CBRE GROUP, INC.

Previous wording

Management’s Discussion and Analysis of Financial Condition and Results of Operations (MD&A) provides the reader with management’s perspective on our financial condition, results of operations, liquidity and certain other factors that may affect future results. The MD&A in this Quarterly Report on Form 10-Q (Quarterly Report) for CBRE Group, Inc. for the three and nine months ended September 30, 2025 should be read in conjunction with our consolidated financial statements and related notes included in our 2024 Annual Report on Form 10-K (2024 Annual Report) as well as the unaudited financial statements included elsewhere in this Quarterly Report.

Current wording

Management’s Discussion and Analysis of Financial Condition and Results of Operations (MD&A) provides the reader with management’s perspective on our financial condition, results of operations, liquidity and certain other factors that may affect future results. The MD&A in this Quarterly Report on Form 10-Q (Quarterly Report) for CBRE Group, Inc. for the three months ended March 31, 2026 should be read in conjunction with our consolidated financial statements and related notes included in our 2025 Annual Report on Form 10-K (2025 Annual Report) as well as the unaudited financial statements included elsewhere in this Quarterly Report.

Previous wording

The following table sets forth items derived from our consolidated statements of operations for the three and nine months ended September 30, 2025 and 2024 (dollars in millions):

Current wording

The following table sets forth items derived from our consolidated statements of operations for the three months ended March 31, 2026 and 2025 (dollars in millions):

Previous wording

We reported consolidated net income of $363 million for the quarter, on revenue of $10.3 billion as compared to consolidated net income of $225 million on revenue of $9.0 billion in the prior year.

Current wording

We reported consolidated net income of $318 million for the quarter, on revenue of $10.5 billion as compared to consolidated net income of $163 million on revenue of $8.9 billion in the prior year.

Previous wording

Foreign currency translation had a 1.7% positive impact on revenue, reflecting strength in the euro and British pound sterling partially offset by weakness in the Indian rupee.

Current wording

Foreign currency translation had a 4.0% positive impact on revenue, reflecting strength in the euro and British pound sterling partially offset by weakness in the Indian rupee.

Previous wording

Pass-through costs increased 13.3% during the quarter as compared to the same period in 2024 primarily due to revenue growth in the BOE and Project Management segments. Foreign currency translation had a 1.8% negative impact on pass-through costs.

Current wording

Pass-through costs increased 17.1% during the quarter as compared to the same period in prior year primarily due to revenue growth in the BOE and Project Management segments. Foreign currency translation had a 4.1% negative impact on pass-through costs.

Previous wording

Cost of revenue, excluding pass-through costs increased 15.8% during the quarter as compared to the same period in 2024 primarily due to revenue growth consisting of higher commission expense and employee compensation, as well as higher indirect reimbursed costs. Foreign currency translation had a 1.6% negative impact on total cost of revenue, excluding pass-through costs. Cost of revenue, excluding pass-through costs increased slightly to 39.9% of total revenue from 39.1% driven by higher costs to support growth in revenues.

Current wording

Cost of revenue, excluding pass-through costs increased 21.9% during the quarter as compared to the same period in prior year primarily reflecting business growth and higher commission expenses and employee compensation, as well as higher indirect reimbursed costs. Foreign currency translation had a 4.0% negative impact on total cost of revenue, excluding pass-through costs. Cost of revenue, excluding pass-through costs increased to 40.2% of total revenue from 39.1% driven by higher costs to support growth in revenues.

Previous wording

Operating, administrative and other expenses increased 7.4% during the quarter as compared to the same period in 2024. The increase was driven by an increase in third-party fees related to acquisitions and integration activities, along with an increase in employee compensation, driven by revenue growth. Foreign currency translation had a 1.7% negative impact on total operating expenses during the quarter. Operating, administrative and other expenses as a percentage of revenue decreased to 12.9% in the third quarter 2025 from 13.7% in the third quarter 2024, as operating expenses grew slower than revenue.

Current wording

Operating, administrative and other expenses increased 22.5% during the quarter as compared to the same period in prior year. The increase was primarily due to higher employee compensation and business promotion and advertising expense, driven by business growth. Foreign currency translation had a 4.0% negative impact on total operating expenses during the quarter. Operating, administrative and other expenses as a percentage of revenue increased to 13.9% in the first quarter 2026 from 13.4% in the first quarter 2025, as operating expenses grew higher than revenue.

