Fee Revenue up 14% (21% in local currency) Normalized EBITDA up 18% (24% in local currency) Adjusted Earnings Per Share up 28% to $0.51 Company Increases Expected 2016 Adjusted EPS Accretion From Global Workplace Solutions Acquisition

Los Angeles, CA – October 27, 2015 — CBRE Group, Inc. (NYSE:CBG) today reported robust revenue and earnings growth for the third quarter ended September 30, 2015.

Third-Quarter 2015 Results*

  • Revenue for the quarter totaled $2.7 billion, an increase of 19% (26% in local currency1). Fee revenue2 increased 14% (21% in local currency) to $1.9 billion. The third quarter of 2015 included approximately $237 million of revenue from the acquisition of the Global Workplace Solutions business from Johnson Controls, which was completed on September 1, 2015. Excluding the acquired Global Workplace Solutions business, revenue and fee revenue were both up 9% (16% in local currency).
  • On a U.S. GAAP basis, net income rose 39% to $149.1 million. GAAP earnings per diluted share rose 38% to $0.44.
  • Adjusted net income3 rose 30% to $171.7 million, while adjusted earnings per share3 improved 28% to $0.51. For the third quarter of 2015, adjustments totaled $22.6 million, which included integration and other costs associated with the Global Workplace Solutions acquisition.
  • Normalized EBITDA4 increased 18% to $344.6 million and EBITDA4 rose 12% to $326.6 million. Normalized EBITDA margin on fee revenue was 17.8%, approximately a 60 basis point increase from the prior-year third quarter.

*All percentage changes versus prior-year periods are in U.S. dollars except where noted.

  • Foreign currency movement, including the marking of currency hedges to market, reduced EBITDA by approximately $16.9 million (or $0.03 per share, net of tax) as compared to the prior-year third quarter.


Martin Samworth, CEO EMEA, CBRE
“Q3 was an excellent quarter for CBRE in EMEA, delivering material gains in both revenue and EBITDA in dollars and local currency.  Our growth was driven by region-wide successes across all business lines– most notably in Capital Markets, our Occupier Outsourcing business, and Hotels, with core markets such as Germany, Spain, France and the UK performing strongly.

“These results demonstrate the benefit of the breadth of service and insight we are able to offer our clients across the region.  Our recent acquisition of Global Workspace Solutions now also adds an important international Facilities Management dimension to our capability and we enter the fourth quarter with good momentum.”
Martin Samworth, CEO EMEA, CBRE

Management Commentary

“The third quarter was an eventful period for CBRE,” said Bob Sulentic, the company’s president and chief executive officer. “We continued to post double-digit growth on the top- and bottom-lines with broad-based strength in our business around the world. While doing this, we completed our largest acquisition in nearly a decade – the Global Workplace Solutions business from Johnson Controls. We also continued to make gains through investments in initiatives that help us to deliver great client outcomes and drive growth.”

CBRE’s three regional businesses each achieved sizeable increases in revenue despite the impact of foreign currency translation, which tempered growth rates outside the U.S. Growth was particularly notable in EMEA (Europe, the Middle East & Africa), where revenue surged 28% (42% in local currency). This increase was fueled by healthy gains across the region, including France, Germany, the Netherlands, Spain, Switzerland and the United Kingdom. Asia Pacific produced 12% revenue growth (29% in local currency) – led by Australia, Greater China and India. In the Americas, CBRE’s largest business segment, revenue grew by double digits – 17% (19% in local currency).

Amid strong capital flows into commercial real estate, CBRE’s capital markets businesses continued to perform exceptionally well. Property sales rose significantly across all regions with global revenue up 11% (19% in local currency), and commercial mortgage services, which is predominately an Americas business, saw revenue improve 32% (33% in local currency).

Global leasing also remained strong, although weak foreign currencies restrained growth. In local currency, leasing revenue rose 12% with strong growth in Australia, France, Greater China and India. When translated into US dollars, the global leasing revenue growth rate was 6%. The growth rate in the United States slowed modestly but remained strong at 9%.

