CBRE Group Inc.

10/22/2026 | Press release | Distributed by Public on 10/22/2026 14:42

Quarterly Report for Quarter Ending September 30, 2026 (Form 10-Q)

Management's Discussion and Analysis of Financial Condition and Results of Operations
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, 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.
In addition, the statements and assumptions in this Quarterly Report that are not statements of historical fact are
forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 or Section 21E of the Securities
Exchange Act of 1934, each as amended, including, in particular, statements about our plans, strategies and prospects as well as
estimates of industry growth for the next quarter and beyond. For important information regarding these forward-looking
statements, please see the discussion below under the caption "Cautionary Note on Forward-Looking Statements."
Beginning with first-quarter 2026 results, we reclassified amortization associated with MSRs (mortgage servicing
rights) to net against the related revenue (commercial mortgage origination). Historically, we have recognized the
corresponding MSR intangible asset as an amortization expense over the estimated mortgage service period. Prior year amounts
have been reclassified to conform with the 2026 presentation.
Business Environment
Outsized investments in artificial intelligence and data center buildouts have fueled continued strong demand for
critical infrastructure services, while large occupiers' growing appetite for outsourcing services continued to underpin demand
for facilities management and project management activities. The commercial real estate market recovery continued. In the
third quarter, leasing volumes were notably strong in the U.K., while growth in the U.S. was muted given a tougher year-ago
comparison. Global investment sales activity remained strong, most notably in the U.S.; however, transaction activity slowed
late in the period as the 10-year Treasury rate rose rapidly to well above 5%. Through the first nine months of 2026, the
ongoing Middle East conflict has had limited direct impact on CBRE's business except for a slowdown in fundraising from
capital sources based in the region.
Capital Allocation
We deployed $1.2 billion in 2026 to repurchase 8,398,578 shares as of October 20, 2026.
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Results of Operations
The following table sets forth items derived from our consolidated statements of operations for the three and nine
months ended September 30, 2026 and 2025 (dollars in millions):
Three Months Ended September 30, (1)
Nine Months Ended September 30, (1)
2026
2025
2026
2025
Revenue:
Facilities management
$5,401
46.9%
$4,771
46.7%
$15,941
47.9%
$14,024
48.7%
Property management
6.2%
6.4%
2,094
6.3%
1,889
6.6%
Critical infrastructure
6.5%
4.1%
1,998
6.0%
1,155
4.0%
Project management
2,035
17.7%
1,978
19.4%
5,918
17.8%
5,289
18.4%
Advisory leasing
1,213
10.5%
1,144
11.2%
3,477
10.5%
3,001
10.4%
Valuation
1.8%
1.9%
1.9%
2.0%
Loan servicing
1.1%
1.2%
1.1%
1.3%
Other portfolio services
0.9%
0.9%
0.8%
0.9%
Capital markets:
Advisory sales
6.1%
5.3%
1,761
5.3%
1,364
4.7%
Commercial mortgage origination
0.9%
1.0%
0.8%
0.8%
Investment management
1.3%
1.4%
1.4%
1.6%
Development services
0.4%
0.6%
0.4%
0.7%
Corporate, other and eliminations
(18)
(0.2)%
(9)
(0.1)%
(47)
(0.1)%
(20)
(0.1)%
Total revenue
11,517
100.0%
10,221
100.0%
33,270
100.0%
28,813
100.0%
Costs and expenses:
Pass-through costs (2)
4,691
40.7%
4,212
41.2%
13,761
41.4%
12,095
42.0%
Cost of revenue, excluding pass-through costs
4,701
40.8%
4,092
40.0%
13,446
40.4%
11,416
39.6%
Operating, administrative and other
1,564
13.6%
1,327
13.0%
4,560
13.7%
3,794
13.2%
Depreciation and amortization
1.6%
1.4%
1.7%
1.5%
Total costs and expenses
11,140
96.7%
9,776
95.6%
32,323
97.2%
27,737
96.3%
Gain on disposition of real estate
1.6%
0.4%
1.5%
0.2%
Operating income
4.9%
4.7%
1,437
4.3%
1,131
3.9%
Equity income from unconsolidated subsidiaries
0.9%
0.5%
0.3%
0.2%
Other income
0.1%
0.0%
0.1%
0.0%
Interest expense, net of interest income
0.5%
0.5%
0.5%
0.6%
Write-off of financing costs on extinguished debt
-
0.0%
-
0.0%
-
0.0%
0.0%
Income before provision for income taxes
5.3%
4.8%
1,380
4.1%
1,030
3.6%
Provision for income taxes
1.1%
0.9%
0.9%
0.7%
Net income
4.2%
3.9%
1,069
3.2%
2.9%
Less: Net income attributable to non-controlling interests
0.3%
0.3%
0.3%
0.3%
Net income attributable to CBRE Group, Inc.
$443
3.8%
$363
3.6%
$965
2.9%
$741
2.6%
Core EBITDA
$1,001
8.7%
$779
7.6%
$2,668
8.0%
$1,923
6.7%
________________________________________________________________________________________________________________________________________
(1)Calculated as a percentage of total revenue.
(2)Pass-through costs represent certain costs incurred associated with subcontracted third-party vendor work performed for clients. These costs are
reimbursable by clients and the corresponding amounts owed are reflected within Revenue.
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Three Months Ended September 30, 2026 Compared to the Three Months Ended September 30, 2025
We reported net income attributable to CBRE Group, Inc. of $443 million for the quarter, on revenue of $11.5 billion
as compared to $363 million on revenue of $10.2 billion in the prior year.
Revenue increased 12.7% reflecting double-digit growth across the Advisory Services and Building Operations &
Experience (BOE) segments and single-digit growth in the Project Management segment, partially offset by a decrease in
revenue in the Real Estate Investments (REI) segment.
Foreign currency translation had a 0.2% negative impact on revenue, reflecting weakness in the Indian rupee, Japanese
yen and euro partially offset by strength in the Australian dollar.
Pass-through costs increased 11.4% during the quarter as compared to the same period in prior year primarily due to
growth in the BOE segment. Foreign currency translation had a 0.4% positive impact on pass-through costs.
Cost of revenue, excluding pass-through costs increased 14.9% during the quarter as compared to the same period in
prior year primarily driven by business growth and higher employee compensation and commission expenses. Foreign currency
translation had a 0.1% negative impact on total cost of revenue, excluding pass-through costs. Cost of revenue, excluding pass-
through costs increased to 40.8% of total revenue from 40.0% resulting from higher costs to support growth in revenues.
Operating, administrative and other expenses increased 17.9% during the quarter as compared to the same period in
prior year due to higher employee compensation expense, attributable to business growth. Foreign currency translation had a
0.1% positive impact on total operating expenses during the quarter. Operating, administrative and other expenses as a
percentage of revenue increased to 13.6% in the third quarter 2026 from 13.0% in the third quarter 2025, as operating expenses
grew higher than revenue.
Depreciation and amortization expense increased by 26.9% during the quarter, as compared to the same period in prior
year, reflecting higher amortization expense related to intangible assets from recent acquisitions, such as Pearce.
Gain on disposition of real estate increased by $148 million during the quarter, due to higher sales of real estate
development assets in the REI segment.
