Ladies and gentlemen, thank you for standing by, and welcome to CoStar Group's Third Quarter 2009 Earnings Call. On the call today, we have CoStar's President and CEO, Andrew Florance; and Chief Financial Officer, Brian Radecki; and Communication Director, Tim Trainor. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session. Instructions will be given at that time. (Operator Instructions). As a reminder, this conference is being recorded. I'd now like to turn the conference over to Mr. Tim Trainor. Please go ahead.

Thank you, operator, and good morning, everyone. I'd like to welcome you to CoStar Group's third quarter 2009 earnings conference call. Before I turn the call over to CoStar's President and CEO, Andrew Florance, let me state that certain portions of this discussion contain forward-looking statements which involve many risks and uncertainties that can cause actual results to differ materially from such statements. Important factors that can cause actual results to differ include but are not limited to, those stated in CoStar's third quarter 2009 press release and CoStar's filings with the SEC, including CoStar's Form 10-K for the year ended December 31, 2008 and CoStar's Form 10-Q for the quarter ended June 30, 2009. All forward-looking statements are based on information available to CoStar on the date of this call, and CoStar assumes no obligation to update these statements. A webcast of this conference call is available on our website at www.costar.com/investors.aspx. Thank you again for joining us. I'll now turn the call over to Andy.

Thank you, Tim. I appreciate it. Welcome, everyone to CoStar Group's third quarter 2009 conference call. I'm very pleased once again to report that CoStar Group completed another profitable quarter with a strong performance of 4.3 million in earnings. Third quarter 2009 EBITDA was 10.6 million. Revenues for the third quarter were 53.6 million, a 7% quarterly increase from 50.1 million in the second quarter of 2009. As a result of the strong fundamentals of our core business, CoStar continues to generate consistent profits and enjoy a very healthy and secure financial position despite the current weakness in the commercial real estate markets. In fact, we believe that we are seeing a marked improvement in our business fundamentals currently. As we noted in our press release issued yesterday, we saw fewer cancellations this past quarter, a significant improvement in our organic revenue growth, and our renewal rate increased in the third quarter over the second quarter. Perhaps, more importantly, the company's outlook going into the fourth quarter is for continued improvement in these areas. Clearly, we are still operating in a down market. However, these positive trends and a number of other positive market indicators that I will discuss later in the call lead us to believe that a potential recovery may be in sight. The value placed on our information by subscribers has always separated CoStar from competitors, and we believe it remains the chief reason why CoStar Group has continued to enjoy high renewal rates and generate strong earnings and cash flow through the whole recession. And we fully expect the company will continue to do so. We added 10.2 million to our balance sheet during the third quarter and our cash balances now exceed [$0.25 billion]. Our total cash, cash equivalents and investments on-hand totaled 253.9 million,…

Organic is up too.

Okay. So it’s up organic and it’s up with PPR. So it’s the first increase in subscriber count on an organic basis since the third quarter of 2008. In addition, the average new contract value among our U.S. site subscription sales also increased to 7,878 in the third quarter compared with 7,497 at the end of the previous quarter. Our annualized net bookings, although still negative, showed a quarterly improvement of $3.17 million. This reflects the positive impact of an increase in our overall gross sales coupled with a slowing pace of reversals and contract write-downs. We are seeing a turnaround in our sales in some of those markets that went into the down cycle first. In Orange County, California, for example, which was the epicenter of the financial meltdown, we’re now seeing very strong sales, positive overall revenue growth. That market led the country in leasing activity as a percentage of total inventory in the third quarter of this year. As this cycle continues, we expect to see an increase in office leasing activity among more markets as rents adjust, which of course is a welcome good news for brokerage firms, which then we believe could translate into more sales for CoStar Group. So there’s something of a rental capitulation creating volume, creating additional commissions, creating sales for us. Another sign that the cycle may be turning is the interest we’re seeing from former customers in becoming subscribers again. Many of these former clients canceled out of necessity. They simply had no cash flow. Others perhaps tried using competitive services to cut costs but found the quality of information to be wanting and provided much less value than the CoStar services. I expect we will see a number of former subscribers rejoin us as their businesses recover and they…