Previous wording

Gain on disposition of real estate increased by $36 million during the quarter, driven by monetization of real estate development assets in the REI segment.

Current wording

Gain on disposition of real estate increased by $301 million during the quarter, driven by monetization of real estate development assets in the REI segment.

Previous wording

Interest expense, net of interest income, decreased by 21.9%, compared with the third quarter 2024. This decrease was primarily attributable to increased net investment hedging activity, offset by the impact of increased commercial paper borrowings and the issuance of senior term loans and new senior unsecured notes.

Current wording

Interest expense, net of interest income, increased by 18.0%, compared with the first quarter 2025. This increase was primarily attributable to increased commercial paper borrowings, offset by the impact of net investment hedging activity.

Previous wording

Our provision for income taxes on a consolidated basis was $91 million for the three months ended September 30, 2025 as compared to a provision for income taxes of $67 million for the three months ended September 30, 2024. The increase of $24 million is primarily related to an increase in current year earnings and favorable permanent book tax differences. Our effective tax rate decreased to 18.7% for the three months ended September 30, 2025 from 21.5% for the three months ended September 30, 2024. Our effective tax rate for the three months ended September 30, 2025 is different than the U.S. federal statutory tax rate of 21.0%, primarily due to U.S. state taxes and favorable permanent book tax differences.

Current wording

Our provision for income taxes on a consolidated basis was $112 million for the three months ended March 31, 2026 as compared to a provision for income taxes of $52 million for the three months ended March 31, 2025. The increase of $60 million is primarily related to an increase in earnings. Our effective tax rate increased to 24.7% for the three months ended March 31, 2026 from 21.4% for the three months ended March 31, 2025. Our effective tax rate for the three months ended March 31, 2026 is different than the U.S. federal statutory tax rate of 21.0% primarily due to the U.S. state taxes and permanent book tax differences.

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 for 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.

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. In January 2026, the OECD issued a comprehensive Side by Side Package, which introduces additional administrative guidance intended to enhance coordination and simplify aspects of the global minimum tax framework. The package includes several new safe harbors including the new Side by Side and Ultimate Parent Entity safe harbors that may deem certain top-up taxes to be zero in jurisdictions with qualifying minimum tax regimes, such as the United States. We will continue to monitor additional administrative guidance and legislative action to incorporate the guidance into local law to assess the global impact of the Pillar Two Model Rules. The impact of Pillar Two top-up taxes is expected to be insignificant for 2026.

Previous wording

On July 4, 2025, the U.S. Government enacted, H.R.1, the One Big Beautiful Bill Act ("OBBBA"), a budget reconciliation package that changes the U.S. federal income tax laws, including extensions of various expiring provisions from the Tax Cuts and Jobs Act of 2017. The 2025 impacts of the OBBBA are insignificant based on our current operations.

Current wording

On July 4, 2025, the U.S. federal government enacted, H.R.1, the One Big Beautiful Bill Act (OBBBA), a budget reconciliation package that changes the U.S. federal income tax laws, including extensions of various expiring provisions from the Tax Cuts and Jobs Act of 2017. The 2026 impacts of the OBBBA are insignificant based on our current operations.

Previous wording

In connection with the transactions described above, we organized our operations around, and publicly report our financial results on, four reportable business segments: (1) Advisory Services; (2) BOE; (3) Project Management; and (4) Real Estate Investments (REI).

Current wording

We organize our operations around, and publicly report our financial results for, four reportable business segments: (1) Advisory Services; (2) BOE; (3) Project Management; and (4) REI.

Previous wording

Advisory Services provides a comprehensive range of services globally, including property leasing, capital markets (property sales and loan origination), loan servicing, and valuation. BOE provides a broad suite of integrated, contractually based outsourcing services to occupiers and owners of real estate, including facilities management and property management. Our Project Management business delivers program management, project management and cost consultancy services across commercial real estate, infrastructure and natural resources sectors. REI is a major real assets developer, investor and operator and is comprised of two businesses: investment management and development services.

Current wording

Advisory Services provides a comprehensive range of services globally, including leasing, capital markets (property sales and loan origination), loan servicing, and valuation. BOE provides a broad suite of integrated, contractually based outsourcing services to occupiers and owners of real estate, including facilities management, property management and critical infrastructure. Our Project Management business delivers program management and cost consultancy services across commercial real estate, infrastructure and natural resources sectors. REI is a major real assets developer, investor and operator and is comprised of two businesses: investment management and development services.

