CBRE GROUP INC
For the period ended Dec 31, 2024. Filed Feb 14, 2025.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2024 · Filed Feb 14, 2025
CBRE$135.51-0.6%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2023-12-31; filed 2024-02-20.
0001138118-24-000006
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2024-12-31; filed 2025-02-14.
0001138118-25-000005
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 145 previous paragraphs and 145 current paragraphs.
58 unchanged; 50 reworded; 37 added; 37 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 14 previous and 14 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (37)
Current report
The operating environment for commercial real estate improved in 2024, particularly in the second half of the year. This was most prominently evident in real estate leasing markets. A healthy economic outlook and improved return-to-office momentum made companies increasingly confident to move forward with office leasing plans. Demand was particularly strong for the highest-quality space and expanded from primary to secondary markets as the year progressed. Improved capital availability and lower borrowing costs – along with the perception that interest rates would fall further – buoyed investor sentiment and led to increased real estate sales and financing activity in the second half of 2024. These factors also improved the operating backdrop for development and investment asset sales late in the year. Meanwhile, outsourcing services continued to gain favor with major corporations and other large occupiers of space, boosting demand for facilities and project management services.
Current report
An improved operating environment supported strong growth for CBRE in 2024. Overall, net revenue increased 14.2%. This included 14.1% net revenue growth in our resilient businesses(1) (including facilities management, project management, property management, loan servicing, recurring investment management fees and valuations), and 14.3% net revenue growth in our transactional businesses(1) (property sales, leasing, mortgage origination, carried interest and incentive fees in our investment management business, and development fees).
Current report
We allocated significant capital last year on projects designed to enhance our capabilities, augment our growth profile and expand our total addressable market. Our capital deployment totaled approximately $1.8 billion, and included $1.1 billion in M&A and other strategic investments, including the acquisition of J&J Worldwide Services, a provider of outsourcing services to the U.S. federal government and Direct Line Global, which provides technical data center management. In addition, we deployed $644 million in share buybacks (repurchasing 5,110,624 shares).
Current report
The revenue increase reflected growth in leasing activity, particularly for office and retail space, commercial mortgage origination, loan servicing, property management, and continued strong growth in the GWS segment, which benefited from strong new business activity, contract expansions, and acquisitions. We began to see an increase in property sales in our Advisory Services segment in the second half of 2024. Revenue increased in the REI segment, driven by higher incentive and development fees.
Current report
Foreign currency translation had minimal net impact on revenue during the year ended December 31, 2024. Foreign currency translation strength in the British pound sterling was offset by weakness in the Japanese yen.
Current report
Cost of revenue increased 12.2%, during the year ended December 31, 2024 as compared to the same period in 2023 due to revenue growth, consisting of higher pass-through costs, higher compensation, and higher indirect reimbursed costs. Foreign currency translation had a 0.1% positive impact on total cost of revenue. Cost of revenue increased slightly to 80.6% of total revenue from 80.4% driven by higher costs to support growth in revenues.
Current report
Operating, administrative and other expenses increased 9.8% as compared to the same period last year. The increase was driven by an increase in restructuring and indirect tax expenses this year compared to 2023 as the cost savings initiatives in the GWS segment were largely completed. Foreign currency translation had a 0.1% positive impact on total operating expenses during the year ended December 31, 2024. Operating expenses as a percentage of revenue decreased to 14.0% from 14.3%, as operating expenses grew slower than revenue.
Current report
Depreciation and amortization expense increased by 8.4% during the year ended December 31, 2024, as compared to the same period in 2023, reflecting higher depreciation and amortization expense related to assets acquired from recent acquisitions such as J&J Worldwide Services.
Current report
Gain on disposition of real estate increased by $115 million in 2024, driven by the monetization of real estate development assets in the REI segment.
Current report
We incurred an equity loss of $19 million in 2024 compared to equity income of $248 million in the same period in 2023. This was mainly due to an unusually large development asset disposition in the first-quarter 2023 that did not recur in 2024. In addition, we recorded higher unrealized net losses related to our non-core strategic equity investments, including Altus Power, Inc. (Altus), during the year ended December 31, 2024. These losses were partially offset by equity income recognized in relation to investments in TCC real estate development projects.
Current report
Other income decreased to $39 million from $61 million, driven primarily by a one-time gain of approximately $34 million recognized in 2023 associated with the remeasurement of an investment in an unconsolidated subsidiary to fair value as of the date the remaining controlling interest was acquired. This decrease was partially offset by positive fair value adjustments on certain financial instruments this year as compared to the same period last year.
Current report
Interest expense, net of interest income, increased 44.3% in 2024 as compared to the same period 2023. This increase was primarily due to the issuance of new debt during the first quarter of 2024, the impact of higher interest rates, and increased borrowings on the revolving credit and commercial paper facilities.
Current report
In early January 2025, we combined our project management business with our Turner & Townsend majority-owned subsidiary and will publicly report financial results for a fourth business segment, Project Management, beginning in the first quarter of 2025. In addition, we acquired full ownership of Industrious, a provider of premium flexible workplace solutions in January 2025, and will establish a new business segment, Building Operations & Experience, in 2025, comprised of enterprise and local facilities management, property management and flexible workplace solutions. Our four business segments beginning in 2025 will be (1) Advisory Services; (2) Building Operations & Experience; (3) Project Management; and (4) Real Estate Investments.
Current report
Revenue increased 13.0% in 2024 as compared to the same period in 2023. Global leasing revenue rose 12.2% driven by the Americas which grew 13.3%, including 15.8% in the United States, APAC which grew 10.6% and the United Kingdom, which grew 10.5%. Property sales revenue was up 10.1%, reflecting an increase in property sales in the second half of 2024. The company’s loan origination business benefited from higher loan fees, partially offset by a decrease in interest earnings on escrow balances. Property management also grew solidly, up 15.4%, fueled by growth across regions and in the U.S. and continued growth from the Brookfield portfolio. Foreign currency translation had a 0.2% negative impact on total revenue in 2024, primarily driven by weakness in the Japanese yen and Brazilian real, partially offset by strength in the British pound sterling.
Current report
Cost of revenue increased 13.8%, primarily reflecting business growth, higher reimbursable expenses in property management, higher professional compensation and higher commission expense. Foreign currency translation had a 0.1% positive impact on cost of revenue. Cost of revenue slightly increased to 61.0% of total revenue from 60.6% for the same period in 2023 primarily due to higher commissions, driven by revenue growth.
Current report
Operating, administrative and other expenses slightly increased by 1.1%, in 2024 as compared to the same period in 2023, driven by higher variable employee compensation costs. The increase was partially offset by lower restructuring expenses as the Advisory Services segment recorded significant restructuring expenses in the first half of 2023, as the segment went through cost reduction initiatives that did not recur this year. Foreign currency translation had a 0.2% positive impact on total operating expenses.
Current report
For the year ended December 31, 2024, MSRs contributed $123 million to operating income, offset by $138 million of amortization of related intangible assets. For the year ended December 31, 2023, MSRs contributed $84 million to operating income, offset by $144 million of amortization of related intangible assets. The increase was associated with higher origination activity given an increase in financing activities in the second half of 2024.
Current report
Depreciation and amortization expense decreased 5.9% primarily due to lower amortization of mortgage servicing rights as described above and due to accelerated depreciation expense recorded in the first half of 2023, as part of cost savings initiatives that did not recur this year.
Current report
Revenue increased 11.7% in 2024 as compared to 2023, reflecting a double-digit increase in facilities management, led by the Enterprise and Local business, and growth in project management due to continued strong growth from Turner & Townsend. Foreign currency translation had minimal net impact on total revenue during the year ended December 31, 2024. Foreign currency translation weakness in the Japanese yen was partially offset by strength in the British pound sterling.
Current report
Operating, administrative and other expenses increased 6.8%, primarily due to restructuring charges incurred related to cost savings initiatives and the inclusion of J&J Worldwide Services’ operating results since acquisition at the end of February 2024. Foreign currency translation had minimal net impact on total operating expenses in 2024.