Thank you, Andy. As Andy mentioned, we are pleased to report CoStar achieved solid financial results for the third quarter of 2009, and we saw a marked improvement in many areas of our business. Today, I’m going to focus principally on sequential results for the third quarter of 2009 compared to the second quarter and also on our outlook for the fourth quarter of 2009. As we progress through the current economic and commercial real estate cycle, we believe sequential trends offer the most insight into the performance of our business. Our Q3 revenues came in stronger than anticipated at 53.6 million, which was above our guidance range, and increased 3.5 million over the second quarter of 2009. Our favorable revenue performance during the quarter was directly related to the prorated acquisition of PPR at 3.8 million, which was substantially higher than expected, and a noticeable stabilization of our organic revenues, which only declined 240,000 in Q3, representing a significantly smaller decline than the average of the prior two quarters, which was over $1 million. Q3 subscription revenues accounted for 95.1% of our total revenues. On a functional currency basis, the international revenue stabilized at £2.9 million in the third quarter of 2009 and is flat compared to the second quarter. This is a positive sign that recovery may be near in the U.K. International revenues were 8.9% of the company’s total revenues in the third quarter and 88.4% of those were subscription-based. Our 12-month trailing renewal rate, which is a measure of renewing subscription revenue, was 84.6% or approximately 85%. While I publicly stated for nearly two years that we expect the 12-month trailing renewal rate to decline to the low to mid 80s for the calendar year 2009 and then begin to recover next year, we have now…

(Operator Instructions). And first we’ll go to the line of John Neff with William Blair. Please go ahead.

Hey, guys.

Hi, John. How are you doing?

Good. A couple of questions here for you just a little bit on the PPR acquisition, any impact there on the retention rates that you reported? In other words, is that an organic number?

Yes. The retention rate is all organic. It doesn’t factor anything from the PPR’s deal.

And the PPR deal, just on a side note is almost - they’re running almost at the identical numbers that we are. So it is pretty much identical.

Right. The tax rate, Brian, just a little more detail there, is it now - I think of the U.K. as having a lower corporate tax rate than the United States. So is it suddenly advantageous to have some of the U.K. operations in the U.S. tax jurisdiction? Is that an indictment of future U.K. profitability? And is this change permanent? In other words, what sort of effective tax rate can we expect perhaps even next year?

Sure. We’re not giving guidance on next year, but as we all know, in taxes nothing is permanent. The tax rules change daily. But what I can say is that, if you look at how we utilized - we utilized almost $100 million of NOLs over the history of the company. When we just completed that I was told by several tax partners that we were one of the few public companies that actually utilize all of their NOLs. We’re now taking advantage of utilizing the NOLs over in the U.K. from the losses there by moving that entity under the U.S. for tax purposes. So it’s not - it doesn’t give any indication of what plans are internationally, but it’s just allowing us to utilize those now because you don’t have profits in the U.K. where you can utilize those NOLs at those lower rates that you have. So you are able to utilize them now to offset higher U.S. tax rates. So this is a tax planning strategy. It’s a small benefit in the quarter but, to me, the more exciting thing is the possible cash tax savings we’re going to have over the next five to seven years from this, which is real.

So, I mean five to seven years, for all practical purposes, fairly permanent?

If you want to call that permanent.

Okay, foreseeable future?

For the foreseeable future, I like that better.

That wouldn’t be permanent [in marriages].

I think every time I say permanent, I think I said something about the tax rate will go down. People are going to pull my comment from two years ago and then we had an $8 million gain and the tax rate went down. So I try to avoid saying permanent and will not do this because things happen in the business which sometimes changes. But this is another way of us utilizing and saving more cash, which should be important to investors. It should be a positive.

Yeah. But one thing you had mentioned, that you quantified it as a $0.01 per share benefit in the quarter. Last quarter, you had guided to 45 to 47% effective tax rate, so I guess I think of it - at 40% that’s about $0.03 benefit in the quarter. Is that incorrect?

