by data science,” RealPage CEO and Chairman Steven Winn said.

As stated above, RealPage intends to pay $580 million in cash to acquire Buildium.

According to RealPage, Buildium generated approximately $50 million in revenue during the 12 months that ended on Sept. 30, 2019. The company also has an expected run-rate of approximately $60 million by the end of this year, representing over 30% year-over-year growth.

“This is a fantastic time for us to join forces with RealPage,” Buildium CEO Chris Litster said. “Our shared vision around innovation, simplicity and a commitment to stressing service to our clients will enable them to thrive and grow as well as deliver unmatched value for their investors, owners and residents alike. I would like to thank our board and Sumeru Equity Partners for their direction and support through this process.”

Sumeru Equity Partners is Buildium’s majority owner and its lead investor.

With the $580 million RealPage plans to spend for Buildium, the company’s total outlay for acquisitions in the last two years will be north of $1.5 billion.

Last October, the company agreed to acquire software-as-a-service company Rentlytics for $57 million. Prior to that, RealPage expanded its apartment data offerings by acquiring Axiometrics, a provider of apartment market data, for $75 million.

Then, RealPage acquired Lease Rent Options and related assets for $300 million in cash.

Later, RealPage announced that it was acquiring American Utility Management, a provider of utility and energy management solutions for the multifamily housing industry, for $70 million.

Then, RealPage acquired “substantially all of the assets” of On-Site Manager for approximately $250 million; along with ClickPay, an electronic payment platform servicing 2.3 million units across the multifamily, HOA, condominium and co-op segments of real estate, in a separate $218 million deal.

And, RealPage also spent $100 million to acquire LeaseLabs, a provider of digital marketing services and software.

Add it all up and RealPage has spent more than $1.5 billion in less than two years to significantly grow its business. And the company will soon add Buildium into the fold.

“We are really excited about the Buildium acquisition due to the significant market opportunity we can pursue together, the strength of their platform and customer experience, the complementary nature of our platforms, data focus and shared customer-focused culture,” RealPage Chief Financial Officer Tom Ernst said.

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