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CBRE Group — CBRE March 2023 Investor Overview (company IR deck)
CBRE Group (CBRE) · 0 slides · Filed Oct 22, 2026
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Slide 1 — CBRE
CBRE Investor Overview March 2023
Slide 2 — Forward-Looking
2023 CBRE, Inc. | 2 This presentation contains statements that are forward looking within the meaning of the Private Securities Litigation Reform Act of 1995. These statements involve risks and uncertainties that may cause actual results and trends to differ materially from those projected. Except to the extent required by applicable securities laws, we undertake no obligation to update or publicly revise any of the forward-looking statements that you may hear today. Please refer to our fourth quarter earnings release, furnished on Form 8-K, our most recent annual report filed on Form 10-K, and in particular any discussion of risk factors or forward-looking statements therein, which are available on the SEC’s website (www.sec.gov), for a full discussion of the risks and other factors that may impact any forward-looking statements that you may hear today. We may make certain statements during the course of this presentation, which include references to “non-GAAP financial measures,” as defined by SEC regulations. Where required by these regulations, we have provided reconciliations of these measures to what we believe are the most directly comparable GAAP measures, which are included in the appendix. INVESTOR OVERVIEW Forward-Looking Statements
Slide 3 — ~500
2023 CBRE, Inc. | 3 CBRE 54% Peers 46% CBRE is the Global Leader in a Growing Industry C R E S E RV I C E S M A R K E T C A P A S O F D E C E M B E R 3 1 , 2 0 2 2 M A R K E T L E A D E R S H I P • #1 Leasing • #1 Property Sales • #1 Outsourcing • #1 Appraisal & Valuation • #1 Property Management • #1 US Commercial Developer • $149.3 billion AUM as of 12/31/22 • $16.9 billion In-Process Development Portfolio as of 12/31/22 INVESTOR OVERVIEW L E A D I N G G L O B A L B R A N D • Lipsey’s #1 Corporate Real Estate Brand for 22 consecutive years • FORTUNE’s Most Admired Real Estate Company 4 of the past 5 years • One of the World’s Most Ethical Companies awarded by the Ethisphere Institute for 9 straight years • #4 on Barron’s 100 Most Sustainable Companies ~500 Offices Globally +100 Countries Where Clients are Served $30.8B 2022 Revenue 117 Years Continuous operations (1) Definitions, endnotes and reconciliations are provided at the end of the presentation
Slide 4 — Serving Global Clients Through Three Business Segments
2023 CBRE, Inc. | 4 Serving Global Clients Through Three Business Segments Full-year 2022, Segment Operating Profit | $ in millions Advisory $1,910 GWS $899 REI $518 11.0% net margin 47.6% net margin 21.7% net margin; 1.6% ex-OMSR gains INVESTOR OVERVIEW CBRE works in every dimension of commercial real estate and is the global leader in our industry. We engage with our global clients through three business segments: Advisory Services: Provide leasing, capital markets, loan servicing, property management and valuation services to both real estate investors and occupiers. Global Workplace Solutions: Providing occupiers of real estate a fully integrated set of services focused on facilities management and project management services. Real Estate Investments: Serving investors in real estate through a $149B AUM investment management business and a development business with around $17B of projects currently under development as of December 31, 2022. Definitions, endnotes and reconciliations are provided at the end of the presentation
Slide 5 — CBRE Drivers of Long-Term Growth
2023 CBRE, Inc. | 5 INVESTOR OVERVIEW CBRE Drivers of Long-Term Growth Tailwinds for CRE Services Sector • Increasing institutional ownership of CRE driving demand for institutional quality CRE services • Occupier demand for CRE outsourcing services remains robust • Clients coalescing around market leaders, with CBRE being the most significant beneficiary Market-Leading Competitive Position • CBRE has market-leading service offerings across business lines and geographies • Differentiated platform enables CBRE to attract and retain the industry’s top talent • Significant value creation from maximizing cross selling across the platform • Share of revenue generated from large clients has increased in-line with CBRE’s capabilities Investment Capacity • Low capital intensity + ample investment capacity • TTM Q4 2022 leverage of 0.1x remains well below mid-point target of 1.0x • CBRE repurchased roughly $1.9B of shares in 2022 Highly Resilient Business • Business mix is increasingly comprised of highly resilient business lines • Transactional businesses rebound quickly out of a downturn • Cost structure is highly variable; management experienced in reducing non-variable costs