No. It’s about 44% for the year if you look at the annualized year rate and you take the difference between the annualized and the in-quarter, it’s about $0.01, $0.015, somewhere around there.

Okay. Then a question for you on Resolve, how is that solution deployed? Is that client/server, or is that software as a service? I’m trying to think - are there any data advantages that accrue to you, given how Resolve solutions combine a client’s internal as well as external data?

It’s actually - you can imagine this is the crown jewels of proprietary data for these customers. So the solutions are - I mean so it’s a series of web reporting tools, but it’s all deployed inside the client’s firewall and we get no data benefit from their data that’s in the Resolve platform. And similar to the tax situation though, nothing is permanent. It does open up the possibility that sometime down the road at the client’s choosing, they may decide to share and benchmark data back and forth amongst each other. This would create a systems infrastructure that would make that fairly straightforward and inexpensive to do. The real value is the fact that if I’ve got 1,000 investment grade office properties in 400 different sub markets in the United States, integrating the details of my internal property management system, lease administration system, accounting system, budgeting and forecasting system with CoStar data, the benefit is extraordinary. Being able to basically have a third-party independent automated valuation function for your assets and get a rolling daily independent third-party view potentially down the road of your loan-to-value ratios and your equity and so and so is phenomenal. So it’s got a lot of potential.

And last question just --

It is dilutive in the first quarter though.

Last question, I just want to --

On an accounting basis, I’m sorry.

A showcase update and jut how - any sense of the annualized run rate there? And also give us an update on - you mentioned you have got 1.35 million listings on - across CoStar’s entire platform currently. What percentage of those are you allowing to be in Showcase? How many listings available in Showcase versus your overall universe? Thanks very much.

Sure. On the 1.35 million listings, I don’t have the precise numbers with me. We do have caps on what we’re proactively selling in the various sub markets and markets. And I believe we are below those caps. I think Anchorage, Alaska sold out. I think half of the listings and literally half of the listings in Anchorage showed up on Showcase. And so we maxed out in that market. We stop selling new ones. But it is still probably less than 15% of the listings are moving through Showcase. So we don’t believe there is any cannibalization occurring there. One of the models for that product was our company up in Scotland, SPN. They have a Showcase-like product, which has 85% of the listings in Scotland up on it and yet they still have all the major brokerage firms subscribing to the information product. So I don’t think we’re anywhere near any sort of substitution effect. And what I will do is I will try to come back and give you a briefing next quarter on how things are going at Showcase. It’s going fine, it’s going well, and we’ll prepare some more detailed remarks in next quarter’s earnings call for it.

Great. Thank you very much.

Thanks, John.

And next we will go to the line of Jon Maietta with Needham & Company. Please go ahead. Jonathan Maietta - Needham & Company: Hey, thanks very much. Hi, guys.

Hey. How are you doing, Jon.

Hey, Jon. Jonathan Maietta - Needham & Company: Good. So strategically, I just want to make sure, I’m not missing anything in that, with these past couple of acquisitions, you’ve effectively extended the value of the database, number one. I think, number two, you’ve done a good job of what I see a lot of consulting organizations do in that you’ve chased the dollars where they are being spent today. And three, I’m just wondering is there anything else? Does this help you put up a defensive wall against competition potentially or --?

Sure. This is a way to accelerate our move into value for institutional large-scale financial organizations, which is absolutely a - something that represents a barrier to competitive entry. So we think that, with 20 some years of experience, you look at the various people involved in these different companies, myself, Eric Forman, Bret Wilkerson. We’ve all been in this business serving institutional clients for 10, 20-plus years. So working together, we can build some very compelling products for the institutional world that right now has got intense information requirements on revaluing assets, deciding on what they’re going to dispose, what they’re going to acquire and giving them real-world solutions to integrate their proprietary internal data with the best forecasting available - the best data available. And I think that represents a huge competitive advantage. And this is a difficult step to replicate. If you look - if you sit through a day-long presentation of the Resolve portfolio, maximize their software like I did on Monday, you would come to appreciate that this is not some build it this week and off to the races you go. This is extraordinarily complex, sophisticated software we’re talking about here. So I think it would take a lot of time to rebuild this stuff. Jonathan Maietta - Needham & Company: Andy, just to piggyback off of John’s question with regard to Resolve and potentially exchanging data with that platform at some point, would that require you to rewrite the platform? Could we potentially see a software as a service offering at some point?