Previous wording

We also have a Corporate and Other segment. Corporate primarily consists of corporate overhead costs. Other consists of activities from strategic non-core non-controlling equity investments and is considered an operating segment but does not meet the aggregation criteria for presentation as a separate reportable segment and is, therefore, combined with Corporate and reported as Corporate and other. It also includes eliminations related to inter-segment revenue. For additional information on our segments, see Note 16 – Segments of the Notes to Consolidated Financial Statements (Unaudited) set forth in Item 1 of this Quarterly Report.

Current wording

We also have a Corporate and Other segment. Corporate primarily consists of corporate overhead costs, and costs associated with our platform that are not allocated to segments, including corporate leadership costs. Other consists of activities from strategic non-core, non-controlling equity investments and is considered an operating segment but does not meet the aggregation criteria for presentation as a separate reportable segment and is, therefore, combined with Corporate and reported within Corporate and Other. It also includes eliminations related to inter-segment revenue. For additional information on our segments, see Note 16 – Segments of the Notes to Consolidated Financial Statements (Unaudited) set forth in Item 1 of this Quarterly Report.

Previous wording

The following table summarizes our results of operations for our Advisory Services operating segment for the three and nine months ended September 30, 2025 and 2024 (dollars in millions):

Current wording

The following table summarizes our results of operations for our Advisory Services operating segment for the three months ended March 31, 2026 and 2025 (dollars in millions):

Previous wording

Revenue increased 16.8% during the quarter compared to the same period in 2024. Property sales revenue grew 29.5%, led by office, industrial, land and data centers in the U.S., APAC and Europe. Globally, sales grew double-digits across office, industrial and multifamily. Global leasing revenue rose 17.6%, led by data centers, office and industrial leasing driven by Americas which grew 19.1%, including 17.9% in the United States and APAC which grew 21.6%.

Current wording

Revenue increased 22.0% during the quarter compared to the same period in 2025. Property sales revenue grew 42.5%, led by industrial, retail, multifamily, office, and data centers in the U.S. and Asia Pacific. Globally, sales grew double-digits across industrial, office, and multifamily. Global leasing revenue rose 20.1%, led by data centers, industrial and office leasing driven by growth in the Americas which grew 20.5%, including 20.7% in the United States, and growth in Asia Pacific which grew 24.4%.

Previous wording

Cost of revenue, excluding pass-through costs increased 17.5%, primarily reflecting business growth and higher commission expense. Foreign currency translation had a 0.9% negative impact on total cost of revenue, excluding pass-through costs. Cost of revenue, excluding pass-through costs as a percentage of total revenue increased slightly to 58.1% compared to the same period in 2024, as costs of revenue increased proportionately with the increase in revenue.

Current wording

Cost of revenue, excluding pass-through costs increased 23.7%, primarily reflecting business growth and higher commission expense, salaries and bonus. Foreign currency translation had a 3.0% negative impact on total cost of revenue, excluding pass-through costs.

Previous wording

Operating, administrative and other expenses increased by 7.6%, as compared to the same period in 2024, primarily due to higher employee compensation and business promotion, advertising and travel expenses driven by the growth in the business. Foreign currency translation had a 1.3% negative impact on total operating expenses.

Current wording

Operating, administrative and other expenses increased by 9.6%, as compared to the same period in 2025, primarily due to higher employee compensation and business promotion and advertising expenses driven by the growth in the business. Foreign currency translation had a 4.2% negative impact on total operating expenses.

Previous 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.

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. During the first quarter of 2026, we began reclassifying amortization associated with MSRs (mortgage servicing rights) to net against the related revenue (Commercial mortgage origination). Historically, the corresponding MSR intangible assets were amortized through amortization expense over the estimated mortgage service period. Prior year amounts have been reclassified to conform to the fiscal 2026 presentation.

Previous wording

(3)In the third quarter of 2025, management made the decision to wind down certain businesses within the BOE Segment.

Current wording

(3)Management made the decision to wind down certain businesses within the BOE Segment.

Previous wording

Revenue increased 12.6%, reflecting a double-digit increase in property management and facilities management, primarily due to growth in clients driving increased management fees and reimbursements as well as the impact from acquisitions. Foreign currency translation had a 1.9% positive impact on total revenue during the quarter, primarily driven by strength in the euro and British pound sterling, partially offset by weakness in the Indian rupee.

