CBRE Group, Inc. Announces Plans to Combine Project Management Business with its Turner & Townsend Subsidiary
Upon closing the transaction, CBRE will own
CBRE’s entire Project Management business, including Turner & Townsend, produced net revenue of approximately
Bob Sulentic, CBRE’s chair and chief executive officer, said: “Unifying our Project Management business will create an offering that is unmatched for its scale and breadth of capabilities, with more than 20,000 employees serving clients in over 60 countries. Powerful secular trends, particularly increased spending on infrastructure, green energy, and employee experience, are growth catalysts for this business and we are well positioned to capitalize on this significant opportunity.”
The combined business will be led by Vincent Clancy, Turner & Townsend’s chief executive officer, who will continue to report to a Board controlled by CBRE and comprised of senior executives from both CBRE and Turner & Townsend.
“Vince is an exemplary leader who has guided Turner & Townsend to great success,” Mr. Sulentic said. “Putting CBRE’s extensive global Project Management resources and capabilities under Vince will strengthen our value proposition for clients and advance our growth ambitions.”
Mr. Clancy said: “Our ambition since joining forces with CBRE in 2021 has been to create the premier, differentiated program, project and cost management capability globally. We have made exceptional progress towards this goal and our revenue and profit have grown significantly in the last three years. Turner & Townsend’s momentum will continue to grow with the combining of two great businesses into one integrated, pure play project management capability. Our combined depth of talent and resources, global footprint, sector expertise and commitment to excellence will be second to none in project and program management.”
The CBRE Board of Directors intends to appoint Mr. Clancy to the CBRE Board upon closing the transaction. “Vince will bring a global perspective and deep experience in key growth areas like renewable energy and infrastructure to our Board. We look forward to his insights and contributions,” Mr. Sulentic said.
Beginning in 2025, CBRE intends to report Project Management results in a new segment separate from Global Workplace Solutions in order to provide increased transparency for investors.
Turner & Townsend operates across three business segments globally, Real Estate – serving investors and occupiers across all property types, including data centers and life sciences; Infrastructure – notably transport and aviation; and Energy and Natural Resources – including renewable energy, alternative fuels and liquified natural gas.
The transaction is expected to close around year-end, subject to satisfaction of regulatory and other customary conditions and completion of required consultations with employee Works Councils in certain jurisdictions.
About CBRE Group, Inc.
CBRE Group, Inc. (NYSE:CBRE), a Fortune 500 and S&P 500 company headquartered in
About Turner & Townsend
Turner & Townsend is a global professional services company with over 10,000 people in 48 countries. Collaborating with our clients across real estate, infrastructure and natural resources sectors, the company specializes in major programs, program management, cost and commercial management, net zero and digital solutions. Turner & Townsend is majority-owned by CBRE Group, Inc., the world’s largest commercial real estate services and investment firm, with its partners holding a significant non-controlling interest. www.turnerandtownsend.com
Forward-Looking Statements
Certain of the statements in this release regarding the combining of CBRE’s Project Management business with Turner & Townsend and the performance of the combined business that do not concern purely historical data are forward-looking statements within the meaning of the “safe harbor” provisions of the
(1) | Reconciliation of Project Management revenue to net revenue is shown below (dollars in millions): |
Years ending December 31, |
|||||||||
Project Management Revenue | 2023 |
|
2022 |
|
2021 |
||||
Revenue | $ |
7,310 |
$ |
4,650 |
$ |
2,932 |
|||
Less: Pass through costs also recognized as revenue |
|
4,186 |
|
1,915 |
|
1,395 |
|||
Net revenue | $ |
3,124 |
$ |
2,735 |
$ |
1,537 |
|||
Fiscal 2021 includes two months of activity for Turner & Townsend since the acquisition closed on November 1, 2021. |
(2) |
Represents management’s best estimate of Project Management line of business’ contribution to overall Global Workplace Solutions operating profit on a net revenue basis. |
|
|
(3) |
CBRE has not reconciled the (non-GAAP) Core EPS forward-looking guidance included in this release to the most directly comparable GAAP measure because this cannot be done without unreasonable effort due to the variability and low visibility with respect to potential adjustments to future earnings, such as acquisition related charges. |
View source version on businesswire.com: https://www.businesswire.com/news/home/20240624021635/en/
Chandni Luthra - Investors
212.984.8113
Chandni.Luthra@cbre.com
Steve Iaco – Media
212.984.6535
Steven.Iaco@cbre.com
Source: CBRE Group, Inc.