Current report
Depreciation and amortization expense increased 26.7%, primarily due to increased amortization expense on intangibles related to the J&J Worldwide Services and certain other in-fill acquisitions.
Current report
Revenue increased 9.0% in 2024 as compared to 2023. This reflected an increase in incentive fees in our investment management business and higher construction management fees in our development services business. Foreign currency translation had a 0.9% positive impact on total revenue during the year ended December 31, 2024, primarily driven by strength in British pound sterling.
Current report
Cost of revenue increased 20.4% in 2024 as compared to the same period in 2023 due to higher construction and consulting costs incurred on our real estate development projects. Foreign currency translation had a 3.2% negative impact on total cost of revenue during the year ended December 31, 2024.
Current report
Operating, administrative and other expenses increased 9.9%, primarily due to an increase in incentive compensation in our development services and investment management line of business consistent with higher revenue growth, partially offset by lower bonus expense to align with overall segment performance, and a decrease in charges associated with the company’s efficiency and cost-reduction initiatives. Foreign currency translation had a 0.6% negative impact on total operating expenses in 2024.
Current report
Gain on disposition of real estate increased by $115 million compared to the same period in 2023 due primarily to gains recognized upon monetization of real estate development projects.
Current report
We recorded equity income from unconsolidated subsidiaries of approximately $117 million in 2024 as compared to equity income of $216 million in the same period in 2023, which included an unusually large gain on a development portfolio asset sale.
Current report
Operating, administrative and other expenses for our core corporate function rose 57.5%, to $723 million in 2024, mainly due to an increase in our provision related to indirect taxes, increased charges associated with employee separation and integration and other costs related to acquisitions. In addition, we recorded higher incentive compensation expense reflecting improved business performance.
Current report
We recorded equity loss of approximately $134 million in 2024 versus an equity income of $27 million in 2023. This reflects lower value of our investments, primarily driven by our investments in Altus and Industrious, partially offset by equity income from investments in other unconsolidated subsidiaries.
Current report
We had an estimated liability of approximately $204 million (of which $102 million was current) and $192 million (of which $82 million was current) as of December 31, 2024 and 2023, respectively, related to the remediation efforts. We recognized additional provision in the year ended December 31, 2024 based on additional information obtained and evaluations performed allowing for a more refined estimate on a building-by-building basis.
Current report
Net cash provided by operating activities totaled $1,708 million for the year ended December 31, 2024 as compared to $480 million in the prior year. The primary drivers that contributed to the increase in net cash provided by operating activities were as follows: (1) higher net cash flows from operations, driven by revenue growth and (2) working capital improvements, driven by timing of payment of accounts payable and accrued expenses and lower accounts receivable.
Current report
Net cash used in investing activities totaled $1,514 million for the year ended December 31, 2024, an increase of $833 million as compared to the year ended December 31, 2023. The increase was primarily due to the acquisition of J&J Worldwide Services in February 2024 and Direct Line Global in June 2024.
Current report
Net cash used in financing activities totaled $221 million for the year ended December 31, 2024 as compared to net cash provided by financing activities of $154 million for the year ended December 31, 2023. The increased outflow was primarily driven by higher payments of deferred purchase consideration, share repurchase, and taxes on equity awards; partially offset by proceeds from our commercial paper program, net proceeds from the revolver, and lower inflows from fixed term debt financing compared to prior year.
Current report
(3)Includes forecasted interest expense. See Note 12 – Leases of the Notes to Consolidated Financial Statements set forth in Item 8 of this Annual Report.
Current report
(8)See Note 13 – Commitments and Contingencies of the Notes to Consolidated Financial Statements set forth in Item 8 of this Annual Report.
Current report
(11)See Note 22 – Telford Fire Safety Remediation of the Notes to Consolidated Financial Statements set forth in Item 8 of this Annual Report.
Current report
On February 23, 2024, CBRE Services issued $500 million in aggregate principal amount of 5.500% senior notes due April 1, 2029 (the 5.500% senior notes) at a price equal to 99.837% of their face value. The 5.500% senior notes are unsecured obligations of CBRE Services and are guaranteed on a senior basis by CBRE Group, Inc. Interest accrues at a rate of 5.500% per year and is payable semi-annually in arrears on April 1 and October 1 of each year, beginning on October 1, 2024.
Current report
On December 2, 2024, CBRE Services established a commercial paper program pursuant to which we may issue and sell up to $3.5 billion of short-term, unsecured and unsubordinated commercial paper notes with up to 397-day maturities, under the exemption from registration contained in Section 4(a)(2) of the Securities Act of 1933, as amended. Amounts available under the program may be borrowed, repaid and re-borrowed from time to time. Payment of the commercial paper notes is guaranteed on an unsecured and unsubordinated basis by CBRE Group, Inc. The program notes and the guarantee will rank pari passu with all other unsecured and unsubordinated indebtedness. The proceeds from issuances under the program may be used for general corporate purposes. The company intends to maintain available commitments under the Revolving Credit Agreement in an amount at least equal to the amount of commercial paper notes outstanding from time to time. As of December 31, 2024, we had $175 million in outstanding borrowings under the commercial paper program with a weighted average annual interest rate of 4.77%. As of February 11, 2025, we had $1.3 billion in outstanding borrowings under the commercial paper program.
Removed paragraphs (37)
Previous report
The operating environment for commercial real estate was significantly challenged in 2023. Markedly higher borrowing and constricted capital availability, particularly following the regional bank failures in March, depressed commercial real estate investment and financing and inhibited our ability to harvest gains from our real estate development and investment management portfolios. Real estate leasing markets were negatively impacted by economic uncertainty and the slow progress of company return-to-office plans, which resulted in reduced office demand, higher space availability and generally lower market rents. Demand for industrial space was firmer but down from record levels of recent years and an increase in new construction pushed up vacancy rates. Persistent inflation across the economy also required us to increase compensation expense to retain top talent and our development businesses incurred higher input costs for construction materials. On the other hand, we believe that contractual provisions in some parts of our business provide some protection against inflation.
Previous report
The real estate capital markets environment weighed on our business performance in 2023, particularly the transactional business lines within Advisory Services and Real Estate Investments segments, which are sensitive to market cycles. While overall net revenue fell 3%, our resilient business lines (including the entire GWS business, property management, loan servicing, asset management fees and valuations), together, grew net revenue at a 10% clip(1). These business lines are well-positioned for growth across market cycles. On the other hand, revenue from the transactional components of our business (sales, leasing, mortgage origination, carried interest and incentive and development fees) slumped 21% last year, but are poised to resume strong growth when the market cycle turns.
Previous report
Despite the year’s challenges, we invested approximately $961.3 million in share buybacks (repurchasing approximately 7,867,348 shares), infill M&A and other strategic investments, while ending the year below the midpoint of our target leverage range, giving us substantial liquidity to finance future growth.
Previous report
Revenue rose by $1.1 billion, or 3.6%, for the year, led by a 13.4% increase in the GWS segment, which benefited from new client wins, contract expansions, and in-fill acquisitions. Advisory Services segment revenue decreased by 14.0%, as macroeconomic uncertainty and high interest rates, curbed property leasing, sales and financing activity. These economic conditions also impacted the timing and value of asset and fund monetization in the REI segment, where revenue declined 14.2%. Foreign currency translation was a 0.5% drag on revenue, reflecting weakness in the Canadian dollar, Argentina peso and Australian dollar, partially offset by strength in the euro.
Previous report
Cost of revenue increased by $1.4 billion, or 5.9%, during the year, due to higher costs associated with our GWS segment given the growth. Cost of revenue declined in our Advisory Services and REI segments, reflecting the variable nature of much of these segments’ costs. Foreign currency translation had a 0.5% benefit to total costs. Cost of revenue as a percentage of revenue increased to 80.4% in 2023 as compared to 78.6% in 2022, largely due to a shift in revenue mix toward the GWS segment, which generally has lower gross margin. In addition, certain charges associated with our cost reduction and efficiency initiatives also contributed to an increase in cost of revenue this year.