We recorded equity income from unconsolidated subsidiaries of approximately $104 million, compared to equity
income of $52 million in the third quarter 2025 primarily due monetization of real estate development assets in the current
period.
Interest expense, net of interest income, increased by 24.0%, compared with the third quarter 2025. This increase was
primarily attributable to the issuance of $1.5 billion in senior notes, offset by the impact of net investment hedging activity.
Our provision for income taxes on a consolidated basis was $131 million for the three months ended September 30,
2026 as compared to a provision for income taxes of $90 million for the three months ended September 30, 2025. The increase
of $41 million is primarily related to an increase in earnings and a reduction of favorable permanent book tax differences. Our
effective tax rate increased to 21.4% for the three months ended September 30, 2026 from 18.5% for the three months ended
September 30, 2025. Our effective tax rate for the three months ended September 30, 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.
Legislative Developments
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.
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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.
Nine Months Ended September 30, 2026 Compared to the Nine Months Ended September 30, 2025
We reported net income attributable to CBRE Group, Inc. of $965 million for the nine months ended September 30,
2026 on revenue of $33.3 billion as compared to $741 million on revenue of $28.8 billion for the nine months ended
September 30, 2025.
Revenue increased 15.5%, reflecting double-digit growth across the Advisory Services, BOE and Project Management
segments, partially offset by a decrease in revenue in the REI segment.
Foreign currency translation had a 1.6% positive impact on total revenue during the nine months ended September 30,
2026, primarily driven by strength in the euro and British pound sterling, partially offset by weakness in the Indian rupee and
Japanese yen.
Pass-through costs increased 13.8% during the nine months ended September 30, 2026 as compared to the same period
in 2025 primarily due to revenue growth in the BOE and Project Management segments. Foreign currency translation had a
1.6% negative impact on pass-through costs.
Cost of revenue, excluding pass-through costs increased 17.8% during the nine months ended September 30, 2026 as
compared to the same period in 2025 due to business growth and higher employee compensation and commission expenses.
Foreign currency translation had a 1.7% negative impact on total cost of revenue, excluding pass-through costs. Cost of
revenue, excluding pass-through costs increased to 40.4% of total revenue from 39.6%.
Operating, administrative and other expenses increased 20.2% during the nine months ended September 30, 2026 as
compared to the same period last year primarily due to an increase in the provision related to fire safety remediation efforts for
buildings historically developed by our subsidiary, Telford Homes (see Note 17 - Telford Fire Safety Remediation). In
addition, operating, administrative and other expenses increased due to higher employee compensation expense, as a result of
business growth. Foreign currency translation had a 1.6% negative impact on total operating expenses during the nine months
ended September 30, 2026. Operating, administrative and other expenses as a percentage of revenue increased to 13.7% from
13.2%, as operating expenses grew faster than revenue.
Depreciation and amortization expense increased by 28.7% during the nine months ended September 30, 2026 as
compared to the same period in 2025, reflecting higher depreciation and amortization expense related to assets acquired from
recent acquisitions, such as Pearce.
Gain on disposition of real estate increased by $435 million during the nine months ended September 30, 2026, driven
by monetization of real estate development assets in the REI segment.
We reported equity income from unconsolidated subsidiaries of approximately $99 million during the nine months
ended September 30, 2026 versus equity income of $50 million in the same period in 2025 primarily due to higher monetization
of real estate development assets in the current period.
Interest expense, net of interest income, increased by 13.8% for the nine months ended September 30, 2026, compared
to the same period in 2025. This increase was primarily attributable to the issuance of $1.5 billion in senior notes, offset by the
impact of net investment hedging activity.
Our provision for income taxes on a consolidated basis was $311 million for the nine months ended September 30,
2026 as compared to a provision for income taxes of $203 million in 2025. The increase of $108 million is primarily related to
an increase in current year earnings and a reduction of favorable permanent book tax differences. Our effective tax rate
increased to 22.5% in the nine months ended September 30, 2026 as compared to 19.7% in 2025. Our effective tax rate for the
nine months ended September 30, 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.
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Segment Operations
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.
Advisory Services provides a comprehensive range of services globally, including leasing, capital markets (property
sales and mortgage 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.
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.
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Advisory Services
The following table summarizes our results of operations for our Advisory Services operating segment for the three
and nine months ended September 30, 2026 and 2025 (dollars in millions):
Three Months Ended September 30, (1)
Nine Months Ended September 30, (1)
2026
2025
2026
2025
Revenue:
Advisory leasing
$1,213
49.7%
$1,144
52.0%
$3,477
51.4%
$3,001
51.6%
Valuation
8.4%
8.8%
9.2%
9.9%
Loan servicing
5.2%
5.8%
5.4%
6.3%
Other portfolio services
4.0%
4.0%
3.9%
4.6%
Capital markets:
Advisory sales
28.6%
24.8%
1,761
26.0%
1,364
23.4%
Commercial mortgage origination
4.1%
4.5%
4.1%
4.2%
Total segment revenue
2,441
100.0%
2,199
100.0%
6,771
100.0%
5,817
100.0%
Costs and expenses:
Pass-through costs (2)
0.7%
0.6%
0.5%
0.7%
Cost of revenue, excluding pass-through costs
1,482
60.7%
1,297
59.0%
4,021
59.4%
3,403
58.5%
Operating, administrative and other
19.9%
21.9%
1,459
21.5%
1,364
23.4%
Depreciation and amortization
1.2%
1.5%
1.4%
1.6%
Total costs and expenses
2,014
82.5%
1,825
83.0%
5,608
82.8%
4,901
84.3%
Operating income
17.5%
17.0%
1,163
17.2%
15.7%
Equity income (loss) from unconsolidated subsidiaries
0.0%
-
0.0%
(2)
0.0%
-
0.0%
Other income
0.1%
0.0%
0.0%
0.1%
Add-back: Depreciation and amortization
1.2%
1.5%
1.4%
1.6%
Adjustments:
Net non-cash mortgage servicing rights
0.2%
(5)
(0.2)%
0.4%
0.2%
Impact of fair value non-cash adjustments related to
unconsolidated equity investments
-
0.0%
-
0.0%
-
0.0%
0.0%
Business and finance transformation
0.0%
-
0.0%
0.1%
-
0.0%
Costs associated with efficiency and cost-reduction
initiatives
-
0.0%
-
0.0%
(5)
(0.1)%
-
0.0%
Segment operating profit
$467
$403
$1,291
$1,029
________________________________________________________________________________________________________________________________________
(1)Calculated as a percentage of total segment revenue.
(2)Pass-through costs represent certain costs incurred associated with subcontracted third-party vendor work performed for clients. These costs are
reimbursable by clients and the corresponding amounts owed are reflected within Revenue.
Three Months Ended September 30, 2026 Compared to the Three Months Ended September 30, 2025
Revenue increased 11.0% during the quarter compared to the same period in 2025. Global leasing revenue rose 6.0%,
led by industrial and data centers sectors. Europe, Middle East and Africa (EMEA) grew 21.2%, while the Americas grew with
the United States up 3.9%. Property sales revenue grew 27.9%, driven primarily by growth in the U.S. across industrial, retail,
hotels and data centers, with Asia Pacific and EMEA also contributing to growth in the period.
Foreign currency translation had a 0.2% negative impact on total revenue during the quarter, primarily driven by
weakness in the Japanese yen partially offset by strength in the Australian dollar.