Well, absolutely. We could provide this and we could have spin-offs that are software as a service. In fact, we’ve discussed that. So there are a lot of derivative products that are possible. But in terms of the access and the client data, that data, it’s utmost importance to us and Resolve that that data is completely secure, confidential inside their firewall; it’s their data. It only be - because those clients, who actually are a pretty active user group, get together and want to do some benchmarking, assuring that day that we would do that, that we’d ever be having that discussion about their data. But should that occur, it would be real easy to do. So should they decide to push something outside the firewall, they are all in the same - because of Resolve, they are all in the same data structure. We’ve actually mapped out all of the charts of accounts from all kinds of disparate accounting systems and disparate property management systems, and it would be very straightforward to create benchmarking that could be extremely useful to them. Jonathan Maietta - Needham & Company: Interesting, okay.

Again that’s completely their choice. Jonathan Maietta - Needham & Company: Got it. Okay. What does the Resolve - the typical Resolve sales cycle look like? Is it six to nine months? Is it three months or --?

It’s probably six to 12 months. It’s fairly - I mean, this is something that goes throughout an organization. It has a one year plus implementation cycle for the higher-end product. They do have a lower entry-level or a more entry-level product which is an out of the box low cost implementation product, but generally it’s a pretty extensive implementation. Jonathan Maietta - Needham & Company: Okay. And then Brian, with regard to gross margins, should we expect kind of a similar margin going forward for the next couple of quarters or so? Or how do you think about that?

Yes, I think so. It might have a slight downtick when you add in the Resolve but in general you’re at about the level that you’re going to be at for a few quarters. Jonathan Maietta - Needham & Company: Okay. And then do you happen to have the figure for stock compensation in the quarter?

Sure, yeah. It has been running at about 1.5 million or 1.6 million a quarter. It is about two million in Q3, which a lot of that is what we disclosed as far as the acquisitions of PPR and it will probably be running at about two, 2.1 in the fourth quarter with Resolve. Jonathan Maietta - Needham & Company: Okay, perfect. Thanks very much.

Thanks Jon.

And next we’ll go to the line of Brett Huff with Stephens Inc. Please go ahead.

Good morning and congrats on the Resolve deal.

Thank you, Brett.

A quick question, I want to make sure that I understand the internal growth trends going on. So can I just do a - some quick back-of-the-envelope math, trying to understand exactly what the Resolve impact will be for 4Q, Brian? If I take the midpoint of your guidance, which is 53.5 and take out - should I take out 3.8 for PPR in 4Q to get to an organic number? Is that the right estimate?

Yeah, it will be plus or minus around there.

Okay. And then how much - I try to kind of do your math on Resolve, which is - I took the 3.6 million and took away the $1 million of deferred revenue and then tried to kind of prorate it for the amount that you guys will own it for Q4 and got a couple of hundred thousand dollars and that gets me to 49.5 of organic revenue. Is that a reasonable way to go at it?

Yeah. I mean I didn’t put a number on the Resolve, but I agree it will be a couple of hundred thousand. It will be very minimal in the fourth quarter, and then that will grow back up to kind of that 3.5 to $4 million rate next year as we sell those and book them in deferreds.

Okay. I just want to make sure that compares then to the - so that is 49.5 by my math, whether it is right or wrong, to 49.8 this quarter. So that tells me your organic growth, to your point, will be - declines will - that we’ve seen sequentially have moderated meaningfully and that’s what you’re saying when you’re seeing these trends continue. Is that right?