Previous report
Operating, administrative and other expenses decreased by $87.5 million, or 1.9%, for the year, driven by lower incentive compensation in the REI segment, reflecting the overall decline in revenue. In addition, we recorded approximately $185.9 million related to Telford Homes’ fire safety remediation charges in 2022 that did not recur in 2023. GWS incurred higher infrastructure costs in support of revenue growth. Other factors weighing on expenses in 2023 include efficiency and cost reduction charges, increased professional fees associated with various capital allocation opportunities, certain legal settlement charges and higher bad debt expenses. Foreign currency translation had a 0.3% benefit on operating expenses for the year. Operating expenses as a percentage of revenue decreased to 14.3% from 15.1% in 2022, mainly due to GWS revenue outpacing operating expense growth and the Telford Homes fire safety remediation charges in 2022.
Previous report
Depreciation and amortization expense increased by $8.9 million, or 1.4%, during the year, due to continued investment in capital assets and depreciation and amortization associated with fixed assets and intangible assets acquired as part of in-fill acquisitions. These increases were partially offset by lower amortization expense compared with 2022, when loan payoffs in our Capital Markets loan servicing business increased amortization.
Previous report
We did not record any asset impairments in 2023 versus $58.7 million in 2022, including $10.4 million related to our exit of the Advisory Services business in Russia; $26.4 million for non-cash goodwill impairment and $21.9 million for non-cash trade name impairment both related to Telford Homes in our REI segment. The Telford Homes charges were attributable to the effect of elevated inflation on construction, materials and labor costs, which reduced profitability because sales prices for the build-to-rent developments were fixed at the time the developments were sold to a long-term investor.
Previous report
Gain on disposition of real estate decreased by $216.9 million in 2023. Economic uncertainty and higher interest rates constrained asset sales in the REI segment compared with significant gains in 2022.
Previous report
Equity income from unconsolidated subsidiaries increased by $19.3 million, or 8.4%, in 2023, reflecting improved equity pickups and fair value adjustments in our non-core investment portfolio this year. This was partially offset by lower equity earnings associated with property sales reported in our REI segment.
Previous report
Other income on a consolidated basis was $60.8 million in 2023 versus a loss of $11.9 million in 2022. Current-year activity primarily includes a one-time gain of approximately $34.2 million associated with remeasuring an investment in an unconsolidated subsidiary to fair value as of the date the remaining controlling interest was acquired. In addition, we also recorded approximately $6.0 million in gain upon conversion of a debt security and net favorable fair value adjustments of $7.6 million on securities portfolio owned by our wholly-owned captive insurance company during the year. Losses in 2022 were primarily due to sales of certain marketable equity securities.
Previous report
Consolidated interest expense, net of interest income, increased by $80.2 million, or 116.3%, in 2023, reflecting higher interest rates, increased borrowings on the revolving credit facilities, the issuance of new senior notes in the second quarter and borrowings on senior term loans in the third quarter of this year.
Previous report
Revenue decreased by $1.4 billion, or 14.0%, in 2023 with declines across most lines of business, except property management and loan servicing. Sales revenue fell 36.2%, mortgage origination revenue decreased 24.7%, leasing revenue declined 9.5%, and valuation revenue dropped 6.3%. A stressed lending environment made it difficult to access capital at a reasonable cost, thereby constraining capital markets activity. Property management revenue was up 3.5% due to new clients and expanded opportunities with existing clients, mainly in the U.S. Loan servicing revenue was up 1.9% given growth in the servicing portfolio, which closed 2023 at an all-time high of $410 billion. Our Americas and Europe, Middle East and Africa (EMEA) regions were more affected by the macroeconomic conditions than Asia-Pacific (APAC), where performance matched the prior year. Foreign currency translation was a 0.5% drag on revenue in 2023, primarily driven by weakness in the Japanese yen, Australian dollar and Canadian dollar, partially offset by strength in the euro.
Previous report
Cost of revenue decreased by $833.1 million, or 13.9%, in 2023 primarily due to our variable compensation structure, which saw commission expense fall in line with lower sales and leasing revenue. Foreign currency translation had a 0.5% positive impact on cost of revenue, while as a percentage of revenue, cost of revenue remained relatively flat at approximately 60% for both years. This was due to a shift in revenue composition whereby high-margin capital markets revenue decreased while lower-margin property management and loan servicing revenue increased.
Previous report
Operating, administrative and other expenses increased by $21.2 million, or 1.0%, in 2023. This slight increase resulted from employee separation benefits and lease termination charges, certain legal settlement charges, and increased bad debt expense, partially offset by lower incentive compensation expense and fixed costs that declined as a result of cost saving actions. Foreign currency translation had a 0.3% benefit on total operating expenses during the year ended December 31, 2023.
Previous report
Depreciation and amortization expense decreased mainly due to lower amortization expense compared with 2022, when loan payoffs in our Capital Markets loan servicing business increased amortization.
Previous report
Revenue increased by $2.7 billion, or 13.4%, in 2023, driven by new clients and expansion of services to existing clients, augmented by in-fill acquisitions. Foreign currency translation had a 0.5% drag on revenue in 2023, primarily driven by weakness in the Argentina peso and Canadian dollar partially offset by strength in the euro.
Previous report
Operating, administrative and other expenses increased by $161.1 million, or 14.9%, in 2023. The increase is due to higher compensation expense, higher infrastructure costs supporting business growth, charges associated with the integration of acquisitions and expenses from acquired entities. In addition, the GWS segment incurred approximately $51.6 million in charges related to employee separation benefits, lease and contract termination costs, up from $27.9 million in 2022. Foreign currency translation had a 0.5% benefit on total operating expenses in 2023.
Previous report
Depreciation and amortization expense increased by $9.2 million, or 3.6%, in 2023 due to continued investment in technology.
Previous report
Macroeconomic conditions had a significant impact on the REI segment. Less available and more expensive debt capital constrained asset and fund monetization and our ability to source new debt capital to fund development projects. Revenue decreased by $157.8 million, or 14.2%, in 2023, largely driven by fewer asset sales, primarily in our international development services markets, and lower development and construction management fees, as well as lower incentive fees. Foreign currency translation had a negligible impact on total revenue during the year ended December 31, 2023.
Previous report
Cost of revenue decreased by $136.3 million, or 42.3%, in 2023. Cost of revenue as a percent of revenue declined to 19.5% in 2023 from 29.0% in 2022, reflecting a higher proportion of revenue coming from the investment management line of business which has no associated cost of revenue. This was partially offset by cost overruns on certain U.K. residential construction projects. Foreign currency translation had a negligible impact on total cost of revenue during the year ended December 31, 2023.
Previous report
Operating, administrative and other expenses decreased by $297.8 million, or 27.5%, in 2023 due to lower incentive compensation expense and $185.9 million estimated provision related to Telford Homes’ fire and building safety remediation work in 2022, which was not repeated this year. Foreign currency translation had a 0.2% benefit on total operating expenses in 2023.
Previous report
Equity income from unconsolidated subsidiaries decreased by $164.8 million, or 43.3%, in 2023 primarily due to lower net sales of our equity interests to our joint-venture partners on development projects. Gain on disposition of real estate decreased by $216.9 million in 2023 due to fewer sales of consolidated development projects compared with a significant number of such sales, primarily land sales, in 2022.
Previous report
Operating, administrative and other expenses for our core corporate function were approximately $458.7 million in 2023, an increase of $28.6 million, or 6.7%. This was primarily due to higher professional fees as we explored various capital allocation opportunities and compensation expenses associated with certain roles that were embedded within the business segments last year but were moved to Corporate this year. This was partially offset by lower stock-based compensation expense this year.
Previous report
Other income was approximately $7.6 million in 2023 versus a loss of $12.2 million in 2022. This is primarily comprised of net activity related to unrealized and realized gain/loss on equity and available for sale debt securities owned by our wholly-owned captive insurance company. These mark-to-market adjustments were in a net unfavorable position in 2022.