Slide 6 — Structural Tailwinds for Commercial Real Estate Services Sector
2023 CBRE, Inc. | 6 18.0% 23.7% 2007 2021 INVESTOR OVERVIEW Structural Tailwinds for Commercial Real Estate Services Sector Shift to Outsourcing Institutional Real Estate Ownership Rising Industry Leaders Taking Market Share E s t i m a t e d I n t e g r a t e d F a c i l i t i e s M g t . M k t . S i z e ( 2 ) In-house and outsourced spend ($ Billions) % I n s t i t u t i o n a l A s s e t A l l o c a t i o n t o R e a l E s t a t e ( 3 ) C B R E G l o b a l P r o p e r t y S a l e s S h a r e ( 4 ) $135 ~$200 2018 2024E 8.9% 10.8% 11.1% 2013 2022 2023E +6.5% CAGR +2.2% +5.7% Definitions, endnotes and reconciliations are provided at the end of the presentation
Slide 7 — Client Size and Diversity Have Increased with CBRE’s Capabilities
2023 CBRE, Inc. | 7 Industry Diversity of Top 50 Clients has Improved Over Time Large Clients Now Represent Larger Share of Total Revenue INVESTOR OVERVIEW Client Size and Diversity Have Increased with CBRE’s Capabilities 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 2012 2022 Top 50 51 - 100 0% 5% 10% 15% 20% 25% 30% 35% 40% Financials Consumer Health Care IT/Telecom Energy/Industrial/Materials Government Real Estate 2022 2012
Slide 8 — Geographic Breadth Allows CBRE to Better Serve Large Global Clients
2023 CBRE, Inc. | 8 Americas APAC EMEA Client 1 ●●● ●●● ●●● Client 2 ●●● Client 3 ●●● ●● ● Client 4 ●●● ●●● ●●● Client 5 ●●● ●●● ●●● Client 6 ●●● ●●● ●●● Client 7 ●●● ●●● ●●● Client 8 ●●● ● ●●● Client 9 ●●● ●●● ●●● Client 10 ●●● ● ●●● INVESTOR OVERVIEW Geographic Breadth Allows CBRE to Better Serve Large Global Clients 60 >100 2010 2022 +1.7x • Global clients want a global solution • Companies need to offer globally diversified CRE services “under one roof” • More services in more locations gives CBRE more “shots on goal” ●- 2022 Revenue between $1M and $5M ●●- 2022 Revenue between $5M and $10M ●●●- 2022 Revenue greater than $10M CBRE’s 10 Largest Clients Generate Substantial Revenue from Multiple Regions # of Countries in which CBRE serves clients
Slide 9 — Market-Leading Scale Enables Significant Cross-Selling
2023 CBRE, Inc. | 9 Market-Leading Scale Enables Significant Cross-Selling 2022 Services Revenue Characteristics Among Our 10 Largest Clients(5) INVESTOR OVERVIEW ~80% of top 100 clients purchased 4 or more services in 2022, up from <25% a decade ago Client Rank Client Industry Leasing Capital Markets Facilities Mgmt. Project Mgmt. Other Client 1 Financials ●●● ●● ●●● ●●● ● Client 2 Logistics ●●● Client 3 Financials ●● ●●● ●●● ●●● ●●● Client 4 Tech ● ●●● ●●● Client 5 Tech ●●● ●●● ●●● Client 6 Life Sciences ●●● ● ●●● ●●● Client 7 Tech ●●● ●●● ●●● Client 8 Life Sciences ●● ●●● ●●● Client 9 Energy ●● ●●● ●●● Client 10 Life Sciences ●●● ●●● ●●● ●- Revenue between $1M and $5M ●●- Revenue between $5M and $10M ●●●- Revenue greater than $10M Definitions, endnotes and reconciliations are provided at the end of the presentation
Slide 10 — Development Business is a Differentiated Driver of CBRE’s Growth
2023 CBRE, Inc. | 10 Industrial $6.4 Office $1.8 Multifamily $5.2 Healthcare $1.0 Life Sciences $2.4 Other $0.2 In-Process Portfolio Composition $ Billions | As of 12/31/22 INVESTOR OVERVIEW Development Business is a Differentiated Driver of CBRE’s Growth $5.4 $6.7 $6.6 $6.8 $9.0 $13.0 $14.9 $18.5 $16.9 2014 2015 2016 2017 2018 2019 2020 2021 2022 In-Process Portfolio (6) $ Billions $72 $90 $114 $120 $187 $121 $153 $351 $333 2014 2015 2016 2017 2018 2019 2020 2021 2022 Development Line of Business Operating Profit (7) $ Millions % of Avg. In-Process Portfolio 1.4% 1.4% 1.7% 1.8% 2.1% 1.1% 1.1% 2.1% • Portfolio well positioned for current environment • More than 80% of in-process portfolio related to industrial, multifamily or life sciences • Expect 1% to 2% of in-process portfolio to convert to SOP over a 12-month period in most economic environments 15% CAGR 21% CAGR Definitions, endnotes and reconciliations are provided at the end of the presentation 1.8%
Slide 11 — Capital Allocation
