CoStar Enters Contract To Sell Washington, DC Headquarters Building For Total Consideration Of $101 Million One Year After Acquiring Building For $41 Million

WASHINGTON, Feb. 3, 2011 (GLOBE NEWSWIRE) -- CoStar Group, Inc. (Nasdaq:CSGP), commercial real estate's leading provider of information, analytic and marketing services, announced it has entered an agreement to sell its headquarters building at 1331 L Street, N.W. in Washington, D.C., for aggregate consideration of $101 million in cash to GLL L-Street 1331, LLC, an affiliate of Munich-based GLL Real Estate Partners GmbH. CoStar Group's headquarters will remain at the LEED-Certified, 169,429-square-foot building under a long-term lease to be signed with the new owner at closing. The building sale is scheduled to close later this month.

Charts accompanying this release are available at http://media.globenewswire.com/cache/9473/file/9521.jpg http://media.globenewswire.com/cache/9473/file/9522.jpg http://media.globenewswire.com/cache/9473/file/9523.jpg

With the purchase and leaseback, a truly win-win scenario for both CoStar and GLL, the buyer will acquire an ultra-high quality asset located a few blocks from the White House and an investment that offers an attractive yield spread over U.S. Treasuries as well as the inflation protection that commercial real estate can provide. GLL has been a very active investor in the U.S. market, and has purchased a number of other trophy properties.

"GLL is a highly respected, hands-on owner who will be a great caretaker for our headquarters facility and will also benefit from this long-term investment in the highly sought after Washington D.C. office market," said Andrew C. Florance, CoStar founder and CEO. "We couldn't be happier to secure a long-term lease agreement with GLL as the new owner of this trophy asset."

CoStar acquired the two-year-old, Class A building through a wholly owned subsidiary on February 5, 2010 for $41.25 million or approximately $243 per square foot. The purchase price was one of the lowest paid on a per-square-foot basis for a new office building in Washington, D.C. in more than a decade. CoStar occupies the majority of the office space in the building after relocating its headquarters office from Bethesda, MD. Under the sale agreement, up to $15 million of the consideration will be 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.