Cost of revenue, excluding pass-through costs increased 14.3%, primarily reflecting business growth and higher
commission expense, salaries and bonus. Foreign currency translation had a 0.1% positive impact on total cost of revenue,
excluding pass-through costs.
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Operating, administrative and other expenses increased by 1.0%, as compared to the same period in 2025. Foreign
currency translation had a 0.2% positive impact on total operating expenses.
For the three months ended September 30, 2026, gross income from mortgage servicing rights (MSRs) was
$33 million, offset by $39 million of amortization of related intangible assets, resulting in a net reduction to commercial
mortgage origination revenue of $6 million. For the three months ended September 30, 2025, the comparable amounts were
$41 million and $36 million, respectively, resulting in a net increase of $5 million. The shift from a net increase to a net
reduction reflects lower origination gains, as recent originations have shifted to shorter loan terms in a higher rate environment,
with amortization remaining elevated on the servicing book established during the prior low-rate period.
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 the MSRs on the date the loans are sold. Upon origination of a mortgage loan held for
sale, the fair value of the MSRs to be retained is included in the 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 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 with the fiscal 2026
presentation.
Nine Months Ended September 30, 2026 Compared to the Nine Months Ended September 30, 2025
Revenue increased 16.4% for the nine months ended September 30, 2026 as compared to the same period in 2025.
Property sales revenue increased 29.1%, due to growth in the U.S. across industrial, multifamily, retail and office centers; with
EMEA and APAC also contributing to growth. Global leasing revenue rose 15.9%, led by office, industrial and data centers
leasing driven by EMEA which grew 21.6%, Americas including 15.2% in the United States, and APAC which grew 13.4%.
Foreign currency translation had a 1.0% positive impact on total revenue during the nine months ended September 30,
2026, primarily driven by strength in the Australian dollar and euro, partially offset by weakness in the Japanese yen and Indian
rupee.
Cost of revenue, excluding pass-through costs increased 18.2%, primarily reflecting business growth and higher
commission expense, salaries and bonus. Foreign currency translation had a 1.1% negative impact on total cost of revenue,
excluding pass-through costs.
Operating, administrative and other expenses increased by 7.0% for the nine months ended September 30, 2026 as
compared to the same period in 2025, primarily due to higher employee compensation and bonus and higher business
promotion and advertising expense, due to growth in the business. Foreign currency translation had a 1.7% negative impact on
total operating expenses.
For the nine months ended September 30, 2026, gross income from MSRs was $86 million, offset by $115 million of
amortization of related MSR intangible assets, resulting in a net reduction to commercial mortgage origination revenue of
$29 million. For the nine months ended September 30, 2025, the comparable amounts were $96 million and $108 million,
respectively, resulting in a net reduction of $12 million. The increase in the net reduction reflects both lower origination gains,
as recent originations have shifted to shorter loan terms in a higher rate environment, and higher amortization on the servicing
book established during the prior low-rate period.
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Building Operations & Experience
The following table summarizes our results of operations for our BOE operating segment for the three and nine months
ended September 30, 2026 and 2025 (dollars in millions):
Three Months Ended September 30, (1)
Nine Months Ended September 30, (1)
2026
2025
2026
2025
Revenue:
Facilities management
$5,401
78.8%
$4,771
81.7%
$15,941
79.6%
$14,024
82.2%
Property management
10.4%
11.2%
2,094
10.5%
1,889
11.1%
Critical infrastructure
10.9%
7.1%
1,998
10.0%
1,155
6.8%
Total segment revenue
6,856
100.0%
5,842
100.0%
20,033
100.0%
17,068
100.0%
Costs and expenses:
Pass-through costs (2)
3,641
53.1%
3,118
53.4%
10,688
53.4%
9,265
54.3%
Cost of revenue, excluding pass-through costs
2,507
36.6%
2,125
36.4%
7,339
36.6%
6,110
35.8%
Operating, administrative and other
5.9%
6.0%
1,165
5.8%
5.8%
Depreciation and amortization
1.6%
1.1%
1.6%
1.1%
Total costs and expenses
6,665
97.2%
5,660
96.9%
19,517
97.4%
16,566
97.1%
Operating income
2.8%
3.1%
2.6%
2.9%
Equity income (loss) from unconsolidated subsidiaries
0.0%
0.0%
0.0%
(14)
(0.1)%
Other income
0.1%
0.0%
0.1%
0.0%
Add-back: Depreciation and amortization
1.6%
1.1%
1.6%
1.1%
Adjustments:
Integration and other costs related to acquisitions
0.4%
0.3%
0.3%
0.4%
Net results related to the wind-down of certain
businesses (3)
0.0%
0.4%
0.0%
0.1%
Business and finance transformation
0.2%
-
0.0%
0.2%
-
0.0%
Segment operating profit
$349
$289
$964
$774
________________________________________________________________________________________________________________________________________
(1)Calculated as a percentage of total segment revenue.
(2)Pass-through costs represent certain costs incurred associated with subcontracted third-party vendor work performed for clients. These costs are
reimbursable by clients and the corresponding amounts owed are reflected within Revenue.
(3)Management made the decision to wind down certain businesses within the BOE Segment.
Three Months Ended September 30, 2026 Compared to the Three Months Ended September 30, 2025
Revenue increased 17.4%, primarily due to strong growth in critical infrastructure and facilities management. Critical
infrastructure reflected expansion of CBRE's work for data centers, as well as contribution from the recent Pearce acquisition.
Facilities management was once again driven by strong growth in our local facilities management business, notably in the
Americas. Enterprise facilities management revenue growth was led by strong activity across the technology, financial services
and energy sectors. Foreign currency translation had a 0.1% negative impact on total revenue during the quarter, primarily
driven by weakness in the Indian rupee partially offset by strength in the Australian dollar.
Pass-through costs increased 16.8% during the quarter as compared to the same period in 2025 primarily due to
revenue growth. Foreign currency translation had a 0.3% positive impact on pass-through costs.
Cost of revenue, excluding pass-through costs increased 18.0%, driven primarily by professional compensation costs
associated with revenue growth. Foreign currency translation had a 0.1% negative impact on total cost of revenue, excluding
pass-through costs. Cost of revenue, excluding pass-through costs was 36.6% of total revenue, compared to 36.4% in the third
quarter 2025.
Operating, administrative and other expenses increased 15.6%, primarily due to higher employee compensation.
Foreign currency translation had a 0.3% negative impact on total operating expenses during the quarter.
Depreciation and amortization expense increased 69.2%, reflecting higher amortization expense related to intangible
assets from recent acquisitions, such as Pearce.
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Nine Months Ended September 30, 2026 Compared to the Nine Months Ended September 30, 2025
Revenue increased 17.4% for the nine months ended September 30, 2026 as compared to the same period in 2025,
reflecting double-digit growth in critical infrastructure, facilities management and property management, primarily due to
growth from new client wins driving increased management fees and reimbursements as well as the impact from recent
acquisitions. Foreign currency translation had a 1.8% positive impact on total revenue, primarily driven by strength in the euro
and British pound sterling, and partially offset by weakness in the Indian rupee.
Pass-through costs increased 15.4% during the nine months ended September 30, 2026 as compared to the same period
in 2025 primarily due to revenue growth. Foreign currency translation had a 1.8% negative impact on pass-through costs.