Occupier outsourcing revenue (excluding related transaction revenue, which is accounted for in sales and leasing revenue), improved 42% (49% in local currency), while fee revenue (excluding related transaction revenue) increased 45% (53% in local currency). The increases included a one-month contribution from the acquired Global Workplace Solutions business. Excluding the acquired Global Workplace Solutions business, outsourcing revenue (excluding related transaction revenue) rose 8% (15% in local currency) and fee revenue increased 6% (14% in local currency).

Valuation revenue rose 4% (14% in local currency), which reflected higher volumes of appraisal and consulting assignments.

Investment Management also performed well in the quarter, with a 9% (19% in local currency) increase in revenue and a 48% rise in normalized EBITDA.

Global Workplace Solutions Acquisition Update

The integration of the Global Workplace Solutions business is proceeding well. CBRE now expects:

  • An increase to high-single digits from mid-single digits in the percentage accretion to 2016 adjusted earnings per share from the acquired business.
  • A $0.03 to $0.04 contribution to adjusted earnings per share for the last four months of 2015. The calendar-year fourth quarter has typically been a seasonally slower period for the acquired Global Workplace Solutions business due to its fiscal year previously ending September 30th. As a result, the accretion for the last four months of 2015 is not indicative of the expected higher run-rate contribution in 2016.

Third-Quarter 2015 Segment Results

Americas Region (U.S., Canada and Latin America)

  • Revenue rose 17% (19% in local currency) to $1.6 billion. Fee revenue rose 16% (18% in local currency) to $1.1 billion. Excluding the acquired Global Workplace Solutions business, revenue was up 11% (13% in local currency).
  • Normalized EBITDA increased 16% to $218.1 million and EBITDA increased 9% to $203.6 million.
  • Operating income rose 10% to $150.3 million.

EMEA Region (primarily Europe)

  • Revenue improved 28% (42% in local currency) to $737.9 million. Fee revenue rose 16% (29% in local currency) to $458.0 million. Revenue growth was broad-based across the region with strong increases even after the negative effects of currency movement. Excluding the acquired Global Workplace Solutions business, revenue was up 7% (20% in local currency).
  • Normalized EBITDA increased 51% to $56.7 million and EBITDA increased 49% to $55.8 million.
  • Operating income increased 96% to $39.6 million.

Asia Pacific Region (Asia, Australia and New Zealand)

  • Revenue increased 12% (29% in local currency) to $285.3 million. Fee revenue rose 5% (22% in local currency) to $215.3 million. Excluding the acquired Global Workplace Solutions business, revenue was up 2% (18% in local currency).
  • Normalized EBITDA increased 28% to $29.2 million and EBITDA increased 22% to $27.7 million.
  • Operating income increased 29% to $24.0 million.

Global Investment Management (investment management operations in the U.S., Europe and Asia Pacific)

  • Revenue rose 9% (19% in local currency) to $114.1 million, primarily driven by higher carried interest tied to significant property disposition activity.
  • Normalized EBITDA increased 48% to $30.2 million and EBITDA increased 37% to $29.0 million.
  • Operating income increased 53% to $24.2 million.
  • Assets Under Management (AUM) totaled $86.0 billion. Compared with the third quarter of 2014, AUM was up $1.6 billion in local currency, but down when converted into U.S. dollars.

Development Services (real estate development and investment activities primarily in the U.S.)

  • Revenue increased 17% to $18.6 million.
  • EBITDA decreased to $10.5 million.
  • Operating income improved more than 130% to $2.0 million.
  • Development projects in process totaled $6.7 billion, up $1.3 billion from the end of 2014. The pipeline inventory totaled $4.0 billion, unchanged from year-end 2014, as projects have been converted from pipeline to in-process.