Previous report
We recorded equity income of approximately $27.5 million in 2023 versus a loss of $167.3 million in 2022. This reflects improved equity pickups and fair value adjustments in our non-core investment portfolio.
Previous report
We recorded other income of $5.1 million in 2023 versus a loss of $6.6 million in 2022. Last year’s loss mainly resulted from realized losses on sale of marketable securities.
Previous report
We had an estimated liability of approximately $192.1 million (of which $82.2 million was current) and $185.9 million (of which $51.6 million was current) as of December 31, 2023 and 2022, respectively, related to the remediation efforts. We did not record any additional provision during the year ended December 31, 2023, as the above balance remains our best estimate of future losses associated with overall remediation efforts. We did not have any significant cash outflows related to this work in 2023.
Previous report
Net cash provided by operating activities totaled $479.9 million for the year ended December 31, 2023, a decrease of $1.1 billion as compared to the year ended December 31, 2022. The primary driver was significantly lower earnings this period, down approximately $400.0 million as compared to last year due to stressed macroeconomic conditions. The other key drivers that contributed to the higher usage were as follows: (1) net outflow associated with net working capital; the net working capital change was mainly due to lagged collection of receivables, higher outflow related to net bonus payments due to overall decrease in bonus expense recorded in 2023 as compared to 2022, compensation and other employee benefits this year, (2) certain non-cash charges (such as lower share-based compensation expense in 2023, net realized gain recorded on our equity and available for sale debt portfolio, net gain recorded upon acquisition of the remaining interest in a previously unconsolidated subsidiary) that contributed to the net outflow this year, and (3) lower net equity distribution from unconsolidated subsidiaries, mainly in REI where less available and more expensive debt capital constrained asset and fund monetization. These were partially offset by lower MSR revenue, which are non-cash in nature, recorded in current year as compared to prior year.
Previous report
Net cash used in investing activities totaled $681.0 million for the year ended December 31, 2023, a decrease of $151.4 million as compared to the year ended December 31, 2022. This decrease was primarily driven by lower net contributions to unconsolidated subsidiaries due to constrained funding and monetization of real estate projects, as compared to the year ended December 31, 2022, and a net investment in View the Space, Inc. (VTS) last year that did not recur this year. This was partially offset by higher capital expenditures compared to 2022 as we continue to invest in our platform and infrastructure, higher spend on in-fill acquisitions, and net outflows associated with our consolidated real estate projects, during this period as compared to the year ended December 31, 2022.
Previous report
Net cash provided by financing activities totaled $153.4 million for the year ended December 31, 2023 versus a net outflow of $1.8 billion for the year ended December 31, 2022. The increased inflow was primarily due to the net proceeds of $975.2 million from the issuance of our 5.950% senior notes, lower stock repurchase activities, and net inflows from issuance of new senior term loans and payment of prior euro term loan this period as compared to the same period last year. This was partially offset by $110.8 million in increased outflow related to acquisitions where cash was paid after 90 days of the acquisition date and net outflows related to our short-term borrowings.
Previous report
(3)See Note 12 of the Notes to Consolidated Financial Statements set forth in Item 8 of this Annual Report.
Previous report
(8)See Note 13 of the Notes to Consolidated Financial Statements set forth in Item 8 of this Annual Report.
Previous report
(11)See Note 22 of the Notes to Consolidated Financial Statements set forth in Item 8 of this Annual Report.
Previous report
(1)Increase in non-current assets is due to legal entity restructurings that were executed at December 31, 2023.
Previous report
Subsequent Event
Previous report
On February 5, 2024, we announced a definitive agreement to acquire J&J Worldwide Services, a leading provider of engineering services, base support operations and facilities maintenance for the U.S. federal government, from Arlington Capital Partners, a private investment firm. The consideration consists of (i) an initial purchase price of $800 million, payable in cash at closing of the acquisition, plus (ii) a potential earn-out of up to $250 million, payable in cash in 2027 contingent on the acquired business meeting certain performance thresholds. Closing of the acquisition is expected to occur in Q1 2024, subject to obtaining applicable regulatory clearances and the satisfaction of other customary closing conditions.
Reworded paragraphs (50)
Previous wording
CBRE is the world’s largest commercial real estate services and investment firm (based on 2023 revenue). We serve clients through three business segments – Advisory Services, Global Workplace Solutions (GWS) and Real Estate Investments (REI) – which are described in “Item 1. Business.” We generate revenue from both stable, resilient sources (large multi-year portfolio and per-project contracts) and non-recurring sources, including commissions on transactions. Our revenue mix has become more weighted towards resilient revenue sources, particularly occupier outsourcing, and our dependence on cyclical property sales and lease transaction revenue has declined. Transactional revenue and earnings within our Advisory Services segment (notably property sales and leasing) have historically been highest in the year’s fourth quarter due to the focus on completing transactions prior to year-end. However, our consolidated results have become less seasonal in recent years, as our reliance on transactional revenue has decreased.
Current wording
CBRE is the world’s largest commercial real estate services and investment firm (based on 2024 revenue). In 2024, we served clients through three business segments – Advisory Services, Global Workplace Solutions (GWS) and Real Estate Investments (REI) – which are described in “Item 1. Business” in this Annual Report. We generate revenue from both resilient sources (large multi-year portfolio and per-project contracts) and non-recurring sources, including commissions generated by transactions. Our revenue mix has become more weighted towards resilient revenue sources, particularly occupier outsourcing, and our dependence on cyclical property sales and lease transaction revenue has declined. Non-recurring transactional revenue and earnings within our Advisory Services segment (notably property sales and leasing) have historically been highest in the year’s fourth quarter due to a focus on completing transactions prior to year-end, but such seasonality has decreased as transactions have comprised a smaller proportion of our total revenue.
Previous wording
The following presents highlights of CBRE’s performance for the year ended December 31, 2023:
Current wording
The following presents highlights of CBRE’s performance for the year ended December 31, 2024 (percentages represent comparison to 2023 results):
Previous wording
We reported consolidated net income of $985.7 million for the year ended December 31, 2023 on revenue of $31.9 billion as compared to consolidated net income of $1.4 billion on revenue of $30.8 billion for the year ended December 31, 2022.
Current wording
We reported consolidated net income of $968 million for the year ended December 31, 2024 on revenue of $35.8 billion as compared to consolidated net income of $986 million on revenue of $31.9 billion for the year ended December 31, 2023.
Previous wording
Our provision for income taxes on a consolidated basis was $249.5 million for the year ended December 31, 2023 as compared to $234.2 million in 2022. Our effective tax rate increased to 19.5% in 2023 from 14.1% in 2022. The increase is primarily due to the one-time benefit in 2022 related to the outside basis differences recognized as a result of a legal entity restructuring.
Current wording
Our provision for income taxes on a consolidated basis was $182 million for the year ended December 31, 2024 as compared to $250 million in 2023. Our effective tax rate decreased to 15.0% in 2024 from 19.5% in 2023. The decrease is primarily related to the reversal of unrecognized tax positions.
Previous wording
The Organization for Economic Co-operation & Development (OECD) Pillar Two Model Rules established a minimum global effective tax rate of 15% on country-by-country profits of large multinational companies. European Union member states along with many other countries adopted or expected to adopt the OECD Pillar Two Model effective January 1, 2024 or thereafter. The OECD and other countries continue to publish guidelines and legislation which include transition and safe harbor rules. We continue to monitor new legislative changes and assess the global impact of the Pillar Two Model Rules. Based on our initial assessment we anticipate Pillar Two top-up taxes to be immaterial.
Current wording
The Organization for Economic Co-operation & Development (OECD) Pillar Two Model Rules established a minimum global effective tax rate of 15% on country-by-country profits of large multinational companies. European Union member states along with many other countries adopted or expect to adopt the OECD Pillar Two Model effective January 1, 2024 or thereafter. The OECD and other countries continue to publish guidelines and legislation which include transition and safe harbor rules. We continue to monitor new legislative changes and assess the global impact of the Pillar Two Model Rules. The impact of Pillar Two top-up taxes was insignificant for 2024.