Cost of revenue, excluding pass-through costs increased 20.1%, driven primarily by professional compensation costs
associated with revenue growth. 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, an increase from 35.8% for the
nine months ended September 30, 2025.
Operating, administrative and other expenses increased 17.1%, primarily due to higher employee compensation.
Foreign currency translation had a 1.9% negative impact on total operating expenses during the nine months ended
September 30, 2026.
Depreciation and amortization expense increased 65.8%, reflecting higher amortization expense related to intangible
assets from recent acquisitions, such as Pearce.
Project Management
The following table summarizes our results of operations for our Project Management operating segment for the three
and nine months ended September 30, 2026 and 2025 (dollars in millions):
Three Months Ended September 30, (1)
Nine Months Ended September 30, (1)
2026
2025
2026
2025
Segment revenue
$2,035
100.0%
$1,978
100.0%
$5,918
100.0%
$5,289
100.0%
Costs and expenses:
Pass-through costs (2)
1,034
50.8%
1,080
54.6%
3,041
51.4%
2,791
52.8%
Cost of revenue, excluding pass-through costs
34.9%
32.0%
2,047
34.6%
1,782
33.7%
Operating, administrative and other
6.5%
6.1%
6.6%
6.7%
Depreciation and amortization
1.3%
1.4%
1.3%
1.5%
Total costs and expenses
1,902
93.5%
1,859
94.0%
5,559
93.9%
5,004
94.6%
Operating income
6.5%
6.0%
6.1%
5.4%
Other income
0.0%
-
0.0%
0.0%
0.0%
Add-back: Depreciation and amortization
1.3%
1.4%
1.3%
1.5%
Adjustments:
Integration and other costs related to acquisitions
0.1%
0.1%
0.1%
0.2%
Segment operating profit
$162
$148
$444
$375
________________________________________________________________________________________________________________________________________
(1)Calculated as a percentage of total segment revenue.
(2)Pass-through costs represent certain costs incurred associated with subcontracted third-party vendor work performed for clients. These costs are
reimbursable by clients and the corresponding amounts owed are reflected within Revenue.
Three Months Ended September 30, 2026 Compared to the Three Months Ended September 30, 2025
Revenue increased 2.9% due to strong gains in real estate projects in North America and strong infrastructure activity
in the United Kingdom, partially offset by headwinds in the Middle East and Europe. Foreign currency translation had a 0.3%
negative impact on total revenue during the quarter, primarily driven by weakness in the Indian rupee partially offset by
strength in the Australian dollar.
Pass-through costs decreased 4.3% during the quarter as compared to the same period in 2025 primarily due to lower
spend on client-funded programs. Foreign currency translation had a 0.5% positive impact on pass-through costs.
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Cost of revenue, excluding pass-through costs increased 12.3%, due to increased professional compensation and third
party spend. Foreign currency translation had a negligible impact on total cost of revenue, excluding pass-through costs. Cost of
revenue, excluding pass-through costs was 34.9% of total revenue, compared to 32.0% in the third quarter 2025.
Operating, administrative and other expenses increased 10.0%, primarily due to higher employee compensation related
expenses. Foreign currency translation had a 0.8% positive impact on total operating expenses during the quarter.
Nine Months Ended September 30, 2026 Compared to the Nine Months Ended September 30, 2025
Revenue increased 11.9% for the nine months ended September 30, 2026, led by strong business activity in the United
Kingdom, Europe, North America and the Middle East supported by strong growth in real estate and energy. Foreign currency
translation had a 1.5% positive impact on total revenue, primarily driven by strength in the British pound sterling and euro, and
partially offset by weakness in the Indian rupee.
Pass-through costs increased 9.0% during the nine months ended September 30, 2026 as compared to the same period
in 2025 primarily due to higher spend on client-funded programs. Foreign currency translation had a 0.9% negative impact on
pass-through costs.
Cost of revenue, excluding pass-through costs increased 14.9%, attributable to increased professional compensation
and third party spend. Foreign currency translation had a 2.3% negative impact on total cost of revenue, excluding pass-through
costs. Cost of revenue, excluding pass-through costs was 34.6% of total revenue and up from 33.7% during the nine months
ended September 30, 2025.
Operating, administrative and other expenses increased 11.3%, primarily due to higher employee compensation related
expenses and higher office management and administrative salaries. Foreign currency translation had a 2.0% negative impact
on total operating expenses during the nine months ended September 30, 2026.
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Real Estate Investments
The following table summarizes our results of operations for our REI operating segment for the three and nine months
ended September 30, 2026 and 2025 (dollars in millions):
Three Months Ended September 30, (1)
Nine Months Ended September 30, (1)
2026
2025
2026
2025
Revenue:
Investment management
$154
75.9%
$148
70.1%
$457
76.8%
$447
67.8%
Development services
24.1%
29.9%
23.2%
32.2%
Total segment revenue
100.0%
100.0%
100.0%
100.0%
Costs and expenses:
Cost of revenue
1.5%
18.5%
7.4%
18.4%
Operating, administrative and other
163.1%
91.0%
156.1%
81.9%
Depreciation and amortization
2.5%
0.9%
3.0%
1.2%
Total costs and expenses
167.0%
110.4%
166.6%
101.5%
Gain on disposition of real estate
84.7%
15.6%
77.0%
7.9%
Operating income
17.7%
5.2%
10.4%
6.4%
Equity income from unconsolidated subsidiaries
49.8%
23.2%
17.1%
6.1%
Other income
1.0%
-
0.0%
0.3%
-
0.0%
Add-back: Depreciation and amortization
2.5%
0.9%
3.0%
1.2%
Adjustments:
Carried interest incentive compensation expense to
align with the timing of associated revenue
5.9%
1.4%
0.3%
1.5%
Net results related to the wind-down of certain
businesses (2)
2.5%
3.8%
4.9%
3.3%
Costs associated with efficiency and cost-reduction
initiatives
-
0.0%
-
0.0%
-
0.0%
0.2%
Integration and other costs related to acquisitions
2.5%
-
0.0%
0.8%
-
0.0%
Provision associated with Telford's fire safety
remediation efforts
-
0.0%
-
0.0%
28.2%
-
0.0%
Segment operating profit
$166
$73
$388
$123
________________________________________________________________________________________________________________________________________
(1)Calculated as a percentage of total segment revenue.
(2)Management made the decision to wind down the legacy Telford Homes' construction self-delivery business.
Three Months Ended September 30, 2026 Compared to the Three Months Ended September 30, 2025
Revenue decreased 3.8% for the current quarter primarily due to lower fees from development services, partially offset
by increased investment management revenue. Foreign currency translation had a 1.0% negative impact on total revenue during
the quarter primarily driven by weakness in the Japanese yen.
Cost of revenue decreased 92.3% 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 negligible impact on
total cost of revenue during the quarter.
Operating, administrative and other expenses increased 72.4% primarily due to higher total compensation expense in
the development services line of business, an increase in total compensation in our investment management line of business,
and higher impairment losses. Foreign currency translation had a 0.5% positive impact on total operating expenses.
Gain on disposition of real estate increased by $139 million compared with third quarter 2025, due to higher
monetization of real estate development assets in the current period versus lower sales in the prior year quarter.