Nine-Month Results

  • Revenue for the nine months ended September 30, 2015 totaled $7.2 billion, an increase of 14% (21% in local currency). Fee revenue increased 12% (19% in local currency) to $5.2 billion. Excluding the acquired Global Workplace Solutions business, both revenue and fee revenue increased 10% (17% in local currency).
  • On a U.S. GAAP basis, net income rose 31% to $367.1 million. GAAP earnings per diluted share rose 30% to $1.09.
  • Adjusted net income rose 25% to $417.7 million, while adjusted earnings per share improved 24% to $1.24. For the nine months ended September 30, 2015, adjustments totaled $50.6 million, which included integration and other costs associated with the Global Workplace Solutions acquisition.
  • Normalized EBITDA increased 19% to $895.1 million and EBITDA rose 16% to $869.7 million.
  • Foreign currency movement, including the marking of currency hedges to market, reduced EBITDA by approximately $31.0 million (or $0.06 per share, net of tax) as compared to the prior-year nine month period. Without currency effects, adjusted earnings per share would have increased 30%.

Business Outlook

“As we enter the fourth quarter, 2015 is clearly emerging as another exceptional year for CBRE,” Mr. Sulentic said. “The actions we have taken to upgrade our talent base, enhance our service offering, materially strengthen our operating platform, particularly data and technology, and fortify our financial position are yielding strong results for our clients and shareholders.”

CBRE is mindful of challenges to the global economy. However, in light of its performance through the year’s third quarter and its strategic and financial momentum, CBRE is raising its guidance for full-year 2015 adjusted earnings per share by $0.10 to $2.00 to $2.05. The new guidance implies 20% year-over-year growth in adjusted earnings per share at the mid-point of the range.


For Further Information:

Steve Iaco

Senior Managing Director

Investor Relations & Corporate Communications



About CBRE Group, Inc.

CBRE Group, Inc. (NYSE:CBG), a Fortune 500 and S&P 500 company headquartered in Los Angeles, is the world’s largest commercial real estate services and investment firm (in terms of 2014 revenue). The Company has more than 70,000 employees (excluding affiliates), and serves real estate owners, investors and occupiers through more than 400 offices (excluding affiliates) worldwide. CBRE offers strategic advice and execution for property sales and leasing; corporate services; property, facilities and project management; mortgage banking; appraisal and valuation; development services; investment management; and research and consulting. Please visit our website at


The information contained in, or accessible through, the Company’s website is not incorporated into this press release.


Note: This release contains forward-looking statements within the meaning of the ''safe harbor'' provisions of the Private Securities Litigation Reform Act of 1995, including statements regarding our future growth momentum, operations (including expected contributions and cost synergies from the Global Workplace Solutions acquisition and its integration), financial performance (including adjusted earnings per share expectations) and business outlook. These forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the Company’s actual results and performance in future periods to be materially different from any future results or performance suggested in forward-looking statements in this release. Any forward-looking statements speak only as of the date of this release and, except to the extent required by applicable securities laws, the Company expressly disclaims any obligation to update or revise any of them to reflect actual results, any changes in expectations or any change in events. If the Company does update one or more forward-looking statements, no inference should be drawn that it will make additional updates with respect to those or other forward-looking statements. Factors that could cause results to differ materially include, but are not limited to: disruptions in general economic and business conditions, particularly in geographies where our business may be concentrated; volatility and disruption of the securities, capital and credit markets; interest rate increases; the cost and availability of capital for investment in real estate; clients’ willingness to make real estate or long-term contractual commitments and other factors affecting the value of real estate assets, inside and outside the United States; increases in unemployment and general slowdowns in commercial activity; trends in pricing and risk assumption for commercial real estate services; the effect of significant movements in average cap rates across different property types; a reduction by companies in their reliance on outsourcing for their commercial real estate needs, which would affect our revenues and operating performance; client actions to restrain project spending and reduce outsourced staffing levels; declines in lending activity of Government Sponsored Enterprises, regulatory oversight of such activity and our mortgage servicing revenue from the U.S. commercial real estate mortgage market; our ability to diversify our revenue model to offset cyclical economic trends in the commercial real estate industry; our ability to attract new user and investor clients; our ability to retain major clients and renew related contracts; our ability to leverage our global services platform to maximize and sustain long-term cash flow; our ability to maintain EBITDA margins that enable us to continue investing in our platform and client service offerings; our ability to control costs relative to revenue growth; variations in historically customary seasonal patterns that cause our business not to perform as expected; changes in domestic and international law and regulatory environments (including relating to anti-corruption, anti-money laundering, trade sanctions, currency controls and other trade control laws), particularly in Russia, Eastern Europe and the Middle East, due to the level of political instability in those regions; foreign currency fluctuations; our ability to identify, acquire and integrate synergistic and accretive businesses; costs and potential future capital requirements relating to businesses we may acquire; integration challenges arising out of our Global Workplace Solutions acquisition as well as of other companies we may acquire, and our ability to achieve expected cost synergies relating to those acquisitions; our and our employees’ ability to execute on, and adapt to, information technology strategies and trends ; the ability of our Global Investment Management business to maintain and grow assets under management and achieve desired investment returns for our investors, and any potential related litigation, liabilities or reputational harm possible if we fail to do so; our ability to manage fluctuations in net earnings and cash flow, which could result from poor performance in our investment programs, including our participation as a principal in real estate investments; our leverage and our ability to perform under our credit facilities, indentures and other debt instruments; our exposure to liabilities in connection with real estate advisory and property management activities and our ability to procure sufficient insurance coverage on acceptable terms; liabilities under guarantees, or for construction defects, that we incur in our Development Services business; the ability of CBRE Capital Markets to periodically amend, or replace, on satisfactory terms, the agreements for its warehouse lines of credit; our ability to compete globally, or in specific geographic markets or business segments that are material to us; changes in tax laws in the United States or in other jurisdictions in which our business may be concentrated that reduce or eliminate deductions or other tax benefits we receive; our ability to maintain our effective tax rate at or below current levels; our ability to comply with laws and regulations related to our global operations, including real estate licensure, labor and employment laws and regulations, as well as the anti-corruption laws and trade sanctions of the U.S. and other countries; and the effect of implementation of new accounting rules and standards.


