Bombshell as Propertyfinder may be forced to close

Propertyfinder, the first of the UK property portals and the third most visited, could face shock closure after an announcement yesterday to the Australian stock market. A management buy-out is also on the cards.

The REA Group, which co-owns Propertyfinder with News International, publishers of The Times, said it will be conducting a review of its UK operations.

REA and News International are both part of News Corp, Rupert Murdoch’s global conglomerate. They bought Propertyfinder in 2005 for about £13m.

However, since then, the Murdoch empire has appeared far more interested in its investment in the free portal Globrix.

Nick Leeming, major client director of Propertyfinder and original co-founder, said this morning: "The announcement to the Australian stock exchange was an official requirement. REA, News Corp andourselves have been looking at a range of options concerning the future of Propertyfinder.

"These include closure, investment, a management buy-out or a sale."

Asked if News Corp, which publishes The Times, had lost interest in Propertyfinder in favour of Globrix, Leeming said: "I have asked them that question, but I didn't get an answer."

Rival Alex Chesterman, chief executive of pay-per-lead portal Zoopla, said he was not surprised at developments: “The business of online property marketing is changing rapidly and the subscription-based models such as Propertyfinder do not align the interests of the portal and the agent customers in the same way as performance-based models.

“We are likely to see more consolidation or closures in the market as more and more agents shift their marketing spend away from subscription portals to models where they can track, measure and ultimately only pay for the results they get.”

The announcement about Propertyfinder comes after the recent closure of Propertyfinder’s print magazines, and amid rumours of an attempted sale of Propertyfinder to its main rivals, Rightmove, and the Daily Mail which publishes four portals including FindaProperty and Primelocation.

Propertyfinder was founded in 1995 by Nick Leeming and his brother, James. It not only pioneered the market but, when known as Asserta, for a while led it even after Rightmove made its entry. The gap between Rightmove and its other subscription-based rivals has since progressively widened.

Propertyfinder has also chewed through a number of chief executives over the years. Gillian Kent is the current incumbent. It has also changed its name: the original Propertyfinder site was bought by the then giant Asserta, which for a time traded the two names before dropping Asserta to trade as a single entity, Propertyfinder.

Propertyfinder still rates consistently as number three in the most successful UK property portals, behind Rightmove and the Daily Mail group’s combined four sites.

  Propertyfinder bought Hot Property two years ago for £5.6m but there have been some suggestions that Hot Property agents were not well integrated into the Propertyfinder site.

It is also understood that property searches on The Times which were powered by Propertyfinder are now powered by Globrix.

The REA Group, whose financial year ends on June 30, will now be under pressure to announce its business plan regarding Propertyfinder.