Previous wording
We organize our operations around, and publicly report our financial results on, three global business segments: (1) Advisory Services; (2) Global Workplace Solutions; and (3) Real Estate Investments. We also have a Corporate and other segment. For additional information on our segments, see Note 19 of the Notes to Consolidated Financial Statements set forth in Item 8 of this Annual Report.
Current wording
As of December 31, 2024, our operations were organized around, and we publicly report financial results for, three global business segments: (1) Advisory Services; (2) Global Workplace Solutions; and (3) Real Estate Investments. We also have a Corporate and Other segment. For additional information on our segments, see Note 19 – Segments of the Notes to Consolidated Financial Statements set forth in Item 8 of this Annual Report.
Previous wording
In connection with the origination and sale of mortgage loans for which the company retains servicing rights, we record servicing assets or liabilities based on the fair value of the retained mortgage servicing rights (MSRs) on the date the loans are sold. Upon origination of a mortgage loan held for sale, the fair value of the mortgage servicing rights to be retained is included in the forecasted proceeds from the anticipated loan sale and results in a net gain (which is reflected in revenue). Subsequent to the initial recording, MSRs are amortized (within amortization expense) and carried at the lower of amortized cost or fair value in other intangible assets in the accompanying consolidated balance sheets. They are amortized in proportion to and over the estimated period that the servicing income is expected to be received. For the year ended December 31, 2023, MSRs contributed to operating income $83.8 million of gains recognized in conjunction with the origination and sale of mortgage loans, offset by $144.0 million of amortization of related intangible assets. For the year ended December 31, 2022, MSRs contributed $134.1 million of gains recognized in conjunction with the origination and sale of mortgage loans, offset by $163.7 million of amortization of related intangible assets. The decrease in gains was associated with lower origination activity given the higher cost of debt.
Current wording
In connection with the origination and sale of mortgage loans with servicing rights retained, we record servicing assets or liabilities based on the fair value of mortgage servicing rights (MSRs) on the date the loans are sold. Upon origination of a mortgage loan held for sale, the fair value of the mortgage servicing rights to be retained is included in the forecasted proceeds from the anticipated loan sale and results in a net gain (which is reflected in revenue). Our MSRs are initially recorded at fair value. Subsequent to the initial recording, MSRs are amortized in proportion to and over the period that the servicing income is expected to be received based on projections and timing of estimated future net cash flows and assessed for impairment based on the fair value each reporting period.
Previous wording
Other income was $46.2 million in 2023 versus $1.4 million in 2022. Current-year activity primarily includes a one-time gain of approximately $34.2 million associated with remeasuring an investment in an unconsolidated subsidiary to fair value as of the date the remaining controlling interest was acquired.
Current wording
Other income was $5 million in 2024 versus $46 million in 2023. In 2023, we recognized a one-time gain of approximately $34 million associated with remeasuring an investment in an unconsolidated subsidiary to fair value as of the date the remaining controlling interest was acquired.
Previous wording
Cost of revenue increased by $2.4 billion, or 13.4%, in 2023, driven by higher pass-through costs and increased professional compensation. Foreign currency translation had a 0.5% benefit on total cost of revenue in 2023. Cost of revenue as a percentage of revenue remained flat at 90.4% in 2023 and 2022 primarily due to an increase in project management revenue, which generally has higher margins, partially offsetting the impact of higher pass-through costs.
Current wording
Cost of revenue increased 11.6%, driven by higher pass-through costs, higher indirect reimbursed costs, and increased professional compensation to support the growth in the business. Foreign currency translation had a 0.1% positive impact on total cost of revenue. Cost of revenue was 90.3% of total revenue, a slight decrease from 90.4% in 2023.
Previous wording
AUM generally refers to the properties and other assets with respect to which we provide (or participate in) oversight, investment management services and other advice, and which generally consist of real estate properties or loans, securities portfolios and investments in operating companies and joint ventures. Our AUM is intended principally to reflect the extent of our presence in the real estate market, not the basis for determining our management fees. Our assets under management consist of:
Current wording
AUM generally refers to the properties and other assets with respect to which we provide (or participate in) oversight, investment management services and other advice, and which generally consist of real estate properties or loans, securities portfolios and investments in operating companies and joint ventures. Our AUM is intended principally to reflect the extent of our presence in the real estate market, not to be the basis for determining our management fees. Our assets under management consist of:
Previous wording
We believe that we can satisfy our working capital and funding requirements with internally generated cash flow and, as necessary, borrowings under our revolving credit facilities. Our expected capital requirements for 2024 include up to $319.9 million of anticipated capital expenditures, net of tenant concessions. During the year ended December 31, 2023, we incurred $293.2 million of capital expenditures, net of tenant concessions received. As of December 31, 2023, we had aggregate future commitments of $180.4 million related to co-investments funds in our Real Estate Investments segment, $128.0 million of which is expected to be funded in 2024. Additionally, as of December 31, 2023, we are committed to fund additional capital of $230.1 million and $73.9 million to consolidated and unconsolidated projects, respectively, within our Real Estate Investments segment. As of December 31, 2023, we had $3.7 billion of borrowings available under our revolving credit facilities (under both the Revolving Credit Agreement, as described below, and the Turner & Townsend revolving credit facility) and $1.3 billion of cash and cash equivalents.
Current wording
We believe that we can satisfy our working capital and funding requirements with internally generated cash flow and, as necessary, borrowings under our revolving credit facilities and commercial paper program. Our expected capital requirements for 2025 include up to $360 million of anticipated capital expenditures, net of tenant concessions. During the year ended December 31, 2024, we incurred $279 million of capital expenditures, net of tenant concessions received. As of December 31, 2024, we had aggregate future commitments of $205 million related to co-investments funds in our REI segment, $74 million of which is expected to be funded in 2025. Additionally, as of December 31, 2024, we are committed to fund additional capital of $330 million and $67 million to consolidated and unconsolidated projects, respectively, within our REI segment. As of December 31, 2024, we had $3.3 billion of borrowings available under our revolving credit facilities (under both the Revolving Credit Agreement, as described below, and the Turner & Townsend revolving credit facility) and $1.1 billion of cash and cash equivalents. We intend to maintain available commitments under the Revolving Credit Agreement in an amount at least equal to the amount of commercial paper notes outstanding from time to time. As of December 31, 2024, we had $175 million in outstanding borrowings under the commercial paper program.
Previous wording
The second long-term liquidity need is the payment of obligations related to acquisitions. Our acquisition structures often include deferred and/or contingent purchase consideration in future periods that are subject to the passage of time or achievement of certain performance metrics and other conditions. As of December 31, 2023 and 2022, we had accrued deferred purchase consideration totaling $530.2 million ($264.1 million of which was a current liability) and $574.3 million ($117.3 million of which was a current liability), respectively, which was included in “Accounts payable and accrued expenses” and in “Other long-term liabilities” in the accompanying consolidated balance sheets set forth in Item 8 of this Annual Report.
Current wording
The second long-term liquidity element is the payment of obligations related to acquisitions. Our acquisition structures often include deferred and/or contingent purchase consideration in future periods that are subject to the passage of time or achievement of certain performance metrics and other conditions. As of December 31, 2024 and 2023, we had accrued deferred purchase consideration totaling $292 million ($199 million of which was a current liability) and $530 million ($264 million of which was a current liability), respectively, which was included in “Accounts payable and accrued expenses” and in “Other long-term liabilities” in the accompanying consolidated balance sheets set forth in Item 8 of this Annual Report.