Additional information concerning factors that may influence the Company's financial information is discussed under “Risk Factors”, “Management’s Discussion and Analysis of Financial Condition and Results of Operations”, “Quantitative and Qualitative Disclosures About Market Risk” and “Cautionary Note on Forward-Looking Statements” in both our Annual Report on Form 10-K for the year ended December 31, 2014 and our Quarterly Reports on Form 10-Q for the quarters ended March 31, 2015 and June 30, 2015, as well as in the Company’s press releases and other periodic filings with the Securities and Exchange Commission (the SEC). Such filings are available publicly and may be obtained on the Company’s website at or upon written request from the CBRE Investor Relations Department at


Note – CBRE has not reconciled the (non-GAAP) adjusted earnings per share guidance included in this release to the most directly comparable GAAP measure because this cannot be done without unreasonable effort.


The terms “fee revenue,” “adjusted net income,” “adjusted earnings per share” (or adjusted EPS), “EBITDA” and “Normalized EBITDA,” all of which CBRE uses in this press release, are non-GAAP financial measures under SEC guidelines, and you should refer to the footnotes below as well as the “Non-GAAP Financial Measures” section in this press release for a further explanation of these measures. We have also included in that section reconciliations of these measures in specific periods to their most directly comparable financial measure calculated and presented in accordance with U.S. GAAP for those periods.


1 Local currency percentage change is calculated by comparing current period results at prior period exchange rates versus prior period results.


2 Fee revenue is gross revenue less both client reimbursed costs largely associated with employees that are dedicated to client facilities and subcontracted vendor work performed for clients.


3 Adjusted net income and adjusted earnings per share (or adjusted EPS) include the impact of adjusting provision for income taxes to a normalized rate as well as exclude the effect of selected charges from U.S. GAAP net income and U.S. GAAP earnings per diluted share. Adjustments during the periods presented included the write-off of financing costs, amortization expense related to certain intangible assets attributable to acquisitions, integration and other costs related to acquisitions and certain carried interest incentive compensation expense.


4 EBITDA represents earnings before net interest expense, write-off of financing costs, income taxes, depreciation and amortization. Amounts shown for Normalized EBITDA further remove (from EBITDA) the impact of certain cash and non-cash charges related to acquisitions and certain carried interest incentive compensation expense.