Exactly, exactly. I think we’re still seeing a lot of positive trends and we would expect to see those positive trends through the fourth quarter. And I think that’s why the Resolve deal, not only with deal cost is so dilutive in the fourth quarter is because you have no revenue to really support their cost structure because of accounting reasons. But again, for cash flow purposes, it’s nonexistent.

Brett, you should be writing some of our scripts.

Okay. I just want to make sure I get the organic in the right way. Andy, I think maybe this is a question for you. On the net adds, I think you said you gave us an add number of 873. Is that gross or net? And do you have a gross number if it’s not?

That is net and I don’t have a gross number right here. That would take some work.

And then just in terms of - can you give us a little bit more detail or color on - you gave an example of why people aren't canceling now. Can you give us a sense of what they're saying when they re-sign up? Is it brokers who are saying okay, life is not as bad as it used to be, I have cash, or is it non - you know, the half of your business is non-brokers, who is actually buying new now?

Well, first of all, as we've gone in this cycle, a lot of the stuff actually makes it up to my e-mail as you go into a really severe cycle like this. And you see a lot of [vignette] of what's occurring in the marketplace. So you have some people that aggressively try to negotiate amazing discounts because of the downturn. I've gotten an awful lot of e-mails from good customers who have been customers for a long time that say, [you don't pay] loves your service, I simply don't have any money to pay for it. I haven't had a commission in 18 months, so I have to appreciate everything. I have to shut it off for a while. We're seeing a fair number of that kind of a person, who are seeing some commission checks come in, turn the service back on. So they turn it off for a year because they didn't have any money. Now that things are back, they're - and so what we're seeing again we took a -- we did analysis of all the U.S. cities and we looked at the change in rental rate in the preceding year and correlate that against the leasing volume, and there's a close correlation. So as owners basically come to grips with the fact that rents are going to be lower and they bring their rents down, tenants are taking advantage of that leasing space. We believe that's driving up these leasing commissions so people can come back on board. So there's some of that. Also why are cancellations mitigating? Because a lot of the marginal folks who just entered the business in 2007 at the crazy, cheap credit top of the market died in the first 18 months of the downturn. So, the Darwinian effect…

No, that's really helpful. I appreciate it. That's all I had. Thanks, guys.

Okay, great.

Thanks, Brett.

And next we'll go to the line of Ian Corydon with B. Riley & Company. Please go ahead. Ian Corydon - B. Riley & Company: Thank you. Couple of quick ones. Of the 83,000 or so paying subscribers, can you say how many of those are PPR subscribers and how many are showcase also?

Two. No, Brian, what would you guess on the PPR side?

The PPR is about 600 or so adds. So we had almost 300 adds, organically; and so that's kind of how that broke out. So we saw both organic increase and then obviously the increase we're picking up with PPR. And I don't have a number right here on what the exact number would be for the showcase side. Ian Corydon - B. Riley & Company: Okay. And I'm not sure --

We'll try to address that in the next - we've got two questions on that. So we'll try to address more of that in the next earnings call. Ian Corydon - B. Riley & Company: Okay. And I don't know if you gave this but do you have the number of subscribing sites at the end of the quarter?

It is 15,000 -- hold on one second. We have that number here.

15,300.

So, 15,300. That would include PPR - it would not include PPR. It would not include PPR.

So with PPR, it would be a couple of hundred more.

I think there's 187 with PPR.

Yes.

So you'd add 187 onto that. And then I don't think it includes individual showcase or CLMS subscriber sites, probably does not include metropolis.

Correct.

Right. So that's an approximate number. Ian Corydon - B. Riley & Company: Okay. And it looks like that number I think is down a little bit sequentially. Are you just seeing -- are you seeing the adds come on with more sites or your existing customers adding -- existing sites adding customers. How is that working?

We're probably seeing a growth in the adds, maybe cross-selling into some institutional players or different departments, that sort of thing. Ian Corydon - B. Riley & Company: Okay. And on the PPR numbers coming in ahead of expectations, was that driven by cost selling - cross-selling or is that improvement in kind of their core business?