2023 CBRE, Inc. | 11 INVESTOR OVERVIEW Definitions, endnotes and reconciliations are provided at the end of the presentation Capital Allocation ⎻Expect CBRE to invest more aggressively utilizing free cash flow and balance sheet during periods of market weakness ⎻Repurchased ~23M shares in 2022, representing ~$1.9 billion. Since 2019, we repurchased 31M shares for a total consideration of ~$2.4B ⎻Our weighted average share count has decreased ~5% over since the end of 2018 ⎻Maintain increasingly robust pipeline of M&A opportunities Historical Capital Allocation, $ billions Capital Allocation 2019 – Present ■ Share Repurchases $2.4 ■ Strategic M&A $1.5 ■ Infill M&A $0.5 ■ CapEx $1.0 ■ Strategic Investments (8) $0.8 Total $6.2 0.7x 0.7x 0.6x 0.4x 0.6x 0.5x 0.2x (0.3)x 0.0x (0.1)x(0.3)x(0.3)x 0.0x 0.2x 0.2x 0.1x (0.5x) 0.0x 0.5x 1.0x 1.5x 2.0x Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2019 2020 2021 2022 Net Leverage Middle of Target Range High-End of Target Range Capital Allocation
Slide 12 — CBRE’s Business Mix is Increasingly Resilient to Economic Cycles
2023 CBRE, Inc. | 12 INVESTOR OVERVIEW Leasing, $3,872 Property Sales, $2,523 Originations, $563 Facilities Management, $5,137 Project Management, $2,735 Loan Servicing, $311 Property Management, $1,777 Valuation, $764 Development, $515 Carried Int. and Incent. Fees, $58 Asset Mgmt. Fees, $536 Transactional Resilient Advisory GWS CBRE’s Business Mix is Increasingly Resilient to Economic Cycles 45% 32% 2022 2011 Trailing Twelve-Month Net Revenue Contributions as of 2022 (9) $ Millions Portion of Segment Operating Profit from Highly Resilient Business Lines (10) Definitions, endnotes and reconciliations are provided at the end of the presentation REI
Slide 13 — CBRE’s Property Exposure is Increasingly Diversified (11)
2023 CBRE, Inc. | 13 Office Retail Industrial Multi-Housing Other 2012 2022 2012 2022 2012 2022 2012 2022 2012 2022 U.S. Leasing 72% 59% 10% 8% 16% 29% n/a n/a 2% 3% U.S. Sales 33% 16% 13% 11% 16% 27% 30% 30% 8% 17% Development 43% 22% 3% 1% 15% 29% 11% 26% 27% 22% Investment Management 24% 19% 35% 11% 12% 30% 12% 17% 16% 23% INVESTOR OVERVIEW CBRE’s Property Exposure is Increasingly Diversified (11) Note: Other predominantly consists of mixed use, healthcare, life sciences, land and infrastructure
Slide 14 — Advisory Segment Lines of Business Resilient Through the Cycle
2023 CBRE, Inc. | 14 (40.0%) (20.0%) 0.0% 20.0% 40.0% 60.0% 80.0% 100.0% Property Management Valuation Loan Servicing Advisory Leasing Advisory Sales Commerical Mortgage Origination S&P 500 Trailing-Twelve Month Revenue Growth TTM 1Q'21 TTM 1Q'22 Advisory Segment Lines of Business Resilient Through the Cycle ⎻Advisory Lines of Business with most short-term cyclicality exhibit strongest recovery ⎻Total revenue growth, inclusive of COVID downturn, exceeded S&P 500 in five of six Lines of Business within Advisory Segment ⎻Total Advisory segment revenue growth outperformed broader market from Q1 2020 to Q1 2022 INVESTOR OVERVIEW (12) Definitions, endnotes and reconciliations are provided at the end of the presentation
Slide 15 — CBRE vs. S&P 500 – Earnings per Share Growth is over 3x the S&P 500
2023 CBRE, Inc. | 15 INVESTOR OVERVIEW Definitions, endnotes and reconciliations are provided at the end of the presentation CBRE vs. S&P 500 – Earnings per Share Growth is over 3x the S&P 500 TTM Core EPS (13) since 12/31/2011 0% 100% 200% 300% 400% 500% 600% 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 CBRE: +494% S&P 500: +115%
Slide 16
Slide 17 — $3.2B
2023 CBRE, Inc. | 17 Sustainability and Social Responsibility As of 12/31/21 INVESTOR OVERVIEW $3.2B $20.2M Net Zero Spent with small & diverse suppliers Charitable Giving (incl. employee donations) By 2040 commitment 11th Most Sustainable Company in the U.S., according to Barron’s $2B 3,235 75% 94% 590 5,941 Green Financing bonds / notes issued (CBRE IM) Employee wellbeing and inclusion scores Executives completed unconscious bias training Energy and sustainability experts (GWS and Advisory) ENERGY STAR registered buildings (346.9 million sq. ft) Energy efficiency and decarbonization projects, 272,000 metric tons CO2 reduced (GWS)
Slide 18 — High-Quality and Well-Aligned Corporate Governance
2023 CBRE, Inc. | 18 High-Quality and Well-Aligned Corporate Governance INVESTOR OVERVIEW 2022 NEO “At Risk” Performance-Based Compensation Board Diversity 36% Diverse 27% Women 91% Independent Race & Ethnicity Gender Independence Tenure 2 4 5 8+ Years 5-8 Years 0-4 Years 11% Base Salary 18% Annual Performance Award 41% Core EPS Equity Award 30% Time-Vested Equity Award 89% Variable 59% Tied to Financial and Strategic Performance 71% Tied to Stock Price Performance