Previous wording
Lastly, as described in Note 16 of the Notes to Consolidated Financial Statements set forth in Item 8 of this Annual Report, in November 2021, our board of directors authorized a program for the company to repurchase up to $2.0 billion of our Class A common stock over five years, effective November 19, 2021 (the 2021 program). In August 2022, our board of directors authorized an additional $2.0 billion, bringing the total authorized repurchase amount under the 2021 program to a total of $4.0 billion. During the year ended December 31, 2023, we repurchased 7,867,348 shares of our Class A common stock with an average price of $82.59 per share using cash on hand for an aggregate of $649.8 million. As of December 31, 2023, we had $1.5 billion of capacity remaining under the 2021 program.
Current wording
Lastly, as described in Note 16 – Stockholders’ Equity of the Notes to Consolidated Financial Statements set forth in Item 8 of this Annual Report, in November 2024, our Board of Directors (Board) authorized an additional $5.0 billion to our existing $4.0 billion share repurchase program (as amended, the 2024 program) bringing the total authorized amount under the 2024 program to a total of $9.0 billion as of December 31, 2024. The Board also extended the term of the 2024 program through December 31, 2029. During the year ended December 31, 2024, we repurchased 5,110,624 shares of our Class A common stock with an average price of $126.02 per share using cash on hand for an aggregate of $644 million. During the period January 1, 2025 through February 11, 2025, we repurchased 2,060,012 shares of our Class A common stock with an average price of $132.38 per share using cash on hand for an aggregate of $273 million. As of December 31, 2024 and February 11, 2025, we had $5.8 billion and $5.5 billion, respectively, of capacity remaining under the 2024 program.
Previous wording
As more fully described in Note 22 of the Notes to Consolidated Financial Statements set forth in Item 8 of this Annual Report, on March 16, 2023, Telford Homes entered into a legally binding agreement with the U.K. government, under which Telford Homes will (1) take responsibility for performing or funding remediation works relating to certain life-critical fire-safety issues on all Telford Homes-constructed buildings of 11 meters in height or greater in England constructed in the last 30 years (in-scope buildings) and (2) withdraw Telford Homes-developed buildings from the government-sponsored Building Safety Fund (BSF) and Aluminum Composite Material (ACM) Funds or reimburse the government funds for the cost of remediation of in-scope buildings.
Current wording
As more fully described in Note 22 – Telford Fire Safety Remediation of the Notes to Consolidated Financial Statements set forth in Item 8 of this Annual Report, on March 16, 2023, Telford Homes entered into a legally binding agreement with the U.K. government, under which Telford Homes will (1) take responsibility for performing or funding remediation works relating to certain life-critical fire-safety issues on all Telford Homes-constructed buildings of 11 meters in height or greater in England constructed in the last 30 years (in-scope buildings) and (2) withdraw Telford Homes-developed buildings from the government-sponsored Building Safety Fund (BSF) and Aluminum Composite Material (ACM) Funds or reimburse the government funds for the cost of remediation of in-scope buildings.
Previous wording
The table above excludes estimated payment obligations for our qualified defined benefit pension plans. For information about our future estimated payment obligations for these plans, see Note 14 of the Notes to Consolidated Financial Statements set forth in Item 8 of this Annual Report.
Current wording
The table above excludes estimated payment obligations for our qualified defined benefit pension plans. For information about our future estimated payment obligations for these plans, see Note 14 – Employee Benefit Plans of the Notes to Consolidated Financial Statements set forth in Item 8 of this Annual Report.
Previous wording
(1)Reflects gross outstanding long-term debt balances as of December 31, 2023, assumed to be paid at maturity, excluding unamortized discount, premium and deferred financing costs. See Note 11 of the Notes to Consolidated Financial Statements set forth in Item 8 of this Annual Report. Figures do not include scheduled interest payments. Assuming each debt obligation is held until maturity, we estimate that we will make $965.6 million of interest payments, $144.8 million of which will be made in 2024.
Current wording
(1)Reflects gross outstanding long-term debt balances as of December 31, 2024, assumed to be paid at maturity, excluding unamortized discount, premium and deferred financing costs. See Note 11 – Long-Term Debt and Short-Term Borrowings of the Notes to Consolidated Financial Statements set forth in Item 8 of this Annual Report. Figures do not include scheduled interest payments. Assuming each debt obligation is held until maturity, we estimate that we will make $918 million of interest payments, $164 million of which will be made in 2025.
Previous wording
(2)The majority of this balance represents our warehouse lines of credit, which are recourse only to our wholly-owned subsidiary CBRE Capital Markets, Inc. (CBRE Capital Markets) and are secured by our related warehouse receivables. See Notes 5 and 11 of the Notes to Consolidated Financial Statements set forth in Item 8 of this Annual Report.
Current wording
(2)The majority of this balance represents our warehouse lines of credit, which are recourse only to our wholly-owned subsidiary CBRE Capital Markets, Inc. (CBRE Capital Markets) and are secured by our related warehouse receivables. See Note 5 – Warehouse Receivables & Warehouse Lines of Credit and Note 11 – Long-Term Debt and Short-Term Borrowings of the Notes to Consolidated Financial Statements set forth in Item 8 of this Annual Report.
Previous wording
(4)Reflects gross outstanding notes payable on real estate as of December 31, 2023 (none of which is recourse to us, beyond being recourse to the single-purpose entity that held the real estate asset and was the primary obligor on the note payable), assumed to be paid at maturity, excluding unamortized deferred financing costs. Amounts do not include scheduled interest payments. The notes have either fixed or variable interest rates, ranging from 3.00% to 9.00% at December 31, 2023.
Current wording
(4)Reflects gross outstanding notes payable on real estate as of December 31, 2024 ($9 million of which is recourse to us, beyond being recourse to the single-purpose entity that held the real estate asset and was the primary obligor on the note payable), assumed to be paid at maturity, excluding unamortized deferred financing costs. Amounts do not include scheduled interest payments. The notes have either fixed or variable interest rates, ranging from 3.0% to 8.1% at December 31, 2024.
Previous wording
(6)Represents outstanding reserves for claims under certain insurance programs, which are included in other current and other long-term liabilities in the consolidated balance sheets at December 31, 2023 set forth in Item 8 of this Annual Report. Due to the nature of this item, payments could be due at any time upon the occurrence of certain events. Accordingly, the entire balance has been reflected as expiring in less than one year.
Current wording
(6)Represents outstanding reserves for claims under certain insurance programs, which are included in other current and other long-term liabilities in the consolidated balance sheets as of December 31, 2024 set forth in Item 8 of this Annual Report. While $4 million of the $197 million in claim payments are expected to be payable within one year, due to the nature of this item, claim payments representing the remaining balance of $193 million could be due at any time upon the occurrence of certain events. Accordingly, the entire balance has been reflected as expiring in less than one year.
Previous wording
(7)As of December 31, 2023, we have a remaining federal tax liability of $54.8 million associated with the Transition Tax on mandatory deemed repatriation of cumulative foreign earnings as of December 31, 2017. We are paying the federal tax liability for the Transition Tax in annual interest-free installments over a period of eight years through 2025 as allowed by the Tax Act. The next installment is due in 2024 for the 2023 fiscal year.
Current wording
(7)As of December 31, 2024, we have a remaining federal tax liability of $30 million associated with the Transition Tax on mandatory deemed repatriation of cumulative foreign earnings as of December 31, 2017. We are paying the federal tax liability for the Transition Tax in annual interest-free installments over a period of eight years through 2025 as allowed by the Tax Act. The next installment is due in 2025 for the 2024 fiscal year.
Previous wording
In addition, as of December 31, 2023, the total amount of gross unrecognized tax benefits totaled $413.5 million. Of this amount, we expect an insignificant amount of cash settlement in less than one year. See Note 15 of the Notes to Consolidated Financial Statements set forth in Item 8 of this Annual Report.
Current wording
In addition, as of December 31, 2024, the total amount of gross unrecognized tax benefits totaled $347 million. Of this amount, we expect an insignificant amount of cash settlement in less than one year. See Note 15 – Income Taxes of the Notes to Consolidated Financial Statements set forth in Item 8 of this Annual Report.
