MSCI Buying Real Capital Analytics for $950M

The world’s best known provider of securities indexes is expanding its reach into the alternative investment sector as MCSI today announced that it has agreed to buy Real Capital Analytics for $950 million.

The deal gives the former unit of US investment bank Morgan Stanley the rights to a database cataloging $20 trillion in real estate investment transactions globally, along with RCA’s business of selling subscriptions to that information to more than 2,000 clients.

“The commercial real estate sector is seeing substantial transformation driven by several factors, including shifting consumer behaviors in work, lifestyle and travel accelerated by the pandemic, realignment in global supply chains, and the impact of climate change,” said MSCI chairman and chief executive Henry Fernandez. “The combined strength of MSCI’s existing data, analytics and tools, and the addition of Real Capital Analytics’ wealth of commercial real estate data and analytics, creates an unparalleled level of solutions for the real estate market.”

MSCI will be adding RCA’s lists of properties bought and sold to its indexes tracking the movements of equities, fixed income products and other asset classes following completion of the all cash transaction, which is expected in the third quarter or early in the fourth quarter of this year.

Becoming the ‘Go-To’ Source

MSCI said in an investor presentation that the acquisition enables it, “to create the global ‘go-to’ reference data set of institutional real estate fund and asset information, as well as market capital transaction information.”

The company expects that acquiring RCA’s transaction data, which is linked to over 200,000 investor and lender profiles, will enhance MSCI’s commercial real estate service offering and allow it to provide real estate investment clients with data, analytics and support tools to manage investments and understand performance and risk.

MSCI currently operates a dataset covering $2 trillion in private real estate assets in 30 countries over the past 20 years, according to its website, in addition to tracking more than $450 billion in publicly listed real estate. RCA currently tracks transactions in some 170 countries.

Today’s acquisition comes nine years after MSCI made its first major move towards tracking private real estate markets when it acquired the parent firm of London-based International Property Database (IPD) for approximately $125 million.

21 Years to Exit

“MSCI is a natural home for Real Capital Analytics since our primary goal has always been to bridge the information gap between commercial real estate and other asset classes across the financial markets,” said RCA founder and president Robert M White Jr. “The combination of the two firms creates a powerful team that will lead innovation and analytics in the real estate asset class well into the future.”

A former investment banker, White had founded the privately held company in 2000 and now has a team of some 475 people operating in six locations globally, including the company’s headquarters in Manhattan and an Asia Pacific office in Singapore.

Two years ago, RCA raised $115 million from private equity firm Susquehanna Growth Equity to buy back a 40 percent stake in the data provider from Daily Mail Group Trust. RCA spent $89 million to purchase Daily Mail Group’s shares in an April 2019 transaction that valued the company at $225.5 million.