CBRE has agreed a deal to buy the Global WorkPlace Solutions business of Johnson Controls for $1.5bn (£1bn).
The cash deal will expand the advisory firm’s facilities management business dramatically and take its revenue from contractual sources to 49%, or $4.3bn, up from 21%, or $798m, in 2006.
In a presentation to analysts when the deal was announced on Tuesday, the company said: “Facilities management has been CBRE’s fastest-growing and most stable line of business.”
The deal is expected to close late in the third quarter or early in the fourth quarter of this year. The business has been bought on an eight-times-revenue multiple.
GWS manages 1.2bn sq ft of space worldwide, 45% of which is in EMEA, 30% in the Americas and 25% in Asia Pacific. It employs 16,000 staff.
Combined, the two businesses now manage 5bn sq ft of property, 24% of which is in EMEA, 46% is in the Americas and 28% is in Asia Pacific.
As part of the deal, CBRE will provide Johnson Controls corporate real estate services on its own 50m sq ft estate.
The companies will also be jointly funding an innovation lab to develop energy management solutions.
The deal follows CBRE’s acquisition of engineering services company Norland Managed Solutions in December 2013 for £265.5m.
Norland performs technical engineering services on commercial buildings.
