Blind ambition: CoStar’s Andy Florance opens up about competition, sacrifice and those pesky Glassdoor rankings (Video)

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Joanne S. Lawton

CEO Andy Florance stands by an electronic map in CoStar's lobby that shows the real-time usage of the firm's real estate websites across the country.

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Daniel J. Sernovitz

Staff Reporter- Washington Business Journal

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The story of how the CoStar Group Inc. made an eight-figure profit by moving from Bethesda to Washington and then selling its headquarters building to a German investment firm is legendary among D.C.’s commercial real estate circles.

What isn’t so widely known is how CEO Andy Florance made an extra $6 million for CoStar by going on a European vacation while a hedge fund wanted to take over the company’s office in London. The fund was growing rapidly and offered Florance $2 million to buy out the remaining six months on CoStar’s lease.

Florance said no, it’s too much hassle, but how about $3 million? The company said no, and with that, Florance went on vacation for a week with his family in a farmhouse in a remote part of southern France with no cellphone reception.

When he got back to London, Florance had six voicemail messages from the same company, each one offering more and more money. The last message was for $8 million for CoStar’s 10,000 square feet of rented office space.

“I’m like: Done. So I sold our six months remaining on our lease, for $800 a foot. That has to be the record high,” Florance said, choking back laughter as he recounted the coup from CoStar’s headquarters in downtown D.C. “So I think we have the U.S. record for the best return on an office building, and I think we have the highest record paid to buy out a lease on a per-square-foot basis.”

You might be tempted to write off both deals as sheer luck, good timing and some steely nerves — and to be sure, all of those came into play — but both deals illustrate Florance’s drive to make the most, demand the highest and be the best.

Daniel J. Sernovitz covers commercial real estate.