We recorded equity income from unconsolidated subsidiaries of approximately $101 million versus equity income of
$49 million during the same period in 2025 primarily due to monetization of real estate development assets in the current
period.
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Below is a rollforward of our assets under management (AUM) by product type for the three months ended
September 30, 2026 (dollars in billions):
Funds
Separate Accounts
Securities
Total
Balance at June 30, 2026
$69.6
$73.9
$11.3
$154.8
Inflows
1.3
2.5
0.2
4.0
Outflows
(2.0)
(1.9)
(0.3)
(4.2)
Market appreciation (depreciation)
1.4
0.3
(0.8)
0.9
Balance at September 30, 2026
$70.3
$74.8
$10.4
$155.5
AUM generally refers to the properties and other assets to which we provide (or participate in) oversight, investment
management services and other advice, and which generally consist of real estate properties or loans, securities portfolios and
investments in operating companies and joint ventures. Our AUM is intended principally to reflect the extent of our presence in
the real estate market, not to be the basis for determining our management fees. Our assets under management consist of:
•the total fair market value of the real estate properties and other assets either wholly-owned or held by joint
ventures and other entities in which our sponsored funds or investment vehicles and client accounts have invested
or to which they have provided financing. Committed (but unfunded) capital from investors in our sponsored
funds is not included in this component of our AUM. The value of development properties is included at estimated
completion cost. In the case of real estate operating companies, the total value of real properties controlled by the
companies, generally through joint ventures, is included in AUM; and
•the net asset value of our managed securities portfolios, including investments (which may be comprised of
committed but uncalled capital) in private real estate funds under our fund of funds investments.
Our calculation of AUM may differ from the calculations of other asset managers, and as a result, this measure may
not be comparable to similar measures presented by other asset managers.
Nine Months Ended September 30, 2026 Compared to the Nine Months Ended September 30, 2025
Revenue decreased 9.7% for the nine months ended September 30, 2026 primarily due to lower management fees from
development services partially offset by increased investment management revenue. Foreign currency translation had a 1.8%
positive impact on total revenue during the nine months ended September 30, 2026, primarily driven by strength in the euro and
British pound sterling partially offset by weakness in the Japanese yen.
Cost of revenue decreased 63.6% for the nine months ended September 30, 2026 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 1.7% negative impact on total cost of revenue during the nine months ended September 30, 2026.
Operating, administrative and other expenses increased 72.0%, primarily due to an increase in the provision related to
fire safety remediation efforts for buildings historically developed by our subsidiary, Telford Homes (see Note 17 - Telford
Fire Safety Remediation), an increase in total compensation in our development services lines of business resulting from an
increase in development sales, and higher impairment losses during the nine months ended September 30, 2026. Foreign
currency translation had a 1.6% negative impact on total operating expenses.
Gain on disposition of real estate increased by $406 million compared to the same period in 2025 due to higher
monetization of real estate development assets in 2026.
We recorded equity income from unconsolidated subsidiaries of approximately $102 million versus equity income of
$40 million during the same period in 2025 due to higher monetization of real estate development assets in the current period.
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Below is a rollforward of our assets under management (AUM) by product type for the nine months ended
September 30, 2026 (dollars in billions):
Funds
Separate Accounts
Securities
Total
Balance at December 31, 2025
$68.9
$75.8
$10.8
$155.5
Inflows
3.5
5.0
0.9
9.4
Outflows
(3.3)
(6.2)
(1.4)
(10.9)
Market appreciation
1.2
0.2
0.1
1.5
Balance at September 30, 2026
$70.3
$74.8
$10.4
$155.5
We describe above how we calculate AUM. As noted above, our calculation of AUM may differ from the calculations
of other asset managers, and as a result, this measure may not be comparable to similar measures presented by other asset
managers.
Corporate and Other
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 Corporate and other segment for the three
and nine months ended September 30, 2026 and 2025 (dollars in millions):
Three Months Ended September 30, (1)
Nine Months Ended September 30, (1)
2026
2025
2026
2025
Elimination of inter-segment revenue
$(18)
$(9)
$(47)
$(20)
Costs and expenses:
Cost of revenue (2)
(1)
(1)
(5)
-
Operating, administrative and other
Depreciation and amortization
Total costs and expenses
Gain on disposition of real estate (2)
Operating loss
(226)
(205)
(663)
(614)
Equity (loss) income from unconsolidated subsidiaries
(1)
(4)
Other loss
(1)
-
(2)
(1)
Add-back: Depreciation and amortization
Adjustments:
Integration and other costs related to acquisitions
Charges related to indirect tax audits and settlements
-
-
-
(1)
Business and finance transformation
Costs associated with efficiency and cost-reduction initiatives
-
-
Segment operating loss
$(152)
$(134)
$(434)
$(356)
________________________________________________________________________________________________________________________________________
(1)Percentage of revenue calculations are not meaningful and therefore not included.
(2)Primarily relates to inter-segment eliminations.
Three Months Ended September 30, 2026 Compared to the Three Months Ended September 30, 2025
Core Corporate
Operating, administrative and other expenses for our core corporate functions rose 10.4% to $201 million for the third
quarter of 2026, mainly due to higher management incentive compensation related to our strong performance.
Other (Non-core)
We recorded equity loss of $1 million in the third quarter of 2026. This compares with $1 million of equity income in
the third quarter of 2025.
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Nine Months Ended September 30, 2026 Compared to the Nine Months Ended September 30, 2025
Core Corporate
Operating, administrative and other expenses for our core corporate functions rose 12.0% to $607 million for the nine
months ended September 30, 2026, mainly due to higher management incentive compensation related to our strong
performance.
Other (Non-core)
We recorded equity loss of $4 million in the nine months ended September 30, 2026, due to a fair value adjustment
related to our equity investments. This compares with equity income of $24 million recognized during the same period in 2025,
primarily reflecting the higher value of our investment in Altus, which was sold in the second quarter of 2025.
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Liquidity and Capital Resources
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 approximately $500 million of anticipated capital expenditures, net of tenant concessions.
During the nine months ended September 30, 2026, we incurred $321 million of capital expenditures. As of September 30,
2026, we had aggregate future commitments of $172 million related to co-investment funds in our REI segment, approximately
$13 million of which is expected to be funded in 2026. Additionally, as of September 30, 2026, we are committed to fund
additional capital of $16 million and $68 million to consolidated and unconsolidated projects, respectively, within our REI
segment. As of September 30, 2026, we had $3.3 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 $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 September 30, 2026
and December 31, 2025, we had $1.2 billion and $852 million, respectively, in outstanding borrowings under the commercial
paper program.
We have historically relied on our internally generated cash flow, our revolving credit facilities and commercial paper
program to fund our working capital, capital expenditures, share repurchases, 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 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.
On May 4, 2026, we issued $750 million in aggregate principal amount of 5.250% senior notes due 2036, generating
aggregate net proceeds of approximately $735 million, after offering expenses. We used the net proceeds from this offering to
repay borrowings under our commercial paper program.
As noted above, we believe that any future significant acquisitions we may make could require us to obtain additional
debt or equity financing. In the past, we have been able to obtain such financing for material transactions on terms that we
believed to be reasonable. However, it is possible that we may not be able to obtain acquisition financing on favorable terms, or
at all, in the future.
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.