Current wording

Revenue increased 20.4%, reflecting double-digit increases in facilities management, critical infrastructure and property management, primarily due to growth in clients driving increased management fees and reimbursements as well as the impact from recent acquisitions. Foreign currency translation had a 4.4% positive impact on total revenue during the quarter, primarily driven by strength in the euro and British pound sterling, partially offset by weakness in the Indian rupee.

Previous wording

Cost of revenue, excluding pass-through costs increased 15.8%, driven primarily by higher professional compensation and indirect managed spend, due to revenue growth, as well as an increase driven by acquisitions. Foreign currency translation had a 1.8% negative impact on total cost of revenue, excluding pass-through costs. Cost of revenue, excluding pass-through costs was 36.6% of total revenue, and increased compared to 35.6% in the third quarter 2024.

Current wording

Cost of revenue, excluding pass-through costs increased 23.4%, driven primarily by higher professional compensation and indirect managed spend due to revenue growth. Foreign currency translation had a 4.1% negative impact on total cost of revenue, excluding pass-through costs. Cost of revenue, excluding pass-through costs was 36.5% of total revenue, and increased compared to 35.6% in the first quarter 2025.

Previous wording

Operating, administrative and other expenses increased 23.4%, primarily due to higher employee compensation and benefit expenses and an increase in bad debt expense. Foreign currency translation had a 2.1% negative impact on total operating expenses during the quarter.

Current wording

Operating, administrative and other expenses increased 25.7%, primarily due to higher employee compensation and benefit expenses. Foreign currency translation had a 4.7% negative impact on total operating expenses during the quarter.

Previous wording

The following table summarizes our results of operations for our Project Management operating segment for the three and nine months ended September 30, 2025 and 2024 (dollars in millions):

Current wording

The following table summarizes our results of operations for our Project Management operating segment for the three months ended March 31, 2026 and 2025 (dollars in millions):

Previous wording

Revenue increased 20.4% due to strong business activity in the United Kingdom, the Middle East and North America and increased revenue from pass-through costs. Foreign currency translation had a 1.9% positive impact on total revenue during the quarter, primarily driven by strength in the British pound sterling and euro.

Current wording

Revenue increased 15.3% due to strong business activity in the United Kingdom and Asia and increased revenue from pass-through costs. Foreign currency translation had a 4.3% positive impact on total revenue during the quarter, primarily driven by strength in the British pound sterling and euro partially offset by weakness in Indian rupee.

Previous wording

Pass-through costs increased 24.1% during the quarter as compared to the same period in 2024 primarily due to revenue growth in the Project Management segment. Foreign currency translation had a 1.5% negative impact on pass-through costs.

Current wording

Pass-through costs increased 12.1% during the quarter as compared to the same period in 2025 primarily due to revenue growth in the Project Management segment. Foreign currency translation had a 3.0% negative impact on pass-through costs.

Previous wording

Cost of revenue, excluding pass-through costs increased 10.8%, driven by increased professional compensation. Foreign currency translation had a 0.6% negative impact on total cost of revenue, excluding pass-through costs. Cost of revenue, excluding pass-through costs was 33.0% of total revenue, a slight decrease from 34.0% for the nine months ended September 30, 2024.

Current wording

Cost of revenue, excluding pass-through costs increased 19.0%, driven by increased professional compensation and third party spend due to revenue growth. Foreign currency translation had a 5.7% negative impact on total cost of revenue, excluding pass-through costs. Cost of revenue, excluding pass-through costs was 35.4% of total revenue, and increased from 34.3% in the first quarter 2025.

Previous wording

Revenue decreased 30.1% for the current quarter primarily due to lower incentive fees in our Investment Management business and lower construction management and development fees from development services. Foreign currency translation had a 2.0% positive impact on total revenue during the quarter primarily driven by strength in the British pound sterling and euro.

Current wording

Revenue decreased 14.6% for the current quarter primarily due to lower management and development fees from development services. Foreign currency translation had a 4.7% positive impact on total revenue during the quarter primarily driven by strength in the British pound sterling and euro.

Previous wording

Cost of revenue decreased 35.0% in the quarter as compared to the same period in 2024 due to lower construction costs incurred on our real estate development projects. Foreign currency translation had a 3.3% negative impact on total cost of revenue during the quarter.