It is. There were some good cross-sells, right of the – [right off the bat]. So like we had a deal this week, I think that came in like five days time on a cross-sell for 60,000 that was nice. Royal Bank of Scotland was a cross-sell, a big cross-sell that happened. So - and we're doing a big push on that in the fourth quarter. We're trying to get out and we've identified several hundred CoStar customers who are the right profile, revenue level, who are ideal customers for the PPR forecasting. We're trying to get out and visit every one of those folks in the fourth quarter to tell them about the PPR forecasting and analytics services. Also, we're limited to what we can talk about, but we also are providing some services to the subcontractor on the TALF program to the Fed. And you'd be shocked to know that business is growing, so the revenues from that have been climbing.

And ahead of our expectations.

Yes. And we want to thank you as a taxpayer. Ian Corydon - B. Riley & Company: My last question is on the comps and the tenant expansion. Could you just kind of give us a magnitude of how much that product has been expanded?

It's fairly dramatic and pretty important. This really represents - up until we did this, there were still 80, 90 reasonable MSAs that did not have tenant or comparable sale data from us in the United States. And these are not going to be the New Yorks and LAs. But you see - an example of a decent-sized city that would be San Antonio.

San Antonio, Texas would be a good example.

Salt Lake City.

Salt Lake City.

So these are pretty good-sized cities that did not have our full product suite, which would really limit your ability to do more sophisticated analytics, would probably frustrate some banks or institutional investors. And so, this means that our product offering in 70, 80 MSAs just significantly clicked up a notch here, and we've added another significant dimension to the product and it should drive strong sales in those smaller markets. Now, you've to drive a lot of sales in those smaller markets to move the overall dial, but it's a good place to be. And we're sure trying to make sure that we're looking at every space that we're in and pursuing that objective here. The number one or number two going to number one and that does a lot of that. So if you look at some of our - if you looked at Salt Lake City and say, how we're going to be number one Salt Lake City? How we're going to be number one in San Antonio? And this does that for us. Ian Corydon - B. Riley & Company: Great. Thank you very much.

And next we'll go to the line in Jim Wilson with JMP Securities. Please go ahead.

Thanks. Morning, guys.

Morning, Jim. Thanks getting up early for us.

I'm always up. So with the 600 new PPR clients, I guess, either way of looking at it or both, what kind of number or percentage were already existing CoStar customers? And I guess maybe more importantly, the bigger PPR customers or the bigger CoStar customers, which are already customers of both services? Or how many are customer of both services?

Actually, it's pretty interesting. The - of this, the site level is a little easier for me. It's about roughly 180 sites on PPR, and we're dealing with several different product areas. So, you could be a debt customer, you could be a consulting customer, you could be a baseline information customer. I believe it was - what do you say, Brian, about 70%?

Yeah.

About 70% of those PPR customers are also CoStar customers. But you had examples where someone might be a significant national customer for PPR but only a landlord representation customer for CoStar in one Texas City. So you can have someone with a small CoStar footprint and a large PPR footprint. So you still have, even though you've got - 70% are customers of both - you still have a lot of upsell opportunity within both services. The other thing is, in talking to customers, they really regard these products as completely different and they're used in different ways by different segments generally. So our products are relied on heavily by the people doing valuation, by people doing transactions, positioning properties competitively, marketing properties, and the PPR. PPR products would tend to be used more intensely by someone doing portfolio strategy work for a larger organization. So one of the things I think is sort of exciting here is we are building together a matrix here of products that are going to eventually be seamlessly integrated that are reaching many different constituencies within these bigger operations. So we might be, with PPR, reaching the folks managing portfolio and acquisition disposition strategy. With Resolve, we can be reaching the asset managers and the finance department, CFO's office and with customer property we're reaching the appraisers, the brokers, the whole valuation side of it. So it were - these are different segments within these companies. But the bigger thing is there are hundreds of the PPR profile of customer that are CoStar subscribers that are not PPR subscribers. So we should be able to - that's where you're going to see your biggest sales growth.

Yeah, that makes sense. All right and just one other question, Brian, the best tax rate to assume going forward, since it was lower this quarter?