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, 2026 and December 31, 2025, we had
accrued deferred purchase consideration totaling $229 million ($122 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 liabilities in the accompanying consolidated balance sheets set forth in Item 1 of this Quarterly Report.
Lastly, as described in Note 14 - Income Per Share and Stockholders' Equity of the Notes to Consolidated Financial
Statements (Unaudited) set forth in Item 1 of this Quarterly Report, in November 2024, our Board of Directors (Board)
authorized an additional $5.0 billion to our existing $4.0 billion share repurchase program (as amended, the 2024 program)
bringing the total authorized amount under the 2024 program to $9.0 billion as of September 30, 2026. The Board also extended
the term of the 2024 program through December 31, 2029.
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During the three months ended September 30, 2026, we repurchased 1,521,085 shares of our common stock with an
average price of $142.74 per share for an aggregate of $217 million under the 2024 program. During the nine months ended
September 30, 2026, we repurchased 8,199,713 shares of our common stock with an average price of $141.77 per share for an
aggregate of $1.2 billion under the 2024 program. During the period from October 1, 2026 through October 20, 2026, we
repurchased 198,865 shares of our common stock with an average price of $130.12 per share for an aggregate of $26 million.
As of both September 30, 2026 and October 20, 2026, we had $3.7 billion of capacity remaining under the 2024 program.
These stock repurchases were funded with cash on hand and proceeds from our commercial paper program.
We may utilize our stock repurchase programs to continue offsetting the impact of our stock-based compensation
program and on a more opportunistic basis if we believe our stock presents a compelling investment compared to other
discretionary uses. The timing of any future repurchases and the actual amounts repurchased will depend on a variety of factors,
including the market price of our common stock, general market and economic conditions and other factors.
Historical Cash Flows
Operating Activities
Net cash provided by operating activities totaled $182 million for the nine months ended September 30, 2026 as
compared to net cash provided by operating activities of $338 million during the nine months ended September 30, 2025. The
decrease in net cash provided by operating activities was driven by net outflows associated with working capital movements,
largely from higher accounts receivable due to revenue growth and the timing of cash collections.
Investing Activities
Net cash used in investing activities totaled $364 million for the nine months ended September 30, 2026 as compared
to net cash used in investing activities of $664 million during the nine months ended September 30, 2025. The decrease in net
cash used in investing activities for the nine months ended September 30, 2026 was driven by proceeds from the disposition of
real estate assets, offset by cash paid for the acquisition and development of real estate and capital expenditures. In addition, net
cash used in investing activities was higher in the prior year, due to the acquisition of Industrious in the first quarter 2025.
Financing Activities
Net cash used in financing activities totaled $22 million for the nine months ended September 30, 2026 as compared to
net cash provided by financing activities of $832 million for the nine months ended September 30, 2025. The change was due to
lower net proceeds from the issuance of commercial paper and long-term debt, and higher cash outflows to repurchase common
stock.
Indebtedness
We use a variety of financing arrangements, both long-term and short-term, to fund our operations in addition to cash
generated from operating activities. We also use several funding sources to avoid becoming overly dependent on one financing
source, and to lower funding costs.
Long-Term Debt
On July 10, 2023, CBRE Group, Inc. (CBRE Group), CBRE Services, Inc. (CBRE Services) and Relam Amsterdam
Holdings B.V., a wholly-owned subsidiary of CBRE Services (Relam Borrower), entered into a 5-year senior unsecured Credit
Agreement (2023 Credit Agreement) maturing on July 10, 2028. The 2023 Credit Agreement provides for a senior unsecured
term loan credit facility comprised of (i) tranche A Euro-denominated term loans in an aggregate principal amount of
€367 million (Tranche A (Euro) Loans) and (ii) tranche A U.S. Dollar-denominated term loans in an aggregate principal
amount of $350 million (Tranche A (USD) Loans) with a weighted-average interest rate of 4.1% as of September 30, 2026,
both requiring quarterly principal payments through maturity on July 10, 2028.
On March 13, 2025, CBRE Group, CBRE Services and Relam Borrower entered into Amendment No. 1 to the 2023
Credit Agreement, which provided for, among other things, the ability of Relam Borrower to obtain incremental commitments
and loans under the 2023 Credit Agreement in an aggregate principal amount of $750 million (or the Euro equivalent). On
March 14, 2025, CBRE Group, CBRE Services and Relam Borrower entered into Amendment No. 2 and Incremental
Assumption Agreement to the 2023 Credit Agreement, pursuant to which Relam Borrower incurred incremental term loans (i)
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denominated in Euros in the aggregate principal amount of €425 million (Incremental Euro Term Loans) and (ii) denominated
in U.S. Dollars in the aggregate principal amount of $125 million (Incremental USD Term Loans).
The term loan borrowings under the 2023 Credit Agreement are fully and unconditionally guaranteed on a senior basis
by CBRE Group and CBRE Services. The 2023 Credit Agreement, including the amendments thereto, is described in Note 10 -
Long-Term Debt and Short-Term Borrowings of the Notes to Consolidated Financial Statements (Unaudited) set forth in Item 1
of this Quarterly Report, and such description is incorporated by reference herein.
CBRE Services has issued and outstanding the following notes (dollars in millions):
Series
Aggregate Principal
Amount
5.500% senior notes due April 1, 2029
$500
4.800% senior notes due June 15, 2030
2.500% senior notes due April 1, 2031
4.900% senior notes due January 15, 2033
5.950% senior notes due August 15, 2034
1,000
5.500% senior notes due June 15, 2035
5.250% senior notes due June 1, 2036
Each series of our outstanding senior notes described above are unsecured obligations of CBRE Services with semi-
annual interest payable through maturity and are fully and unconditionally guaranteed on a senior basis by CBRE Group. The
indentures governing such notes contain restrictive covenants that, among other things, limit our ability to create or permit liens
on assets securing indebtedness, enter into sale/leaseback transactions and enter into consolidations or mergers. The
descriptions of our outstanding senior notes in Note 10 - Long-Term Debt and Short-Term Borrowings of the Notes to
Consolidated Financial Statements (Unaudited) are set forth in Item 1 of this Quarterly Report and are incorporated by
reference herein.
Combined summarized financial information for CBRE Group (parent) and CBRE Services (subsidiary issuer) is as
follows (dollars in millions):
September 30, 2026
December 31, 2025
Balance Sheet Data:
Current assets
$212
$61
Non-current assets
1,751
1,755
Total assets
$1,963
$1,816
Current liabilities
$1,284
$908
Non-current liabilities (1)
12,322
12,364
Total liabilities (1)
$13,606
$13,272
Nine Months Ended
September 30,
2026
2025
Statement of Operations Data:
Revenue
$-
$-
Operating loss
(2)
(4)
Net loss
(368)
(305)
________________________________________________________________________________________________________________________________________
(1)Includes $7.5 billion and $8.3 billion of intercompany loan payables to non-guarantor subsidiaries as of September 30, 2026 and December 31, 2025,
respectively. All intercompany balances and transactions between CBRE Group and CBRE Services have been eliminated.
For additional information on all of our long-term debt, see Note 12 - Long-Term Debt and Short-Term Borrowings of
the Notes to Consolidated Financial Statements set forth in Item 8 included in our 2025 Annual Report and Note 10 - Long-
Term Debt and Short-Term Borrowings of the Notes to Consolidated Financial Statements (Unaudited) set forth in Item 1 of
this Quarterly Report.
