RealPage Bought Rainmaker's LRO For $300M

After acquiring Axiometrics for $75M in cash in January, RealPage has acquired Lease Rent Options from The Rainmaker Group for $300M in cash. The acquisition is expected to close during Q2 2017.

LRO uses software to forecast availability and demand at the unit type level for more than 1.5 million apartments. In 2016, LRO had a revenue of $36M. Earnings before interest, tax, depreciation and amortization was about $10M. 

RealPage estimates that less than 10% of the 45 million rental housing owners in the U.S. use data-driven pricing science, and that this acquisition will better position RealPage to penetrate an untapped market.

“Price optimization creates real opportunity to increase asset values and yields from the nearly $3 trillion of apartment stock in the U.S. that turns over at $150B per year,” RealPage chairman and CEO Steve Winn said in a statement. “We have all of the components necessary to offer solutions that bring efficiency and precision to the apartment real estate sector which has historically lacked the solutions available in other investment classes.”

LRO co-founders Bruce Barfield and Tammy Farley will remain with The Rainmaker Group to run the gaming and hospitality division, and have agreed to work closely with RealPage during the transition.

When asked about RealPage’s future acquisition strategy, vice president of investor relations Rhett Butler said RealPage is never out of the market for the right acquisition. 

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