Previous wording
(9)Includes $180.4 million to fund future co-investments in our Real Estate Investments segment, $128.0 million of which is expected to be funded in 2024, and $73.9 million committed to invest in unconsolidated real estate subsidiaries, which is callable at any time. This amount does not include capital committed to consolidated projects of $230.1 million as of December 31, 2023.
Current wording
(9)Includes $205 million to fund future co-investments in our REI segment, $74 million of which is expected to be funded in 2025, and $67 million committed to invest in unconsolidated real estate projects. This amount does not include capital committed to consolidated projects of $330 million as of December 31, 2024.
Previous wording
On July 10, 2023, CBRE Group, Inc., CBRE Services, Inc. (CBRE Services) and Relam Amsterdam Holdings B.V., a wholly-owned subsidiary of CBRE Services, entered into a new 5-year senior unsecured Credit Agreement (the 2023 Credit Agreement) maturing on July 10, 2028, which refinanced and replaced the previous credit agreement. The 2023 Credit Agreement provides for a senior unsecured term loan credit facility comprised of (i) tranche A Euro-denominated term loans in an aggregate principal amount of €366.5 million and (ii) tranche A U.S. Dollar-denominated term loans in an aggregate principal amount of $350.0 million with weighted average interest rate of 5.8% as of December 31, 2023, both requiring quarterly principal payments beginning on December 31, 2024 and continuing through maturity on July 10, 2028. The proceeds of the term loans under the 2023 Credit Agreement were applied to the repayment of all remaining outstanding senior term loans, approximately $437.5 million, under the previous credit agreement, the payment of related fees and expenses and other general corporate purposes.
Current wording
On July 10, 2023, CBRE Group, Inc., CBRE Services, Inc. (CBRE Services) and Relam Amsterdam Holdings B.V., a wholly-owned subsidiary of CBRE Services, entered into a new 5-year senior unsecured Credit Agreement (2023 Credit Agreement) maturing on July 10, 2028, which refinanced and replaced the previous credit agreement. The 2023 Credit Agreement provides for a senior unsecured term loan credit facility comprised of (i) tranche A Euro-denominated term loans in an aggregate principal amount of €367 million and (ii) tranche A U.S. Dollar-denominated term loans in an aggregate principal amount of $350 million with weighted average interest rate of 4.9% as of December 31, 2024, both requiring quarterly principal payments beginning on December 31, 2024 and continuing through maturity on July 10, 2028. The proceeds of the term loans under the 2023 Credit Agreement were applied to the repayment of all remaining outstanding senior term loans, approximately $437 million, under the previous credit agreement, the payment of related fees and expenses and other general corporate purposes.
Previous wording
The term loan borrowings under the 2023 Credit Agreement are guaranteed on a senior basis by CBRE Group, Inc. and CBRE Services.
Current wording
The term loan borrowings under the 2023 Credit Agreement are fully and unconditionally guaranteed on a senior basis by CBRE Group, Inc. and CBRE Services.
Previous wording
On June 23, 2023, CBRE Services issued $1.0 billion in aggregate principal amount of 5.950% senior notes due August 15, 2034 (the 5.950% senior notes) at a price equal to 98.174% of their face value. The 5.950% senior notes are unsecured obligations of CBRE Services, senior to all of its current and future subordinated indebtedness, but effectively subordinated to its current and future secured indebtedness (if any) to the extent of the value of the assets securing such indebtedness. The 5.950% senior notes are guaranteed on a senior basis by CBRE Group, Inc. Interest accrues at a rate of 5.950% per year and is payable semi-annually in arrears on February 15 and August 15 of each year, beginning on February 15, 2024. The amount of the 5.950% senior notes, net of unamortized discount and unamortized debt issuance costs, included in the accompanying consolidated balance sheet was $973.7 million at December 31, 2023.
Current wording
On June 23, 2023, CBRE Services issued $1.0 billion in aggregate principal amount of 5.950% senior notes due August 15, 2034 (the 5.950% senior notes) at a price equal to 98.174% of their face value. The 5.950% senior notes are unsecured obligations of CBRE Services and are guaranteed on a senior basis by CBRE Group, Inc. Interest accrues at a rate of 5.950% per year and is payable semi-annually in arrears on February 15 and August 15 of each year.
Previous wording
On March 18, 2021, CBRE Services issued $500.0 million in aggregate principal amount of 2.500% senior notes due April 1, 2031 (the 2.500% senior notes) at a price equal to 98.451% of their face value. The 2.500% senior notes are unsecured obligations of CBRE Services and are guaranteed on a senior basis by CBRE Group, Inc. Interest accrues at a rate of 2.500% per year and is payable semi-annually in arrears on April 1 and October 1 of each year. The amount of the 2.500% senior notes, net of unamortized discount and unamortized debt issuance costs, included in the accompanying consolidated balance sheet was $490.4 million and $489.3 million at December 31, 2023 and 2022, respectively.
Current wording
On March 18, 2021, CBRE Services issued $500 million in aggregate principal amount of 2.500% senior notes due April 1, 2031 (the 2.500% senior notes) at a price equal to 98.451% of their face value. The 2.500% senior notes are unsecured obligations of CBRE Services and are guaranteed on a senior basis by CBRE Group, Inc. Interest accrues at a rate of 2.500% per year and is payable semi-annually in arrears on April 1 and October 1 of each year.
Previous wording
On August 13, 2015, CBRE Services issued $600.0 million in aggregate principal amount of 4.875% senior notes due March 1, 2026 (the 4.875% senior notes) at a price equal to 99.24% of their face value. The 4.875% senior notes are unsecured obligations of CBRE Services and are guaranteed on a senior basis by CBRE Group, Inc. Interest accrues at a rate of 4.875% per year and is payable semi-annually in arrears on March 1 and September 1 of each year. The amount of the 4.875% senior notes, net of unamortized discount and unamortized debt issuance costs, included in the accompanying consolidated balance sheet was $597.5 million and $596.4 million at December 31, 2023 and 2022, respectively.
Current wording
On August 13, 2015, CBRE Services issued $600 million in aggregate principal amount of 4.875% senior notes due March 1, 2026 (the 4.875% senior notes) at a price equal to 99.24% of their face value. The 4.875% senior notes are unsecured obligations of CBRE Services and are guaranteed on a senior basis by CBRE Group, Inc. Interest accrues at a rate of 4.875% per year and is payable semi-annually in arrears on March 1 and September 1 of each year.
Previous wording
The indentures governing our 5.950% senior notes, 4.875% senior notes and 2.500% senior notes contain restrictive covenants that, among other things, limit our ability to create or permit liens on assets securing indebtedness, enter into sale/leaseback transactions and enter into consolidations or mergers.
Current wording
The indentures governing our 5.950% senior notes, 5.500% senior notes, 4.875% senior notes and 2.500% senior notes contain restrictive covenants that, among other things, limit our ability to create or permit liens on assets securing indebtedness, enter into sale/leaseback transactions and enter into consolidations or mergers.
Previous wording
Our 2023 Credit Agreement is fully and unconditionally guaranteed by CBRE Group, Inc. and CBRE Services. Our Revolving Credit Agreement, 5.950% senior notes, 4.875% senior notes and 2.500% senior notes are fully and unconditionally guaranteed by CBRE Group, Inc.
Current wording
Our 5.950% senior notes, 5.500% senior notes, 4.875% senior notes and 2.500% senior notes are fully and unconditionally guaranteed by CBRE Group, Inc.
Previous wording
(2)Includes $932.5 million and $719.3 million of intercompany loan payables to non-guarantor subsidiaries as of December 31, 2023 and 2022, respectively. All intercompany balances and transactions between CBRE Group, Inc. and CBRE Services have been eliminated.
Current wording
(1)Includes $3.3 billion and $933 million of intercompany loan payables to non-guarantor subsidiaries as of December 31, 2024 and 2023, respectively. All intercompany balances and transactions between CBRE Group, Inc. and CBRE Services have been eliminated.