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Short-Term Borrowings
On June 24, 2025, we entered into a 5-year senior unsecured Revolving Credit Agreement (the 5-Year Revolving
Credit Agreement). The 5-Year Revolving Credit Agreement provides for a senior unsecured revolving credit facility available
to CBRE Services with commitments in an aggregate principal amount of up to $3.5 billion and a maturity date of June 24,
2030.
In addition, the 5-Year Revolving Credit Agreement also includes capacity for letters of credit not to exceed
$300 million in the aggregate and capacity for swingline loans not to exceed $300 million in the aggregate. The 5-Year
Revolving Credit Agreement is fully and unconditionally guaranteed by CBRE Group.
As of September 30, 2026, no amount was outstanding under the revolving credit facility provided for by the 5-Year
Revolving Credit Agreement. $23 million of letters of credit were outstanding as of September 30, 2026. Letters of credit are
issued in the ordinary course of business and would reduce the amount we may borrow under this revolving credit facility. As
of December 31, 2025, no amount was outstanding under this revolving credit facility. $17 million of letters of credit were
outstanding as of December 31, 2025.
On June 23, 2026, we entered into a new 364-day senior unsecured Revolving Credit Agreement (the 364-Day
Revolving Credit Agreement, and together with the 5-Year Revolving Credit Agreement, the Revolving Credit Agreements),
which replaced our prior 364-day revolving credit agreement dated June 24, 2025. The 364-Day Revolving Credit Agreement
provides for a senior unsecured revolving credit facility available to CBRE Services with commitments in an aggregate
principal amount of up to $1.0 billion and a maturity date of June 22, 2027.
The 364-Day Revolving Credit Agreement requires us to pay a fee based on the total amount of the revolving credit
facility commitment (whether used or unused). The 364-Day Revolving Credit Agreement is fully and unconditionally
guaranteed by CBRE Group.
As of both September 30, 2026 and December 31, 2025, no amount was outstanding under the revolving credit facility
provided for by the 364-Day Revolving Credit Agreement.
On December 2, 2024, CBRE Services established a commercial paper program pursuant to which we may issue and
sell up to $3.5 billion of short-term, unsecured and unsubordinated commercial paper notes with up to 397-day maturities.
Amounts available under the program may be borrowed, repaid and re-borrowed from time to time. Payment of the commercial
paper notes is guaranteed on an unsecured and unsubordinated basis by CBRE Group. The proceeds from issuances under the
program may be used for general corporate purposes. The company intends 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, 2026, we had $1.2 billion in outstanding borrowings under the commercial paper program with a
weighted-average annual interest rate of 4.09%. As of October 20, 2026 and December 31, 2025, we had $910 million and
$852 million, respectively, in outstanding borrowings under the commercial paper program.
We also maintain warehouse lines of credit with certain third-party lenders. See Note 4 - Warehouse Receivables &
Warehouse Lines of Credit of the Notes to Consolidated Financial Statements (Unaudited) set forth in Item 1 of this Quarterly
Report.
For additional information on all of our short-term borrowings, see Note 5 - Warehouse Receivables & Warehouse
Lines of Credit and Note 12 - Long-Term Debt and Short-Term Borrowings of the Notes to Consolidated Financial Statements
set forth in Item 8 included in our 2025 Annual Report and Note 4 - Warehouse Receivables & Warehouse Lines of Credit and
Note 10 - Long-Term Debt and Short-Term Borrowings of the Notes to Consolidated Financial Statements (Unaudited) set
forth in Item 1 of this Quarterly Report.
Off -Balance Sheet Arrangements
We do not have off-balance sheet arrangements that we believe could have a material current or future impact on our
financial condition, liquidity or results of operations. Our off-balance sheet arrangements are described in Note 12 -
Commitments and Contingencies of the Notes to Consolidated Financial Statements (Unaudited) set forth in Item 1 of this
Quarterly Report and are incorporated by reference herein.
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Critical Accounting Policies and Estimates
Our consolidated financial statements have been prepared in accordance with accounting principles generally accepted
in the United States, or GAAP, which require us to make estimates and assumptions that affect reported amounts. The estimates
and assumptions are based on historical experience and on other factors that we believe to be reasonable. Actual results may
differ from those estimates. We believe that the following critical accounting policies represent the areas where more significant
judgments and estimates are used in the preparation of our consolidated financial statements. A discussion of such critical
accounting policies, which include revenue recognition, business combinations, goodwill and other intangible assets, income
taxes, and contingencies can be found in our 2025 Annual Report. There have been no material changes to these policies and
estimates as of September 30, 2026.
New Accounting Pronouncements
See Note 2 - New Accounting Pronouncements of the Notes to Consolidated Financial Statements (Unaudited) set
forth in Item 1 of this Quarterly Report.
Non-GAAP Financial Measures
Core EBITDA is not a recognized measurement under accounting principles generally accepted in the United States, or
U.S. GAAP. When analyzing our operating performance, investors should use this measure in addition to, and not as an
alternative for, their most directly comparable financial measure calculated and presented in accordance with U.S. GAAP. We
generally use this non-GAAP financial measure to evaluate operating performance and for other discretionary purposes. We
believe this measure provides a more complete understanding of ongoing operations, enhances 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 costs and charges that may obscure the underlying performance of our business and related trends. Because not all
companies use identical calculations, our presentation of core EBITDA may not be comparable to similarly titled measures of
other companies.
We use core EBITDA as an indicator of the company's operating financial performance. Core EBITDA represents
earnings before the portion attributable to non-controlling interests, depreciation and amortization, asset impairments, net
interest expense, write-off of financing costs on extinguished debt, income taxes, further adjusted for the following items (Other
adjustments):
•net non-cash mortgage servicing rights,
•integration and other costs related to acquisitions,
•carried interest incentive compensation expense to align with the timing of associated revenue,
•charges related to indirect tax audits and settlements,
•net results related to the wind-down of certain businesses,
•impact of fair value non-cash adjustments related to unconsolidated equity investments,
•costs associated with business and finance transformation,
•costs associated with efficiency and cost-reduction initiatives,
•provision associated with Telford's fire safety remediation efforts, and
•net fair value adjustments on strategic non-core investments.
We believe that investors may find this measure useful in evaluating our operating performance compared to that of
other companies in our industry because their calculations generally eliminate the effects of acquisitions, which would include
impairment charges of goodwill and intangibles created from acquisitions, the effects of financings, income taxes and the
accounting effects of capital spending.
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Core EBITDA is not intended to be a measure of free cash flow for our discretionary use because they do not consider
certain cash requirements such as tax and debt service payments. This measure may also differ from the amounts calculated
under similarly titled definitions in our credit facilities and debt instruments, which 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. We also use core EBITDA as a significant component when
measuring our operating performance under our employee incentive compensation programs.
Core EBITDA is calculated as follows (dollars in millions):
Three Months Ended September 30,
Nine Months Ended September 30,
2026
2025
2026
2025
Net income attributable to CBRE Group, Inc.
