Profit from technology in the real estate industry

Altus Group is a leading provider of software, data solutions, and advisory services to the global commercial real estate industry. Its businesses include Altus Analytics and Commercial Real Estate Consulting.

By segment, property tax is the largest accounting for 45% of 2020 YTD revenues, followed by analytics (36%), and valuations & cost (19%). The company has more than 6,000 software customers and over 50,000 service customers including some of the popular names in the real estate industry.

Altus has operations in Canada (accounting for 32% of 2020 YTD revenues), the US (39%), and Europe (24%), and Asia Pacific (5%). The company is well-positioned to capitalize on the modernization of the commercial real estate market. Altus is a market leader for core CRE practices.

It is known for its large global blue-chip client base and its leading analytics solutions and digital expert services. The company is in a good position to benefit from the rising demand for data and should leverage its leading position to gain from growth in customers and geographies.

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Revenue Growth & Market Exposure

Altus is known for its decades of experience and expertise, and technology-enabled capabilities. It provides mission-critical solutions combining data, software, and advisory to help clients.

Its Property Tax analytical solution is a market leader and has registered fast growth. Its Argus software is used in more than 105 countries while its appraisal management and data analytics solutions represent more than 140 institutional clients and 8000 properties.

Altus Analytics has very strong barriers to entry due to industry-leading products, scale, and global customer base.

Altus’s revenues have registered a growth of more than 5% in the last five years. Altus Analytics’ integrated platform provides complete visibility to enhance the performance of CRE assets while its consulting services provide technology-enabled CRE professional services to its clients.

The company provides solutions for all stages of CRE asset life ranging from appraisal management, data analytics solutions, data solutions, property tax, valuation advisory, and cost advisory.

Altus has almost 80% recurring revenues and a 95% client retention rate. The company is transitioning its clients to cloud subscriptions which will generate new revenue opportunities while creating value for customers.

Altus is one of the top five players in the US and has an estimated market share of 60% in Canada and 20% in the UK. It enjoys a leadership position in the property tax business across key markets and has relations with the largest CRE companies.


Altus Group has a modest annual dividend yield of 1.25% but a high payout ratio. It last cut its dividend by 20%. The company paid $0.15 per share quarterly but has no formal share buyback program in place.

Altus has limited revenue impact in case of a downturn in the CRE market with a high degree of predictable and recurring revenue stream. It has a strong client and project retention in its consulting business. Moreover, the company has a strong balance sheet and cash generation with stable revenues from a global blue-chip client base.

Altus has a solid track record of revenue, customer, and asset growth on its platform. The company is at the forefront of driving the digital transformation of the CRE industry. The CRE-tech market is expected to grow exponentially in the future with nearly $6 billion invested in CRE tech since 2011, out of which ~70% was invested in the last two years itself.

Altus is uniquely placed to gain from its global Property Tax practice that continues to represent an attractive growth area. The company has a low CapEx requirement of under $10 million per year. Given its wide range of commercial real estate solutions, Altus is well-positioned for up-selling and cross-selling across new customers and geographies.

Altus is making sound progress on transitioning its client base to the AE cloud‐based subscription solution and expects to migrate the majority of the AE users by the end of 2023. Altus’s cloud solutions are well-positioned to offer collaboration capabilities that are required for working remotely.

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Altus Group is in a good position to leverage the growing demand for a wide range of client needs in the commercial real estate technology space. Its technology-enabled services should continue to drive client value in the future.

The company’s global, multi-product enterprise contracts are well suited for meeting end-to-end client needs. Though the pandemic has caused short-term challenges in certain parts of Altus’s business, the company will continue to benefit from add‐on sales to existing customers, new license sales, and cloud migrations in a post-Covid world.

Bottom Line

Altus Group competes with Brookfield Property Partners, Tricon Partners, FirstService Corp., and Colliers International in the real estate services segment. FirstService Corporation is a leading real estate services company in North America and the largest manager of residential communities while Colliers is a leading real estate service and investment management company.

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