CoStar Restructures Board, Plans Capital Review Amid Investor Pressure

CoStar Group has announced a major board overhaul and the formation of a Capital Allocation Committee aimed at enhancing profitability and strategic direction following agreements with hedge funds D.E. Shaw and Third Point. The board shakeup includes the appointment of new independent directors such as former Disney CFO Christine McCarthy, along with the resignation of existing members, including Chairman Michael Klein. The committee will specifically review investments, notably in Homes.com, which has required substantial spending yet is under scrutiny for its path to profitability. With shares having fallen 18% in 2024 amid a sluggish real estate market, the company aims to reassure investors about its commitment to governance and value creation. These changes come as CoStar prepares for potential expansion, including a bid to acquire Australian real estate firm Domain Holdings. Overall, the restructuring is seen as a response to investor pressure to improve governance and financial performance.