Commercial property firm CBRE Group saw a sharp increase in second-quarter (Q2) revenue driven by solid growth across its global businesses.
Dallas-based CBRE Group reported $7.8 billion in revenues, a more than 20% increase from the previous quarter. CBRE President and CEO Bob Sulentic attributes the company’s progress to leasing, management, and development growth.
“All three business segments posted double-digit revenue and segment-operating profit growth, despite the significant currency headwinds that affected all U.S.-based global companies,” Sulentic said in the financial statement. He attributed the results to a “diversification strategy and an economic backdrop that was still generally supportive despite heightened macro concerns.”
In addition to solid revenue growth, CBRE Group reported $487.3 million in net income, a 10% increase year-over-year. The company’s core adjusted net income— the highest core earnings per share for any quarter in the company’s history— rose 33% in Q2 2022 and was up 37% from Q2 2021.
Lastly, global property leasing revenue rose 40% from Q2 of 2021, and sales revenue for retail, industrial, and multifamily properties rose 17% year-over-year.
Although the company’s profits have sprung back from pandemic lows, current economic uncertainty caused CBRE executives to prepare the company for the possibility of a recession. The company’s baseline assumption is that the U.S. will enter a recession in Q4.
Emma Giamartino, CBRE’s chief financial officer, said even though the company saw much less market uncertainty than during the pandemic, it had begun taking steps to ensure its bottom line.
For example, CBRE Group limited new hires and development activity, as well as cut operating costs and building project starts, according to Giamartino.
Even though the company has taken actionable steps to be proactive during economic uncertainty, CBRE Group claimed it was well positioned to face a downturn.
“A larger portion of our revenue and profits are generated from businesses that have performed particularly well through downturns,” said Sulentic. “Macro uncertainty creates ripe conditions for market share gains.”