Slide 19
Slide 20 — Non-GAAP
2023 CBRE, Inc. | 20 The following measures are considered “non-GAAP financial measures” under SEC guidelines: i. Net revenue ii. Core EBITDA iii. Business line operating profit/loss iv. Segment operating profit on revenue and net revenue margins v. Net debt vi. Core adjusted net income attributable to CBRE Group, Inc. stockholders (which we also refer to as “core adjusted net income”) vii. Core EPS These measures are not recognized measurements under United States generally accepted accounting principles (GAAP). When analyzing our operating performance, investors should use these measures in addition to, and not as an alternative for, their most directly comparable financial measure calculated and presented in accordance with GAAP. Because not all companies use identical calculations, our presentation of these measures may not be comparable to similarly titled measures of other companies. Our management generally uses these non-GAAP financial measures to evaluate operating performance and for other discretionary purposes. The company believes these measures provide a more complete understanding of ongoing operations, enhance comparability of current results to prior periods and may be useful for investors to analyze our financial performance because they eliminate the impact of selected charges that may obscure trends in the underlying performance of our business. The company further uses certain of these measures, and believes that they are useful to investors, for purposes described below. With respect to net revenue, net revenue is gross revenue less costs largely associated with subcontracted vendor work performed for clients. We believe that investors may find this measure useful to analyze the company’s overall financial performance because it excludes costs reimbursable by clients that generally have no margin, and as such provides greater visibility into the underlying performance of our business. With respect to Core EBITDA, business line operating profit, and segment operating profit on revenue and net revenue margins, the company believes that investors may find these measures useful in evaluating our operating performance compared to that of other companies in our industry because their calculations generally eliminate the accounting effects of acquisitions, which would include impairment charges of goodwill and intangibles created from acquisitions, the effects of financings and income tax and the accounting effects of capital spending. All of these measures may vary for different companies for reasons unrelated to overall operating performance. In the case of Core EBITDA, this measure is not intended to be a measure of free cash flow for our management’s discretionary use because it does not consider cash requirements such as tax and debt service payments. The Core EBITDA measure calculated herein may also differ from the amounts calculated under similarly titled definitions in our credit facilities and debt instruments, which amounts are further adjusted to reflect certain other cash and non-cash charges and are used by us to determine compliance with financial covenants therein and our ability to engage in certain activities, such as incurring additional debt. The company also uses segment operating profit and core EPS as significant components when measuring our operating performance under our employee incentive compensation programs. With respect to core EBITDA, core EPS and core adjusted net income, the company believes that investors may find these measures useful to analyze the underlying performance of operations without the impact of strategic non-core equity investments (Altus Power, Inc. and VC investments) that are not directly related to our business segments. These can be volatile and are often non-cash in nature. With respect to net debt, the company believes that investors use this measure when calculating the company’s net leverage ratio. INVESTOR OVERVIEW Non-GAAP Financial Measures
Slide 21 — Definitions
