On this page of StockholderLetter.com we present the 4/4/2025 shareholder letter from CBRE GROUP, INC. — ticker symbol CBRE. Reading current and past CBRE letters to shareholders can bring important insights into the investment thesis.
ANNUAL REPORT 2024 CBRE GROUP, INC.
CHAIR & CEO MESSAGE April 4, 2025 Dear Fellow Shareholders: 2024 was an excellent year for CBRE, as the company advanced strategically on many fronts and produced strong growth across key financial metrics. Among many notable strategic gains, two highlights were integrating our legacy project management business into Turner & Townsend, which has achieved compound revenue growth of more than 20% annually under our ownership, and acquiring full ownership of Industrious, a company positioned to meet increasing occupier and investor demand for workplace flexibility and enhanced experience. Both moves have significant implications for CBRE s long-term growth and are consistent with the strategy we have been executing to expand our position as the world s premier real estate services and investment company. We completed a comprehensive review of our strategy in 2024 and affirmed its core elements, which include: Building a broad and deep presence across clients, services, property types and geographies. Delivering strong organic and inorganic growth, perpetuating the benefits of scale. Building differentiated services that are seamlessly integrated to deliver superior client solutions. Investing in disproportionately growing our resilient and secularly favored businesses. Leveraging our functional and knowledge platform to enhance growth and the quality of our solutions. Identifying, attracting and empowering top talent. Continually focusing on efficiency and cost to expand our margin advantage. Integrating CBRE Project Management into Turner & Townsend and acquiring Industrious were also catalysts for moving to a four-segment business structure beginning this year. This entailed, first, carving Project Management out as its own business segment. Our strategic analysis confirmed the availability of sizable new growth avenues by overseeing the construction of data centers, energy, infrastructure and other projects that benefit from secular tailwinds. It also concluded that our ability to attack these opportunities would be enhanced by uniting all our project management capabilities under Turner & Townsend s leadership. Next, we created a new Building Operations & Experience (BOE) segment comprised of enterprise and local facilities management, property management and Industrious. Our strategy work identified many benefits from bringing our building operations resources and capabilities from technical services to preventive maintenance to procurement together in one segment and tying them closely with our newly enhanced experience services. Enhanced Senior Leadership Besides a larger total addressable market, Turner & Townsend and Industrious have also deepened our pool of talent, highlighted by Vincent Clancy and Jamie Hodari, the leaders of our Project Management and BOE segments, respectively. Turner & Townsend s longtime CEO, Vincent is an adept global business leader who s grown the company s revenues from $225 million in 2008 to nearly $2.2 billion in 2024. We are so impressed by Vincent s performance that we added him to the CBRE Board of Directors in January 2025.
CHAIR & CEO MESSAGE Jamie, Industrious founder, has deep knowledge of the intersection between workplace operations and experience and is already having a meaningful impact on both our go-to-market strategy and the innovative services we are delivering to clients. We fortified our leadership team in other ways in 2024. One prominent move was empowering our Chief Operating Officer Vikram Kohli with responsibility for driving our Advisory Services segment, as its CEO. Few executives can match Vikram s ability to marry technology with service delivery and financial insight. Under his leadership, we are making gains across our leasing, capital markets, valuations and loan servicing business lines. We also markedly upgraded the leadership of our Investment Management business by appointing Adam Gallistel, who joined CBRE this month, and Andy Glanzman as Co-CEOs. Adam forged an exceptional investment track record as leader of GIC s Americas business, and Andy has proven to be a strong operational leader who has overseen CBRE Investment Management s strategic evolution. Capital Deployment We put approximately $2 billion of capital to work last year in mergers-and-acquisition activity, real estate coinvestment and share repurchases. Two of our major acquisitions last year reflected our strategy to invest in resilient businesses that augment our growth profile and expand our total addressable market. These were our purchase of J&J Worldwide Services, a provider of facilities management and related services primarily for U.S. Department of Defense military bases and health-care facilities, and Direct Line Global, a provider of specialized technical services for the management of data centers. Both companies give us an increased footprint in sectors where we previously had only a limited presence. Our development in-process and pipeline portfolio increased by $3.3 billion during 2024 to more than $32 billion, with outstanding balance sheet equity co-investment of approximately $800 million at year-end. We capitalized almost 30 real estate development projects during the year at a time when most investors were on the sidelines including a large industrial asset portfolio during the fourth quarter. We believe our current development portfolio will generate more than $900 million of net profits over the next five years. We repurchased more than $915 million worth of shares from January 1, 2024 through February 11, 2025, just before we reported our fourth-quarter results, as we saw significant unrecognized value in CBRE shares. We have high conviction in our growth prospects and believe our ability to consistently generate double-digit organic earnings growth, augmented further by capital allocation, justifies a premium through-cycle multiple. Our balance sheet remains strong with substantial capacity to continue investing. Despite significant capital deployment, we ended 2024 with less than one turn of net leverage. 2024 Financial Results The strategic gains we made across the business, coupled with an improved operating backdrop, bolstered CBRE s growth in 2024, culminating in record fourth-quarter performance across most financial metrics. We delivered broad-based, double-digit growth for the company overall and across our business segments. For the year, net revenue(1) increased 14% in both our resilient (including facilities management, project management, property management, loan servicing, recurring investment management fees and valuations) and transactional (property sales, leasing, mortgage origination, carried interest and incentive fees in our investment management business, and development fees) businesses. Resilient businesses contributed nearly 60% of our total segment operating profit(1) for the year, essentially matching 2023, a notable achievement in a year when transaction activity started to see a cyclical recovery. We also demonstrated an ability to manage costs effectively. Early in the year, we determined that our expense base in the Global Workplace Solutions segment had become misaligned with our revenue trajectory. We moved decisively to remove excess costs and grew full-year margins by year end with further expansion expected this year as well.
CHAIR & CEO MESSAGE Core earnings-per-share(1) increased by 33% and free cash flow(1) exceeded $1.5 billion. We have continued our focus on improving our working capital management and are seeing the result of these efforts. Free cash flow conversion this year should be within our 75% to 85% target range. 2025 Outlook(2) For 2025, we are poised to further benefit from the strategic work we ve done to create a resilient, growth-oriented enterprise capable of sustaining double-digit bottom-line growth. Our core earnings-per-share is expected to reach a new peak this year, supported by mid-teens operating profit growth from our resilient businesses, and a continued recovery in our transactional businesses. That said, we are mindful of the risks associated with an uncertain global economic environment. Our People Our people are the foundation of CBRE s success, and both our clients and our company benefit from their relentless focus on excellence. We create conditions where they can thrive by fostering a values-driven culture that enables our team members to realize their potential. Insights into our culture, values and community impact will be published later this year in our 2024 Corporate Responsibility Report. As always, we greatly appreciate your support as we work to enhance shareholder value. Our virtual annual Stockholder Meeting will be held this year on Wednesday, May 21. I hope you can join us. Sincerely, Robert E. Sulentic Chair & Chief Executive Officer CBRE Group, Inc. (1) These are non-GAAP financial measures. Please refer to Annex A on the last page of this Annual Report for more information and a reconciliation to GAAP measures, where applicable. (2) Please refer to Annex A on the last page of this Annual Report for a discussion of the forward-looking statements contained in this shareholder letter.
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CBRE 4/4/2025 Shareholder/Stockholder Letter Transcript:

ANNUAL REPORT
2024
CBRE GROUP, INC.


CHAIR & CEO MESSAGE
April 4, 2025
Dear Fellow Shareholders:
2024 was an excellent year for CBRE, as the company advanced strategically on many fronts and produced strong
growth across key financial metrics.
Among many notable strategic gains, two highlights were integrating our legacy project management business into
Turner & Townsend, which has achieved compound revenue growth of more than 20% annually under our ownership,
and acquiring full ownership of Industrious, a company positioned to meet increasing occupier and investor demand
for workplace flexibility and enhanced experience.
Both moves have significant implications for CBRE   s long-term growth and are consistent with the strategy we have
been executing to expand our position as the world   s premier real estate services and investment company. We
completed a comprehensive review of our strategy in 2024 and affirmed its core elements, which include:

Building a broad and deep presence across clients, services, property types and geographies.

Delivering strong organic and inorganic growth, perpetuating the benefits of scale.

Building differentiated services that are seamlessly integrated to deliver superior client solutions.

Investing in disproportionately growing our resilient and secularly favored businesses.

Leveraging our functional and knowledge platform to enhance growth and the quality of our solutions.

Identifying, attracting and empowering top talent.

Continually focusing on efficiency and cost to expand our margin advantage.
Integrating CBRE Project Management into Turner & Townsend and acquiring Industrious were also catalysts for
moving to a four-segment business structure beginning this year. This entailed, first, carving Project Management out
as its own business segment. Our strategic analysis confirmed the availability of sizable new growth avenues by
overseeing the construction of data centers, energy, infrastructure and other projects that benefit from secular
tailwinds. It also concluded that our ability to attack these opportunities would be enhanced by uniting all our project
management capabilities under Turner & Townsend   s leadership.
Next, we created a new Building Operations & Experience (BOE) segment comprised of enterprise and local facilities
management, property management and Industrious. Our strategy work identified many benefits from bringing our
building operations resources and capabilities     from technical services to preventive maintenance to procurement    
together in one segment and tying them closely with our newly enhanced experience services.
Enhanced Senior Leadership
Besides a larger total addressable market, Turner & Townsend and Industrious have also deepened our pool of talent,
highlighted by Vincent Clancy and Jamie Hodari, the leaders of our Project Management and BOE segments,
respectively.
Turner & Townsend   s longtime CEO, Vincent is an adept global business leader who   s grown the company   s revenues
from $225 million in 2008 to nearly $2.2 billion in 2024. We are so impressed by Vincent   s performance that we added
him to the CBRE Board of Directors in January 2025.

