CBRE Group (NYSE:CBRE) reported what executives described as a strong finish to 2025, posting record fourth-quarter revenue and core earnings per share as both its resilient and transactional businesses delivered double-digit growth. On the company’s fourth quarter 2025 earnings call, Chair and CEO Bob Sulentic said revenue and core EPS “reached their highest levels ever for CBRE,” citing broad-based strength across sales and leasing in the U.S. and many international markets, alongside continued momentum in recurring service lines.
Fourth-quarter results driven by leasing, sales and resilient services
Chief Financial Officer Emma Giamartino said fourth-quarter revenue increased 12%, core EBITDA rose 19%, and core EPS increased 18%. She highlighted “continued double-digit growth” in both leasing and sales within advisory services, with leasing revenue up 14% globally. EMEA led leasing growth, with Continental Europe up 29% and the U.K. up 16%.
Capital markets activity also improved, with both sales and commercial mortgage originations growing at “high teens” rates. In the U.S., sales revenue rose 27%, driven by office and multifamily, though management noted revenue in both asset classes remains well below prior peak levels. Mortgage origination fees grew more than 20%, supported by a 23% increase in loan volume led by activity with debt funds and CMBS.
Data center and digital infrastructure emphasized as a key growth driver
Sulentic pointed to strategic investments aligned with secular tailwinds, including the November acquisition of Pearce Services to expand technical services capabilities in digital infrastructure. He also highlighted CBRE’s integrated “data center solutions” offering, which spans services tied to a data center’s technical infrastructure (“white space”), building operating systems (“gray space”), and traditional facilities management.
Management said revenue from the data center solutions business is expected to reach $2 billion in 2026 and is growing at about 20% per year. Across the company, data center and digital infrastructure work within its four business segments accounted for approximately 14% of core EBITDA in 2025.
In Q&A, Sulentic said the company is not a material owner of data centers, and therefore does not view potential “bubble” risk in data center ownership as a major exposure. He said the company has “very, very little balance sheet investment” supporting its data center land business within Trammell Crow Company, while describing it as a “nice add” to profitability. He also emphasized demand visibility, saying that based on current pipeline and project duration, the opportunity “is gonna go on for a few years,” and that staffing to meet demand is a major focus.
Segment updates: BOE, project management, and real estate investments
In the building operations and experience (BOE) segment, Giamartino said revenue growth was driven by local facilities management, data center solutions, and Pearce Services contributions. Data center solutions revenue grew more than 20%, while local facilities management delivered mid-teens growth, led by expansion in the Americas and strength in Western Europe. BOE segment operating profit increased 20% and outpaced revenue growth.
On margins, Giamartino said BOE margins expanded more than expected in 2025 following efficiency initiatives, but she expects BOE margins to be flat in 2026 as operating leverage is offset by planned investments to sustain above-historical growth. She added that beyond 2026, the company expects continued incremental margin expansion as investments mature.
Project management posted “solid revenue growth,” supported by new hyperscaler real estate projects in the U.S. and U.K. public sector infrastructure mandates. Management said the Turner & Townsend integration is largely operating as a combined business globally. Giamartino said fourth-quarter margins declined due to a few “unusual one-time expenses,” and later clarified the company took a conservative view on receivables on some large projects, which it now expects to reverse in the first quarter, driving margin expansion. For 2026, she said the company expects low-teens SOP growth and “some margin expansion.”
In real estate investments, Giamartino said SOP growth was driven by the sale of data center sites and the development business, and that CBRE has about $900 million of embedded gains in its development portfolio. Investment management operating profit was largely in line with expectations, with growth in recurring asset management fees offset by lower incentive fees and co-investment returns versus the prior year. The company raised more than $11 billion in capital in 2025, and AUM ended the year at $155 billion, up more than $9 billion.
GAAP items, cash flow, and capital allocation
Giamartino noted two items that reduced fourth-quarter GAAP earnings: a non-cash impact from the buyout of the company’s U.K. pension plan (which management said will result in future net cash savings), and an increased reserve for fire safety remediation in the U.K. development business. Together, those items totaled $279 million. Without them, she said fourth-quarter GAAP net income would have increased 43%.
CBRE generated nearly $1.7 billion of free cash flow in 2025, reflecting 86% conversion on core net income, slightly above its 75% to 85% target range. Since the end of the third quarter, the company allocated more than $1.5 billion of capital, including about $1.2 billion for the Pearce Services acquisition and nearly $400 million for share repurchases. Share repurchases totaled more than $1 billion since the beginning of 2025, and net leverage ended the year at 1.2 turns.
In discussing 2025 free cash flow versus a prior expectation, Giamartino attributed a timing difference to onboarding large enterprise clients, which impacted working capital and is expected to reverse into 2026. She also said 2026 will face a headwind from cash compensation tied to strong 2025 performance, especially in development.
On capital allocation, management said it continues to evaluate a “strong pipeline” of potential acquisitions across data centers, facilities management, investment management, and infrastructure/project management, while also balancing share repurchases. Sulentic said the company’s goal is “to at least deploy the level of free cash flow” expected to be generated annually, and that given free cash flow levels, buybacks are likely to continue alongside selective M&A.
2026 outlook: core EPS growth and early-year momentum
CBRE guided to 2026 core EPS of $7.30 to $7.60, representing 17% growth at the midpoint. Management said the outlook is driven by continued double-digit revenue growth in resilient businesses and “greater than through cycle” growth in transactional businesses.
- Advisory: Low-teens SOP growth supported by solid increases in leasing and sales activity; management expects transaction revenue growth to slow as the recovery progresses.
- BOE: Mid-teens SOP growth led by data center solutions, local facilities management, and a full-year contribution from Pearce Services; BOE margins expected to be flat in 2026 as investments offset leverage.
- Project management: Low-teens SOP growth, with integration largely completed in 2026 and margin expansion expected.
- Real estate investments: Investment management and development operating profits expected to roughly match 2025, with timing uncertainty around data center land sales due to power lead times.
Giamartino also said growth trends from the fourth quarter continued through the first six weeks of the year across services segments. Advisory, BOE, and project management are expected to deliver double-digit SOP growth in the first quarter, with advisory showing notable strength despite it being historically the slowest quarter. As a result, CBRE expects first-quarter core EPS to comprise about 15% of full-year 2026 core EPS, a larger contribution than in the prior year’s first quarter.
Addressing capital markets sensitivity to rates, Sulentic said the company is “not counting on” interest rate cuts to drive sales and financing activity in 2026, pointing instead to a narrowing gap between asking and offering prices and the availability of capital. However, he reiterated that the recovery is expected to be “slow” and “steady,” rather than a rapid return to peak levels.
On AI, Sulentic said CBRE is deploying the technology to improve efficiency where it clearly exceeds traditional options and to build a “knowledge advantage” from its data. He said AI-driven tools are expected to yield concrete evidence of progress by the end of 2026, including plans to reduce research costs by about 25% over this year and potentially into next year, while delivering data more efficiently to brokers.
About CBRE Group (NYSE:CBRE)
CBRE Group, Inc is a global commercial real estate services and investment firm that provides a broad range of advisory, transactional and property-related services to occupiers, investors and owners. Its core activities include leasing and sales brokerage, facilities and property management, valuation and advisory, project and development services, and capital markets execution. The firm serves corporate occupiers, institutional investors, private owners and public entities across office, industrial, retail, multifamily and specialized property types.
In addition to traditional brokerage and management services, CBRE offers investment management capabilities and outsourced real estate solutions, combining market research, technology and data analytics to support portfolio strategy, transaction execution and asset operations.