2023 CBRE, Inc. | 21 Core EBITDA: Core EBITDA represents earnings, inclusive of non-controlling interest, before net interest expense, write-off of financing costs on extinguished debt, income taxes, depreciation and amortization, asset impairments, adjustments related to certain carried interest incentive compensation expense (reversal) to align with the timing of associated revenue, fair value adjustments to real estate assets acquired in the Telford acquisition (purchase accounting) that were sold in the period, costs incurred related to legal entity restructuring, and integration and other costs related to acquisitions. It also removes the fair value changes, on a pre-tax basis, of certain strategic non-core non-controlling equity investments that are not directly related to our business segments (including venture capital “VC” related investments). Core adjusted Earnings Per Diluted Share: adjusted earnings per diluted share less the fair value changes and related tax impact of certain strategic non- core non-controlling equity investments that are not directly related to our business segments (including venture capital “VC” related investments). Core adjusted Net Income: net income attributable to CBRE as adjusted less the fair value changes and related tax impact of certain strategic non-core non-controlling equity investments that are not directly related to our business segments (including venture capital “VC” related investments). Liquidity: includes cash available for company use, as well as availability under the Company’s revolving credit facilities. Net Debt (net cash): calculated as cash and cash equivalents less total debt (excluding non-recourse debt). Net Revenue: gross revenue less costs largely associated with subcontracted vendor work performed for clients. These costs are reimbursable by clients and generally have no margin. Segment operating profit: Segment operating profit is the measure reported to the chief operating decision maker (CODM) for purposes of making decisions about allocating resources to each segment and assessing performance of each segment. Segment operating profit represents earnings before net interest expense, write-off of financing costs on extinguished debt, income taxes, depreciation and amortization and asset impairments, as well as adjustments related to the following: certain carried interest incentive compensation expense (reversal) to align with the timing of associated revenue, fair value adjustments to real estate acquired in the Telford Acquisition (purchase accounting) that were sold in the period, costs incurred related to legal entity restructuring, costs associated with workforce optimization, transformation initiatives and integration and other costs related to acquisitions. Prior period results have been recast to conform to this definition. Segment operating profit revenue margin: represents segment operating profit divided by net revenue. Segment operating profit revenue net margin: represents segment operating profit divided by net revenue. Business line operating profit: contribution from each line of business to the respective reportable segment’s operating profit. INVESTOR OVERVIEW Definitions
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Slide 23 — End Notes
2023 CBRE, Inc. | 23 1) Peers include JLL, Cushman & Wakefield, Colliers, Newmark, Walker & Dunlop, Marcus & Millichap and Savills 2) Source: McKinsey’s “Six Emerging Trends in Facilities Management Sourcing,” Frost & Sullivan’s “Future of Facility Management” reports and CBRE research 3) Source: Hodes Weill & Associates. Figures represent target allocations 4) Source: Real Capital Analytics (RCA) 5) Total revenue from services business lines within Advisory and GWS segments 6) In-Process figures include Long-Term Operating Assets (LTOA). LTOA are projects that have achieved a stabilized level of occupancy or have been held 18-24 months following shell completion or acquisition 7) Reflects adjusted EBITDA contribution prior to 2019. Reflects segment operating profit 2019 forward. Adjusted EBITDA includes a small amount of corporate overhead now reflected in our corporate segment 8) Includes investments in Altus Power, Industrious and VTS 9) Excludes $16 million of revenue primarily associated with intercompany eliminations within our Corporate segment 10) This chart represents our best estimates and is for illustrative purposes only to show the resiliency of CBRE’s various lines-of-business 11) U.S. Sales and Leasing figures represent total consideration, in $ billions. Development reflects total development portfolio assets, including pipeline and in-process, in $ billions. Investment Management shows Assets under Management in $ billions 12) Source: FactSet 13) Source: Bloomberg, CBRE Financials. GAAP EPS for S&P 500 INVESTOR OVERVIEW End Notes
