CBRE is preparing deeper cost cuts right across its business as the real estate downturn continues.
In a call to discuss the agency’s third-quarter results, chief financial officer Emma Giamartino said the team had made clear earlier in the year that “if the market environment deteriorated”, it would cut costs further than previously announced.
“That time has come, and we will be reducing costs across our lines of business,” Giamartino added. “We have already targeted $150m (£124m) of reductions in our run rate operating costs, primarily focused on our transactional lines of business that have been most negatively impacted by the market downturn. We expect to provide more detail on the benefit of our cost savings actions when we provide 2024 guidance next quarter.”
Almost a year ago, CBRE confirmed $400m of cuts, mostly from job losses.
CBRE’s third-quarter revenue was largely flat, with growth in the workspace solutions and facilities management divisions offsetting falls in capital markets and advisory.
Chief executive Bob Sulentic said the agency now expects the bottom of the market “is unlikely to occur until the second half of next year at the earliest”.
“In the meantime, as we discussed last quarter, pockets of opportunity exist and the breadth and depth of our market presence gives us visibility into where we want to be positioned for the long-term,” he added, pointing to investment in value-add and development activity.
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