CBRE’s revenue dipped only slightly by 0.3% to $23.8bn (£16.9bn) during 2020, with its global workspace solutions and real estate investment segments offsetting the pandemic’s impact on the advisory business.
Fee revenues slipped by 8.2% to $11.9bn in the year ending 31 December, while adjusted EBITDA fell 8.3% to nearly $2.1bn.
Bob Sulentic, president and chief executive at CBRE, said the firm ended 2020 on a “high note”, with adjusted earnings per share for its final quarter reaching an all-time high and Q4 EBITDA growing by 9%.
He added that the business is “exiting the worst of the Covid-19 crisis in great shape, with a leaner operating structure, significant financial capacity and a strategy squarely aimed at the many opportunities unfolding in our industry, including those with secular tailwinds”.
Additionally, the firm’s long-term plan has been built with the “assumption that office demand remains under pressure”.
Sulentic said he expects a minimum of low growth in double-digit average annual adjusted earnings per share until “at least 2025”, barring a recession, with “meaningful upside potential” from additional capital allocation.
The advisory business saw Q4 revenues slide by 12.6% to $2.4bn, with sales and leasing activity hit by the pandemic.
Although the UK business posted a 6% decline in overall leasing revenue during Q4, this was offset by “robust” growth in industrial leasing.
The firm’s commercial mortgage origination business was the standout performer as government agency lending surged. Commercial mortgage revenue rose 49% year-on-year on a local currency basis.
Revenues from loan servicing jumped by a quarter during the three-month period. The loan servicing portfolio ended 2020 at approximately $269bn, up 17%.
Valuation also performed solidly with revenue up 4%, after increased assignments from investor clients, particularly in Continental Europe, North Asia and Pacific markets.
The global workspace solutions segment posted 2.5% growth in Q4 to nearly $4.2bn, driven by gains in continental Europe and north Asia, as well as cost-saving measures.
The real estate investments segment recorded a 17.2% leap to $289m in Q4, which the firm said was boosted by its investment management and US development activity.
Telford Homes, its UK multi-family development business, generated $9.2m of adjusted EBITDA, 15.6% down on its equivalent in Q4 2019.
CBRE’s flexible working arm Hana, which will soon merge with New York-based company Industrious, made a $10.4m loss, deepening from an equivalent loss of $8.4m in Q4 2019.
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