Slide 24 — Mandatory Amortization and Maturity Schedule
2023 CBRE, Inc. | 24 32 178 428 600 500 0 1,000 2,000 3,000 4,000 5,000 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 Senior Notes - 2.500% Senior Notes - 4.875% Euro Term Loan CBRE Revolver Turner & Townsend Revolver Mandatory Amortization and Maturity Schedule $ in millions, totals may not sum due to rounding | As of December 31, 2022 1. Liquidity includes cash available for company use, as well as availability under the Company’s revolving credit facilities 2. Includes outstanding capacity on 120M GBP Turner & Townsend revolver with an additional accordion option of 20M GBP. Maturity extended to 2027 during Q1 2022 3. Maturities on revolvers represent the maturity of the facility Cash Available Revolving Credit Facility (2) Maturity Schedule – No significant maturities until December 2023 (3) – Pre-payable debt allows for further flexibility – Mix of EUR and USD denominated debt that matches business exposure and acts as a natural hedge Liquidity (1) (2) – Robust liquidity at approximately $4.8 billion, enabling net leverage of around 0.1x Cash Available Revolving Credit Facility (2) (3) INVESTOR OVERVIEW 1,318 3,460 0 1,000 2,000 3,000 4,000 5,000 Liquidity Available Revolving Credit Facilities (2) Cash
Slide 25 — Debt and Leverage
2023 CBRE, Inc. | 25 Debt and Leverage $ in millions, totals may not sum due to rounding INVESTOR OVERVIEW Cash Revolving Credit Facility Senior term loans (1) Senior notes (1) Current Portion LTD (1) Other debt (2) (3) Total Debt Less: Cash Net debt (net cash) TTM Core EBITDA Net leverage (4) Warehouse Lines of Credit (2) Non-Recourse Notes Payable on Real Estate (3) Q1 2019 $605 $336 $744 $1,016 -- 3 $2,099 $605 $1,494 $2,017 0.7x $1,561 $6 Q2 2019 536 230 750 1,016 -- 2 1,999 536 1,463 2,044 0.7x 1,350 10 Q3 2019 577 52 732 1,016 -- 6 1,806 577 1,229 2,033 0.6x 1,349 11 Q4 2019 972 -- 745 1,017 -- 6 1,768 972 796 2,070 0.4x 977 12 Q1 2020 628 -- 738 1,017 -- 7 1,761 628 1,133 2,044 0.6x 1,259 12 Q2 2020 1,214 451 746 1,017 -- 7 2,221 1,214 1,007 1,848 0.5x 754 14 Q3 2020 1,482 -- 766 1,018 -- 7 1,790 1,482 308 1,836 0.2x 1,192 29 Q4 2020 1,896 -- 786 595 -- 7 1,387 1,896 (509) 1,898 (0.3x) 1,384 80 Q1 2021 1,910 -- 766 1,082 -- 7 1,855 1,910 (55) 1,935 0.0x 675 104 Q2 2021 2,143 -- 772 1,083 -- 7 1,861 2,143 (282) 2,372 (0.1x) 1,102 129 Q3 2021 2,768 -- 761 1,083 -- 5 1,849 2,768 (919) 2,662 (0.3x) 1,384 74 Q4 2021 2,431 -- 455 1,084 -- 33 1,571 2,431 (860) 2,864 (0.3x) 1,277 48 Q1 2022 1,657 210 442 1,084 -- 31 1,767 1,657 110 3,128 0.0x 1,172 54 Q2 2022 1,193 310 419 1,085 -- 38 1,851 1,193 658 3,339 0.2x 1,018 44 Q3 2022 1,125 283 392 1,085 -- 38 1,798 1,125 673 3,212 0.2x 1,177 30 Q4 2022 1,318 178 -- 1,085 428 43 1,734 1,318 416 2,924 0.1x 448 25 1. Outstanding amounts are reflected net of unamortized debt issuance costs 2. Excludes warehouse facilities for loans originated on behalf of the FHA and other government sponsored enterprises outstanding, which are non-recourse to CBRE Group, Inc. 3. Excludes non-recourse notes payable on real estate, net of unamortized debt issuance costs 4. Net leverage is net debt (net cash) divided by TTM Core EBITDA
Slide 26 — Reconciliation of Cash Flows
2023 CBRE, Inc. | 26 INVESTOR OVERVIEW Twelve Months Ended December 31, 2022 2021 2020 2019 2018 2017 Net cash provided by operating activities $1,629 $2,364 $1,831 $1,223 $1,131 $894 Less: Capital Expenditures 260 210 267 294 228 178 Free Cash Flow $1,369 $2,154 $1,564 $930 $903 $716 Reconciliation of Cash Flows $ in millions, totals may not sum due to rounding
Slide 27 — Reconciliation of Real Estate Investments Business Line Operating Profit
2023 CBRE, Inc. | 27 INVESTOR OVERVIEW Twelve Months Ended December 31, 2022 2021 2020 2019 2018 2017 2016 2015 2014 Investment Management Operating Profit $187 $206 $142 $120 $78 $94 $83 $134 $119 Development Operating Profit 333 351 153 120 189 120 114 90 72 Other * (2) (37) (38) (31) * * * * * REI Segment Operating Profit $518 $520 $258 $210 $267 $214 $197 $224 $191 Reconciliation of Real Estate Investments Business Line Operating Profit to Segment Operating Profit $ in millions, totals may not sum due to rounding * This information is not readily available since the company has gone through segment reorganization in the recent years. REI SOP from 2014 – 2018 is our best estimate and we believe is a materially accurate representation of the segment’s operating performance for those years