$443
$363
$965
$741
Net income attributable to non-controlling interests
Net income
1,069
Adjustments:
Depreciation and amortization
Interest expense, net of interest income
Write-off of financing costs on extinguished debt
-
-
-
Provision for income taxes
Net non-cash mortgage servicing rights
(5)
Integration and other costs related to acquisitions
Carried interest incentive compensation expense to align with the timing
of associated revenue
Charges related to indirect tax audits and settlements
-
-
-
(1)
Net results related to the wind-down of certain businesses (1)
Impact of fair value non-cash adjustments related to unconsolidated
equity investments
-
-
-
Business and finance transformation
Costs associated with efficiency and cost-reduction initiatives
-
-
Provision associated with Telford's fire safety remediation efforts
-
-
-
Net fair value adjustments on strategic non-core investments
-
(22)
Core EBITDA
$1,001
$779
$2,668
$1,923
________________________________________________________________________________________________________________________________________
(1)Management made the decision to wind down the legacy Telford Homes' construction self-delivery business and certain businesses within the BOE
segment.
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Cautionary Note on Forward-Looking Statements
This Quarterly Report contains forward-looking statements within the meaning of Section 27A of the Securities Act of
1933, as amended, or the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange
Act. The words "anticipate," "believe," "could," "should," "propose," "continue," "estimate," "expect," "intend," "may,"
"plan," "predict," "project," "will," "forecast," "target," and similar terms and phrases are used in this Quarterly Report to
identify forward-looking statements. Except for historical information contained herein, the matters addressed in this Quarterly
Report are forward-looking statements. These statements relate to analyses and other information based on forecasts of future
results and estimates of amounts not yet determinable. These statements also relate to our future prospects, developments and
business strategies.
These forward-looking statements are made based on our management's expectations and beliefs concerning future
events affecting us and are subject to uncertainties and factors relating to our operations and business environment, all of which
are difficult to predict and many of which are beyond our control. These uncertainties and factors could cause our actual results
to differ materially from those matters expressed in or implied by these forward-looking statements.
The following factors are among those, but are not only those, that may cause actual results to differ materially from
the forward-looking statements:
•disruptions in general economic, political and regulatory conditions and significant public health events,
particularly in geographies or industry sectors where our business may be concentrated;
•volatility or adverse developments in the securities, capital or credit markets, interest rate increases and conditions
affecting the value of real estate assets, inside and outside the U.S.;
•poor performance of real estate investments or other conditions that negatively impact clients' willingness to make
real estate or long-term contractual commitments;
•cost and availability of capital for investment in real estate;
•foreign currency fluctuations and changes in currency restrictions, trade sanctions and import/export and transfer
pricing rules;
•our ability to compete globally, or in specific geographic markets or business segments that are material to us;
•our ability to identify, acquire and integrate accretive businesses;
•costs and potential future capital requirements relating to businesses we may acquire;
•integration challenges arising out of companies we may acquire;
•increases in unemployment and general slowdowns in economic or commercial activity;
•trends in pricing and risk assumption for commercial real estate services;
•the effect of significant changes in supply/demand and capitalization rates across different property types;
•a reduction by companies in their reliance on outsourcing for their commercial real estate needs, which would
affect our revenues and operating performance;
•client actions to restrain project spending and reduce outsourced staffing levels;
•our ability to further diversify our revenue model to offset cyclical economic trends in the commercial real estate
industry;
•our ability to attract new occupier and investor clients;
•our ability to retain major clients and renew related contracts;
•our ability to leverage our global services platform to maximize and sustain long-term cash flow;
•our ability to continue investing in our platform and client service offerings;
•our ability to maintain expense discipline;
•the emergence of disruptive business models and technologies;
•negative publicity or harm to our brand and reputation;
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•the failure by third parties to comply with service level agreements or regulatory or legal requirements;
•the ability of our investment management business to maintain and grow assets under management and achieve
desired investment returns for our investors, and any potential related litigation, liabilities or reputational harm
possible if we fail to do so;
•our ability to manage fluctuations in net earnings and cash flow, which could result from poor performance in our
investment programs, including our participation as a principal in real estate investments;
•the ability of our indirect wholly owned subsidiary CBRE Capital Markets, Inc. (CBRE Capital Markets) to
periodically amend, or replace, on satisfactory terms, the agreements for its warehouse lines of credit;
•declines in lending activity of U.S. Government Sponsored Enterprises, regulatory oversight of such activity and
our loan servicing revenue from the commercial real estate mortgage market;
•changes in U.S. and international law and regulatory environments (including relating to anti-corruption, anti-
money laundering, trade sanctions, tariffs, currency controls and other trade control laws), particularly in Asia,
Africa, Russia, Eastern Europe and the Middle East, due to the level of political instability in those regions;
•litigation and its financial and reputational risks to us;
•our exposure to liabilities in connection with real estate advisory and property management activities and our
ability to procure sufficient insurance coverage on acceptable terms;
•our ability to retain, attract and incentivize key personnel;
•our ability to manage organizational challenges associated with our size;
•liabilities under guarantees, or for construction defects, that we incur in our development services business;
•our leverage under our debt instruments as well as the limited restrictions therein on our ability to incur additional
debt, and the potential increased borrowing costs to us from a credit-rating downgrade;
•our and our employees' ability to execute on, and adapt to, information technology strategies and trends;
•cybersecurity threats or other threats to our information technology networks, including the potential
misappropriation of assets or sensitive information, corruption of data or operational disruption;
•our ability to comply with laws and regulations related to our global operations, including real estate licensure,
tax, labor and employment laws and regulations, fire and safety building requirements and regulations, as well as
data privacy and protection regulations, sustainability matters, and the anti-corruption laws and trade sanctions of
the U.S. and other countries;
•changes in applicable tax or accounting requirements;
•any inability for us to implement and maintain effective internal controls over financial reporting;
•the effect of implementation of new accounting rules and standards or the impairment of our goodwill and
intangible assets;
•the performance of our equity investments in companies we do not control; and
•the other factors described elsewhere in this Quarterly Report on Form 10-Q, included under the headings
"Management's Discussion and Analysis of Financial Condition and Results of Operations-Critical Accounting
Policies and Estimates," "Quantitative and Qualitative Disclosures About Market Risk" and Part II, Item 1A,
"Risk Factors" or as described in our 2025 Annual Report, in particular in Part I, Item 1A "Risk Factors", or as
described in the other documents and reports we file with the Securities and Exchange Commission (SEC).
Forward-looking statements speak only as of the date the statements are made. You should not put undue reliance on
any forward-looking statements. We assume no obligation to update forward-looking statements to reflect actual results,
changes in assumptions or changes in other factors affecting forward-looking information, except to the extent required by
applicable securities laws. If we do update one or more forward-looking statements, no inference should be drawn that we will
make additional updates with respect to those or other forward-looking statements. Additional information concerning these and
other risks and uncertainties is contained in our other periodic filings with the SEC.
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Investors and others should note that we routinely announce financial and other material information using our
Investor Relations website (https://ir.cbre.com), SEC filings, press releases, public conference calls and webcasts. We use these
channels of distribution to communicate with our investors and members of the public about our company, our services and
other items of interest. Information contained on our website is not part of this Quarterly Report or our other filings with the
SEC.
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CBRE Group Inc. published this content on October 22, 2026, and is solely responsible for the information contained herein. Distributed via EDGAR on October 22, 2026 at 20:42 UTC. If you believe the information included in the content is inaccurate or outdated and requires editing or removal, please contact us at [email protected]