Previous wording
For additional information on all of our long-term debt, see Note 11 of the Notes to Consolidated Financial Statements set forth in Item 8 of this Annual Report.
Current wording
For additional information on all of our long-term debt, see Note 11 – Long-Term Debt and Short-Term Borrowings of the Notes to Consolidated Financial Statements set forth in Item 8 of this Annual Report.
Previous wording
On August 5, 2022, we entered into a new 5-year senior unsecured Revolving Credit Agreement (the Revolving Credit Agreement). The Revolving Credit Agreement provides for a senior unsecured revolving credit facility available to CBRE Services with a capacity of $3.5 billion and a maturity date of August 5, 2027.
Current wording
On August 5, 2022, we entered into a new 5-year senior unsecured Revolving Credit Agreement (the Revolving Credit Agreement). The Revolving Credit Agreement provides for a senior unsecured revolving credit facility available to CBRE Services with commitments in an aggregate principal amount of up to $3.5 billion and a maturity date of August 5, 2027.
Previous wording
The Revolving Credit Agreement requires us to pay a fee based on the total amount of the revolving credit facility commitment (whether used or unused). In addition, the Revolving Credit Agreement also includes capacity for letters of credit not to exceed $300.0 million in the aggregate.
Current wording
The Revolving Credit Agreement requires us to pay a fee based on the total amount of the revolving credit facility commitment (whether used or unused). In addition, the Revolving Credit Agreement also includes capacity for letters of credit not to exceed $300 million in the aggregate. The Revolving Credit Agreement is fully and unconditionally guaranteed by CBRE Group, Inc.
Previous wording
As of December 31, 2023, no amount was outstanding under the Revolving Credit Agreement. No letters of credit were outstanding as of December 31, 2023. Letters of credit are issued in the ordinary course of business and would reduce the amount we may borrow under the Revolving Credit Agreement.
Current wording
As of December 31, 2024, $132 million was outstanding under the revolving credit facility provided for by the Revolving Credit Agreement. No letters of credit were outstanding as of December 31, 2024. As of February 11, 2025 and December 31, 2023, no amounts were outstanding under this revolving credit facility. Letters of credit are issued in the ordinary course of business and would reduce the amount we may borrow under this revolving credit facility.
Previous wording
In addition, Turner & Townsend maintains a £120.0 million revolving credit facility pursuant to a credit agreement dated March 31, 2022, with an additional accordion option of £20.0 million. As of December 31, 2023, $10.2 million (£8.0 million) was outstanding under this revolving credit facility and bears interest at SONIA plus 0.75%.
Current wording
In addition, Turner & Townsend maintains a £120 million revolving credit facility pursuant to a credit agreement dated March 31, 2022, with an additional accordion option of £20 million, that matures on March 31, 2027. As of December 31, 2024, $44 million (£35 million) was outstanding under this revolving credit facility and bears interest at the Sterling Overnight Index Average (SONIA) plus 0.78%. As of December 31, 2023, $10 million (£8 million) was outstanding under this revolving credit facility. As of February 11, 2025, no amount was outstanding under this revolving credit facility.
Previous wording
We also maintain warehouse lines of credit with certain third-party lenders. For additional information on all of our short-term borrowings, see Notes 5 and 11 of the Notes to Consolidated Financial Statements set forth in Item 8 of this Annual Report.
Current wording
We also maintain warehouse lines of credit with certain third-party lenders. For additional information on all of our short-term borrowings, see Note 5 – Warehouse Receivables & Warehouse Lines of Credit and Note 11 – Long-Term Debt and Short-Term Borrowings of the Notes to Consolidated Financial Statements set forth in Item 8 of this Annual Report.
Previous wording
To recognize revenue in a transaction with a customer, we evaluate the five steps of the Accounting Standards Codification (ASC) Topic 606 revenue recognition framework: (1) identify the contract; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations and (5) recognize revenue when (or as) the performance obligations are satisfied.
Current wording
To recognize revenue in a transaction with a customer, we evaluate the five steps of the Financial Accounting Standards Board (FASB)Accounting Standards Codification (ASC) Topic 606,“Revenue from Contracts with Customers”revenue recognition framework: (1) identify the contract; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations and (5) recognize revenue when (or as) the performance obligations are satisfied.
Previous wording
Our revenue recognition policies are consistent with this five step framework. Understanding the complex terms of agreements and determining the appropriate time, amount, and method to recognize revenue for each transaction requires significant judgement. These significant judgements include: (i) determining what point in time or what measure of progress depicts the transfer of control to the customer; (ii) applying the series guidance to certain performance obligations satisfied over time; (iii) estimating how and when contingencies, or other forms of variable consideration, will impact the timing and amount of recognition of revenue and (iv) determining whether we control third party services before they are transferred to the customer in order to appropriately recognize the associated fees on either a gross or net basis. The timing and amount of revenue recognition in a period could vary if different judgments were made. Our revenues subject to the most judgment are brokerage commission revenue, incentive-based management fees, development fees and third party fees associated with our occupier outsourcing and property management services. For a detailed discussion of our revenue recognition policies, see the Revenue Recognition section within Note 2 of the Notes to Consolidated Financial Statements set forth in Item 8 of this Annual Report.
Current wording
Our revenue recognition policies are consistent with this five-step framework. Understanding the complex terms of agreements and determining the appropriate time, amount, and method to recognize revenue for each transaction requires significant judgement. These significant judgements include: (i) determining what point in time or what measure of progress depicts the transfer of control to the customer; (ii) applying the series guidance to certain performance obligations satisfied over time; (iii) estimating how and when contingencies, or other forms of variable consideration, will impact the timing and amount of recognition of revenue and (iv) determining whether we control third party services before they are transferred to the customer in order to appropriately recognize the associated revenue on either a gross or net basis. The timing and amount of revenue recognition in a period could vary if different judgments were made. Our revenues subject to the most judgment are sales and lease commission revenue, incentive-based management fees, development fees and third party fees associated with our occupier outsourcing and property management services. For a detailed discussion of our revenue recognition policies, see the Revenue Recognition section within Note 2 – Significant Accounting Policies of the Notes to Consolidated Financial Statements set forth in Item 8 of this Annual Report.
Previous wording
As of December 31, 2023, our consolidated balance sheet included goodwill of $5.1 billion and other intangible assets of $2.1 billion.
Current wording
As of December 31, 2024, our consolidated balance sheets included goodwill of $5.6 billion and other intangible assets of $2.3 billion.
Previous wording
Our acquisitions require the application of purchase accounting, which results in tangible and identifiable intangible assets and liabilities of the acquired entity being recorded at fair value. The difference between the purchase price and the fair value of net assets acquired is recorded as goodwill. Assumptions must often be made in determining fair values, particularly where observable market values do not exist. Assumptions may include discount rates, growth rates, cost of capital, royalty rates, tax rates and remaining useful lives. These assumptions can have a significant impact on the value of identifiable assets and accordingly can impact the value of goodwill recorded. Different assumptions could result in different values being attributed to assets and liabilities. Since these values impact the amount of annual depreciation and amortization expense, different assumptions could also impact our statement of operations and could impact the results of future asset impairment reviews.
Current wording
Our acquisitions require the application of purchase accounting, which results in tangible and identifiable intangible assets and liabilities of the acquired entity being recorded at fair value. We engage a third-party valuation firm to assist us in identifying and determining the fair values of intangible assets acquired. The difference between the purchase price and the fair value of net assets acquired is recorded as goodwill. Assumptions must often be made in determining fair values, particularly where observable market values do not exist. Assumptions may include discount rates, growth rates, cost of capital, royalty rates, tax rates and remaining useful lives. These assumptions can have a significant impact on the value of identifiable assets and accordingly can impact the value of goodwill recorded. Different assumptions could result in different values being attributed to assets and liabilities. Since these values impact the amount of annual depreciation and amortization expense, different assumptions could also impact our statement of operations and could impact the results of future asset impairment reviews.
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