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Tue July 29, 2014
Seattle-Based Redfin May Get A Higher IPO Price After Zillow-Trulia Deal, Banker Says
In the world of online real estate companies, Seattle-based Zillow has dominated headlines lately with its plans to purchase rival Trulia. Is that bad news for Redfin, another competitor based in Seattle?
Zillow’s acquisition of Trulia will make it the biggest online real estate advertising business, according to Bloomberg. But that doesn’t necessarily shut out Redfin, says Charles Green, senior associate with the Seattle-based investment bank and advisory firm Cascade Capital Group.
Green says one reason is that Redfin’s search functions deliver the best results.
"Redfin offers a very good user interface, and I think they’ll continue to grow because of that," he said.
Redfin is privately held, but has been talking about selling shares to the public. Green says the fact that Zillow is paying $3.5 billion in stock for Trulia means Redfin will probably be able to command a healthy share price if it goes public.
"It probably is a good sign for them," he said.
Green says the fact that Zillow is willing to pay so much for Trulia is a signal to investors that the online real-estate industry still has a lot of room to grow.