CHAIR & CEO MESSAGE
Jamie, Industrious    founder, has deep knowledge of the intersection between workplace operations and experience
and is already having a meaningful impact on both our go-to-market strategy and the innovative services we are
delivering to clients.
We fortified our leadership team in other ways in 2024. One prominent move was empowering our Chief Operating
Officer Vikram Kohli with responsibility for driving our Advisory Services segment, as its CEO. Few executives can
match Vikram   s ability to marry technology with service delivery and financial insight. Under his leadership, we are
making gains across our leasing, capital markets, valuations and loan servicing business lines.
We also markedly upgraded the leadership of our Investment Management business by appointing Adam Gallistel,
who joined CBRE this month, and Andy Glanzman as Co-CEOs. Adam forged an exceptional investment track record
as leader of GIC   s Americas business, and Andy has proven to be a strong operational leader who has overseen CBRE
Investment Management   s strategic evolution.
Capital Deployment
We put approximately $2 billion of capital to work last year in mergers-and-acquisition activity, real estate coinvestment and share repurchases. Two of our major acquisitions last year reflected our strategy to invest in resilient
businesses that augment our growth profile and expand our total addressable market. These were our purchase of
J&J Worldwide Services, a provider of facilities management and related services primarily for U.S. Department of
Defense military bases and health-care facilities, and Direct Line Global, a provider of specialized technical services
for the management of data centers. Both companies give us an increased footprint in sectors where we previously
had only a limited presence.
Our development in-process and pipeline portfolio increased by $3.3 billion during 2024 to more than $32 billion, with
outstanding balance sheet equity co-investment of approximately $800 million at year-end. We capitalized almost 30
real estate development projects during the year     at a time when most investors were on the sidelines     including a
large industrial asset portfolio during the fourth quarter. We believe our current development portfolio will generate
more than $900 million of net profits over the next five years.
We repurchased more than $915 million worth of shares from January 1, 2024 through February 11, 2025, just before
we reported our fourth-quarter results, as we saw significant unrecognized value in CBRE shares. We have high
conviction in our growth prospects and believe our ability to consistently generate double-digit organic earnings
growth, augmented further by capital allocation, justifies a premium through-cycle multiple.
Our balance sheet remains strong with substantial capacity to continue investing. Despite significant capital
deployment, we ended 2024 with less than one turn of net leverage.
2024 Financial Results
The strategic gains we made across the business, coupled with an improved operating backdrop, bolstered CBRE   s
growth in 2024, culminating in record fourth-quarter performance across most financial metrics.
We delivered broad-based, double-digit growth for the company overall and across our business segments. For the
year, net revenue(1) increased 14% in both our resilient (including facilities management, project management,
property management, loan servicing, recurring investment management fees and valuations) and transactional
(property sales, leasing, mortgage origination, carried interest and incentive fees in our investment management
business, and development fees) businesses. Resilient businesses contributed nearly 60% of our total segment
operating profit(1) for the year, essentially matching 2023, a notable achievement in a year when transaction activity
started to see a cyclical recovery.
We also demonstrated an ability to manage costs effectively. Early in the year, we determined that our expense base
in the Global Workplace Solutions segment had become misaligned with our revenue trajectory. We moved decisively
to remove excess costs and grew full-year margins by year end with further expansion expected this year as well.

CHAIR & CEO MESSAGE
Core earnings-per-share(1) increased by 33% and free cash flow(1) exceeded $1.5 billion. We have continued our focus
on improving our working capital management and are seeing the result of these efforts. Free cash flow conversion
this year should be within our 75% to 85% target range.
2025 Outlook(2)
For 2025, we are poised to further benefit from the strategic work we   ve done to create a resilient, growth-oriented
enterprise capable of sustaining double-digit bottom-line growth. Our core earnings-per-share is expected to reach a
new peak this year, supported by mid-teens operating profit growth from our resilient businesses, and a continued
recovery in our transactional businesses. That said, we are mindful of the risks associated with an uncertain global
economic environment.
Our People
Our people are the foundation of CBRE   s success, and both our clients and our company benefit from their relentless
focus on excellence. We create conditions where they can thrive by fostering a values-driven culture that enables our
team members to realize their potential. Insights into our culture, values and community impact will be published later
this year in our 2024 Corporate Responsibility Report.
As always, we greatly appreciate your support as we work to enhance shareholder value. Our virtual annual
Stockholder Meeting will be held this year on Wednesday, May 21. I hope you can join us.
Sincerely,
Robert E. Sulentic
Chair & Chief Executive Officer
CBRE Group, Inc.

(1)
These are non-GAAP financial measures. Please refer to Annex A on the last page of this Annual Report for more
information and a reconciliation to GAAP measures, where applicable.
(2)
Please refer to Annex A on the last page of this Annual Report for a discussion of the forward-looking statements
contained in this shareholder letter.


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