Slide 28 — Reconciliation of Core EPS
2023 CBRE, Inc. | 28 INVESTOR OVERVIEW Reconciliation of Core EPS $ in millions, totals may not sum due to rounding Twelve Months Ended, December 31, 2022 2021 2020 2019 2018 2017 2016 2015 2014 2013 2012 2011 Net Income attributable to CBRE Group, Inc $1,407 $1,837 $752 $1,282 $1,063 $697 $573 $547 $485 $317 $316 $239 Add: Non-cash depreciation and amortization expense related to certain assets attributable to acquisitions 166 87 76 81 113 113 111 87 66 29 37 16 Integration and other costs related to acquisitions 41 45 2 15 9 27 126 49 - 13 39 69 Carried-interest incentive compensation (reversal) expense to align with the timing of associated revenue (4) 50 (23) 13 (5) (9) (16) 26 24 9 - -- Impact of fair value adjustments to real estate assets acquired in the Telford Acquisition (purchase accounting) that were sold in period (5) (6) 12 9 - - - - - - - - Costs incurred related to legal entity restructuring 13 - 9 7 - - - - - - - - Asset impairments 59 - 89 90 - - - - - 98 20 - Costs associated with transformation initiatives - - 155 - - - - - - - - - Costs associated with workforce optimization efforts - - 38 - - - - - - - - - Depreciation expense related to transformation initiatives - - 21 - - - - - - - - - Costs associated with our reorganization, including cost-savings initiatives - - - 50 38 - - - - - - - Write-off of financing costs on extinguished debt 2 - 76 3 28 - - 3 23 56 - - One-time gain associated with remeasuring an investment in an unconsolidated subsidiary to fair value as of the date the remaining controlling interest was acquired - - - - (100) - - - - - - - Write-down of impaired assets - - - - - - - - - - - 9 Impact of U.S. tax reform - - - - 13 143 - - - - - - Costs incurred in connection with litigation settlement - - - - 9 - - - - - - - Cost-containment expenses - - - - - - 79 40 - 18 18 31 Impact of non-core investment value changes 175 (54) 2 (3) - - - - - - - - Net gain on deconsolidation upon merger of the SPAC with and into Altus Power, net of associated costs - (156) - - - - - - - - - - Impact of adjustments on non-controlling interest (40) (4) - - - - - - - - - - Costs associated with efficiency and cost-reduction initiatives 117 - - - - - - - - - - - Provision associated with Telford’s fire safety remediation efforts 186 - - - - - - - - - - - Tax impact of adjusted items, including strategic non-core investments (254) 12 (98) (286) (44) (42) (93) (63) (36) (65) (30) (29) Core adjusted Net Income $1,863 $1,810 $1,109 $1,261 $1,124 $930 $780 $689 $561 $474 $399 $334 Weighted average shares outstanding for diluted income per share (millions) 327.7 339.7 338.4 340.5 343.1 340.8 338.4 336.4 334.2 331.8 327.0 323.7 Core EPS $5.69 $5.33 $3.27 $3.71 $3.28 $2.73 $2.30 $2.05 $1.68 $1.43 $1.22 $1.03
Slide 29 — Highly Resilient Business Lines (10)
2023 CBRE, Inc. | 29 INVESTOR OVERVIEW Highly Resilient Business Lines (10) $ in millions, totals may not sum due to rounding Segment Operating Profit 2011 % of Total 2022 % of Total Highly Resilient 300 32% 1,500 45% Transactional 645 68% 1,830 55% Total 945 3,330 Definitions, endnotes and reconciliations are provided earlier in the presentation
Slide 30 — TTM Q4’22 Revenue
2023 CBRE, Inc. | 30 Leasing Property Sales CMO Loan Servicing Valuation Property Management Facilities Management Project Management Development Investment Management Total (1) Revenue TTM Q4’22 $3,872 $2,523 $563 $311 $764 $1,850 $15,201 $4,650 $515 $595 $30,828 Less pass- through costs associated with revenue - - - - - 72 10,065 1,915 - - 12,052 Net Revenue TTM Q4’22 3,872 2,523 563 311 764 1,777 5,137 2,735 515 595 18,777 INVESTOR OVERVIEW 1. Total includes impact of Corporate eliminations of ($16) million TTM Q4’22 Revenue $ in millions, totals may not sum due to rounding
Slide 31 — Reconciliation of TTM Net Income to TTM Core EBITDA