Current wording

Cost of revenue decreased 44.7% in the quarter as compared to the same period in 2025 due to lower construction management costs incurred on our real estate development projects. Foreign currency translation had a 4.2% negative impact on total cost of revenue during the quarter.

Previous wording

Operating, administrative and other expenses decreased 16.2% primarily due to a decrease in total compensation in our investment management and development services lines of business. Foreign currency translation had a 1.3% negative impact on total operating expenses.

Current wording

Operating, administrative and other expenses increased 72.9% primarily due to an increase in total compensation in our development services lines of business resulting from an increase in development sales during the quarter. Foreign currency translation had a 4.8% negative impact on total operating expenses.

Previous wording

Gain on disposition of real estate increased by $34 million compared with third quarter 2024, driven by monetization of real estate development assets in the current period versus none in the prior year quarter.

Current wording

Gain on disposition of real estate increased by $281 million compared with first quarter 2025, driven by monetization of real estate development assets in the current period versus none in the prior year quarter.

Previous wording

A roll forward of our AUM by product type for the three months ended September 30, 2025 is as follows (dollars in billions):

Current wording

A roll forward of our assets under management (AUM) by product type for the three months ended March 31, 2026 is as follows (dollars in billions):

Previous wording

Our Corporate segment primarily consists of corporate overhead costs. Other consists of activities from strategic non-core non-controlling equity investments and is considered an operating segment but does not meet the aggregation criteria for presentation as a separate reportable segment and is, therefore, combined with our core Corporate function and reported as Corporate and other. The following table summarizes our results of operations for our core Corporate and other segment for the three and nine months ended September 30, 2025 and 2024 (dollars in millions):

Current wording

Our Corporate segment primarily consists of corporate overhead costs. Other consists of activities from strategic non-core non-controlling equity investments and is considered an operating segment but does not meet the aggregation criteria for presentation as a separate reportable segment and is, therefore, combined with our core Corporate function and reported as Corporate and other. The following table summarizes our results of operations for our core Corporate and other segment for the three months ended March 31, 2026 and 2025 (dollars in millions):

Previous wording

Operating, administrative and other expenses for our core corporate functions rose 13.0% to $183 million for the third quarter of 2025, mainly due to higher costs related to acquisitions, integration activities and higher management incentive compensation.

Current wording

Operating, administrative and other expenses for our core corporate functions rose 9.3% to $200 million for the first quarter of 2026, mainly due to higher management incentive compensation related to our strong performance.

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 and commercial paper program. Our expected capital requirements for 2025 include up to $339 million of anticipated capital expenditures, net of tenant concessions. During the nine months ended September 30, 2025, we incurred $222 million of capital expenditures. As of September 30, 2025, we had aggregate future commitments of $187 million related to co-investments funds in our REI segment, $22 million of which is expected to be funded in 2025. Additionally, as of September 30, 2025, we are committed to fund additional capital of $357 million and $62 million to consolidated and unconsolidated projects, respectively, within our REI segment. As of September 30, 2025, we had $3.5 billion of borrowings available under our revolving credit facilities (under both the 5-Year Revolving Credit Agreement and 364-Day Revolving Credit Agreement, as described below, and the Turner & Townsend revolving credit facility) and $1.7 billion of cash and cash equivalents. We intend to maintain available commitments under the 5-Year Revolving Credit Agreement in an amount at least equal to the amount of commercial paper notes outstanding from time to time. As of September 30, 2025 and December 31, 2024, we had $1.1 billion and $175 million, respectively, in outstanding borrowings under the commercial paper program.

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 2026 include up to $500 million of anticipated capital expenditures, net of tenant concessions. During the three months ended March 31, 2026, we incurred $81 million of capital expenditures. As of March 31, 2026, we had aggregate future commitments of $214 million related to co-investments funds in our REI segment, approximately $100 million of which is expected to be funded in 2026. Additionally, as of March 31, 2026, we are committed to fund additional capital of $159 million and $66 million to consolidated and unconsolidated projects, respectively, within our REI segment. As of March 31, 2026, we had $2.7 billion of borrowings available under our revolving credit facilities (under both the 5-Year Revolving Credit Agreement and 364-Day Revolving Credit Agreement, as described below, and the Turner & Townsend revolving credit facility) and $1.7 billion of cash and cash equivalents. At any point in time, we intend to maintain available commitments under the 5-Year Revolving Credit Agreement in an amount at least equal to the amount of commercial paper notes outstanding. As of March 31, 2026 and December 31, 2025, we had $1.9 billion and $852 million, respectively, in outstanding borrowings under the commercial paper program.