Yeah, I think, we're at - 2009 is at about 44%, so I think that's what the annualized is if you calculate it off the P&L. We haven't come out with 2010 guidance yet, but obviously when we do we'll give a 2010 number.

All right, thanks.

Thanks, Jim.

Next we'll go to the line of Vance Edelson with Morgan Stanley. Please go ahead.

Hi. Thanks a lot. I'm just trying to -

How are you doing?

Doing all right. Just trying to reconcile on the margin expansion trajectory, I think, Brian, you had mentioned that you expect to return to more normal EBITDA margin expansion in the near future, but also margins are expected to be flat for a few quarters, if I heard correctly. So, I guess, the bigger question is how should we think about the margin goals as we move into 2010? Is margin expansion is sort of an overarching company goal or is it more likely that attractive acquisitions could weigh on that margin expansion in the near-term? And how do you balance those goals?

Well, I think, we've long had a 30% target EBITDA margin out there for years and we've shown that the business can do that. So, I think, that's obviously the longer-term. Again, we're not giving out 2010 guidance. But I think that 30% EBITDA target margin has been posted around CoStar for the 12 years that I've been here. We've achieved that and I think that that's where we will be long-term. In the shorter term, you are right. You have to kind of balance the potential acquisitions that could be somewhat dilutive in the short-term, that will be very accretive in the long-term. So, if I was only to look at the fourth quarter and the impact on Resolve or only look at the third quarter, the impact of PPR, I would have done the same thing, we did the comps acquisition where we now have 40, 50, 60% margins returning from it. We acquired them, they are losing about $8 million a quarter. So, I think, that you do have to balance the short-term impact with what we believe the long-term goal is. 30% has been the goal but we clearly see 50, 60% fully loaded EBITDA margins in places that we've been for over a decade. So people have seen us present. There is no reason why this business can't be doing over a billion in sales in the next 10 to 15 years and doing a 40, 50% plus fully loaded EBITDA margin. So that's where the company is focused. A lot of these acquisitions opening up these huge market opportunities is going to be what helps drive us to get there.

Okay. Got it. And then, I guess, another balancing act in the near-term is - you continue to see is advantageous to grow the ranks of the salespeople even though that might add some margin pressure. Where do you think the sales head count is ultimately headed? A lot of folks were added during the quarter. Does it look like that's going to go well above 200 in the coming quarters?

Well, the good news there is we have actually - Jim Black has taken over responsibility for our sales recruiting and our training of salespeople. Jim actually - for those of you who are commercial real estate nerds, would know Jim from - he basically was the predecessor to CoStar Group. He invented - he did the Black's Guide office directories, which were the Bible of commercial real estate through the '70s and '80s. So, he is a great trainer, recruiter. And we have been experiencing a very different ROI on new salespeople recently than we’ve historically experienced. So we are in some sectors, in some sales of strategies. We’re actually getting a positive ROI from new sales hires inside of four months. And historically, that ROI was out there at a year. So while we can continue to add salespeople in a - and get an ROI almost within the quarter, we will keep reporting to you that we’re increasing the sales force.

Okay, great. And finally, just a housekeeping item, I think we're only missing one metric at this point. The number of new paying subscriber firms which last quarter I think was 494. Is there an updated metric for the third quarter?

I think it was approximately around 400, but I'll check it out and give you a number.

Sorry about that. We normally do that.

Okay. No problem. Thanks a lot guys.

Okay. Thank you. So, again, I want to thank you all for joining the third quarter 2009 earnings call. And we look forward to updating you on the - oh my gosh - the year-end next call. So, I hope you guys have a good rest of your week.

Ladies and gentlemen, this conference will be made available for replay after 1:45 PM today until November 5th at midnight. You may access the AT&T Executive Playback service at any time by dialing 1-800-475-6701 and entering the access code of 118413. International participants may dial 1-320-365-3844. Again those numbers are 1-800-475-6701. For international, it’s 1-320-365-3844 with the access code of 118413. That does conclude our conference for today. Thank you for your participation and for using AT&T Executive Teleconference Service. You may now disconnect.