2023 CBRE, Inc. | 31 INVESTOR OVERVIEW Twelve Months Ended, December 31, 2022 2021 2020 2019 2018 2017 2011 Net Income attributable to CBRE Group, Inc $1,407 $1,837 $752 $1,282 $1,063 $697 $239 Net income attributable to non-controlling interests 17 5 4 9 3 6 51 Net income 1,424 1,842 756 1,291 1,066 704 290 Add: Depreciation and amortization 613 526 502 439 452 406 117 Asset impairments 59 - 89 90 - - Interest expense, net of interest income 69 50 68 86 99 127 144 Provision for income taxes 234 568 214 70 313 468 193 Write-off of financing costs on extinguished debt 2 - 76 3 28 - - Write-down of impaired assets - - - - - - 9 One-time gain associated with remeasuring an investment in unconsolidated subsidiary to fair value as of the date the remaining controlling interest was acquired - - - - (100) - - Costs associated with our reorganization, including cost-savings initiatives - - - 50 38 - - Cost containment expenses - - - - - - 31 Costs incurred in connection with litigation settlement - - - - 9 - - Integration and other costs related to acquisitions 41 45 2 15 9 27 69 Costs associated with workforce optimization efforts - - 38 - - - - Costs associated with transformation initiatives - - 155 - - - - Carried interest incentive compensation (reversal) expense to align with the timing of associated revenue (4) 50 (23) 13 (5) (9) - Impact of fair value adjustments to real estate assets acquired in the Telford Acquisition (purchase accounting) that were sold in period (5) (6) 12 9 - - - Provision associated with Telford’s fire safety remediation efforts 186 - - - - - - Costs associated with efficiency and cost-reduction initiatives 117 - - - - - - Costs incurred related to legal entity restructuring 13 - 9 7 - - - Net fair value adjustments on strategic non-core investments 175 (54) 2 (3) - - - Net gain on deconsolidation upon merger of the SPAC with and into Altus Power, net of associated costs - (156) - - - - - Core EBITDA $2,924 $2,864 $1,898 $2,070 $1,908 $1,723 $853 Reconciliation of TTM Net Income to TTM Core EBITDA $ in millions, totals may not sum due to rounding
Slide 32 — Reconciliation of TTM Net Income to TTM Core EBITDA
2023 CBRE, Inc. | 32 Trailing Twelve Months Ended, Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 2022 2022 2022 2022 2021 2021 2021 2021 2020 2020 2020 2020 2019 2019 2019 2019 Net Income attributable to CBRE Group, Inc $1,407 $2,018 $2,007 $1,963 $1,837 $1,458 $1,207 $846 $752 $1,076 $1,148 $1,290 $1,282 $1,039 $1,072 $1,077 Net income attributable to non-controlling interests 17 12 8 7 5 6 6 5 4 4 5 4 9 8 8 9 Net income 1,424 2,031 2,016 1,969 1,842 1,464 1,213 851 756 1,080 1,153 1,294 1,291 1,047 1,080 1,087 Add: Depreciation and amortization 613 616 596 553 526 508 513 510 502 473 457 447 439 441 443 450 Asset impairments 59 37 37 10 -- 14 14 14 89 76 76 76 90 89 89 89 Interest expense, net of interest income 69 67 58 53 50 51 58 62 68 70 74 81 86 90 94 95 Provision for income taxes 234 484 475 487 568 438 354 239 214 19 34 77 70 271 303 311 Write-off of financing costs on extinguished debt 2 2 -- -- -- 76 76 76 76 -- -- -- 3 3 3 3 One-time gain associated with remeasuring an investment in unconsolidated subsidiary to fair value as of the date the remaining controlling interest was acquired -- -- -- -- -- -- -- -- -- -- -- -- -- (8) (100) (100) Costs associated with our reorganization, including cost-savings initiatives -- -- -- -- -- -- -- -- -- -- -- 34 50 75 87 54 Integration and other costs related to acquisitions 41 44 53 53 45 25 9 1 2 3 7 16 15 17 18 9 Costs associated with workforce optimization efforts -- -- -- -- -- -- -- 38 38 38 38 -- -- -- -- -- Costs associated with transformation initiatives -- -- -- -- -- 100 155 155 155 55 -- -- -- -- -- -- Carried interest incentive compensation (reversal) expense to align with the timing of associated revenue (4) 25 48 57 50 23 9 0 (23) (11) (18) (2) 13 12 19 12 Impact of fair value adjustments to real estate assets acquired in the Telford Acquisition (purchase accounting) that were sold in period (5) (11) (10) (9) (6) 3 5 7 12 19 16 15 9 -- -- -- Costs incurred related to legal entity restructuring 13 13 12 2 -- 4 5 6 9 12 11 10 7 -- -- -- Costs incurred in connection with litigation settlement -- -- -- -- -- -- -- -- -- -- -- -- -- -- 9 9 Provision associated with Telford’s fire safety remediation efforts 186 47 38 -- -- -- -- -- -- -- -- -- -- -- -- -- Costs associated with efficiency and cost-reduction initiatives 118 19 -- -- -- -- -- -- -- -- -- -- -- -- -- -- Net fair value adjustments on strategic non-core investments 175 (4) 173 108 (54) (43) (38) (24) 2 2 0 (4) (3) (3) (1) 0 Net gain on deconsolidation upon merger of the SPAC with and into Altus Power, net of associated costs - (156) (156) (156) (156) - - - - - - - - - - - Core EBITDA $2,924 $3,212 $3,339 $3,128 $2,864 $2,662 $2,372 $1,935 $1,898 $1,836 $1,848 $2,044 $2,070 $2,033 $2,044 $2,017 INVESTOR OVERVIEW Reconciliation of TTM Net Income to TTM Core EBITDA $ in millions, totals may not sum due to rounding