Previous wording

We have historically relied on our internally generated cash flow, our revolving credit facilities and commercial paper program to fund our working capital, capital expenditure and general investment requirements (including in-fill acquisitions) and have not sought other external sources of financing to help fund these requirements. In the absence of extraordinary events, large strategic acquisitions or large returns of capital to shareholders, we anticipate that our cash flow from operations, our revolving credit facilities and commercial paper program would be sufficient to meet our anticipated cash requirements for the foreseeable future, and at a minimum for the next 12 months. Given compensation is our largest expense and our sales and leasing professionals are generally paid on a commission and/or bonus basis that correlates with their revenue production, the negative effect of difficult market conditions is partially mitigated by the inherent variability of our compensation cost structure. We may seek to take advantage of market opportunities to refinance existing debt instruments, as we have done in the past, with new debt instruments at interest rates, maturities and terms we deem attractive. We may also, from time to time in our sole discretion, purchase, redeem, or retire our existing senior notes, through tender offers, in privately negotiated or open market transactions, or otherwise.

Current wording

We have historically relied on our internally generated cash flow, our revolving credit facilities and commercial paper program to fund our working capital, capital expenditure and general investment requirements (including in-fill acquisitions) and have not sought other external sources of financing to help fund these requirements. In the absence of extraordinary events, large strategic acquisitions or large returns of capital to shareholders, we anticipate that our cash flow from operations, our revolving credit facilities and commercial paper program will be sufficient to meet our anticipated cash requirements for the foreseeable future, and at a minimum for the next 12 months. Given compensation is our largest expense and our sales and leasing professionals are generally paid on a commission and/or bonus basis that correlates with their revenue production, the negative effect of difficult market conditions is partially mitigated by the inherent variability of our compensation cost structure. We may seek to take advantage of market opportunities to refinance existing debt instruments, as we have done in the past, with new debt instruments at interest rates, maturities and terms we deem attractive. We may also, from time to time in our sole discretion, purchase, redeem, or retire our existing senior notes, through tender offers, in privately negotiated or open market transactions, or otherwise.

Previous wording

On May 12, 2025, we issued $600 million in aggregate principal amount of 4.800% senior notes due in 2030 and $500 million in aggregate principal amount of 5.500% senior notes due in 2035, generating aggregate net proceeds of approximately $1.1 billion after offering expenses. On May 28, 2025, we used a portion of the proceeds from this offering to redeem in full the $600 million aggregate outstanding principal amount of our 4.875% senior notes due 2026.

Current wording

On May 12, 2025, we issued $600 million in aggregate principal amount of 4.800% senior notes due 2030 and $500 million in aggregate principal amount of 5.500% senior notes due 2035, generating aggregate net proceeds of approximately $1.1 billion after offering expenses. On May 28, 2025, we used a portion of the proceeds from this offering to redeem in full the $600 million aggregate outstanding principal amount of our 4.875% senior notes due 2026.

Previous wording

Our long-term liquidity needs, other than those related to ordinary course obligations and commitments such as operating leases, are generally comprised of the following elements. The first is the repayment of the outstanding and anticipated principal amounts of our long-term indebtedness. If our cash flow is insufficient to repay our long-term debt when it comes due, then we expect that we would need to refinance such indebtedness or otherwise amend its terms to extend the maturity dates. We cannot make any assurances that such refinancing or amendments would be available on attractive terms, if at all.

Current wording

Our long-term liquidity needs, other than those related to ordinary course obligations and commitments such as operating leases, generally consist of the following: the first is the repayment of the outstanding and anticipated principal amounts of our long-term indebtedness. If our cash flow is insufficient to repay our long-term debt when it comes due, then we expect that we would need to refinance such indebtedness or otherwise amend its terms to extend the maturity dates. We cannot make any assurances that such refinancing or amendments would be available on attractive terms, if at all.

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 September 30, 2025 and December 31, 2024, we had accrued deferred purchase consideration totaling $339 million ($234 million of which was a current liability) and $292 million ($199 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 1 of this Quarterly Report.

Current 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 March 31, 2026 and December 31, 2025, we had accrued deferred purchase consideration totaling $278 million ($151 million of which was a current liability) and $279 million ($149 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 1 of this Quarterly Report.