Cbre Group Inc · NYSE:CBRE
Cbre — CB Richard Ellis Group — Investor Day (May 2007)
20 slides from Cbre's investor day presentation, May 18, 2007
Slide 1: Business Review Day: GCS Business Drivers
Business Review Day GCS Business Drivers Bill Concannon Vice Chairman May 18, 2007 Exhibit 99.4
Slide 2: Contents
Contents Key business drivers The evolution of outsourcing Our Win/Keep/Grow strategy
Slide 3: Key business drivers
Key business drivers Contents The evolution of outsourcing Our Win/Keep/Grow strategy
Slide 4: Corporate real estate groups are centralizing and expect to centralize further
Key Business Drivers Corporate real estate groups are centralizing and expect to centralize further 75% have centralized within the last three years (1) Only 5% have decentralized in the last three years (1) 65% expect to centralize further in the next five years (1) Only 2% expect to decentralize f
Slide 5: Centralized corporate real estate groups are being given increased responsibility
Key Business Drivers Centralized corporate real estate groups are being given increased responsibility All real estate and facilities functions housed in one organization Larger budgets and increased budget control Becoming strategic partner and service provider to business units Integration/collabo
Slide 6: Real estate leaders are increasingly from outside real estate
Key Business Drivers Real estate leaders are increasingly from outside real estate 4m Strategy consulting Top 5 global insurance brokerage 250m Business unit U.S. Fortune 20 telecom firm 80m Financial management officer U.S. Fortune 15 telecom firm 150m Human resources Large software company 60m Fie
Slide 7: Increasing investor interest in owning corporate real estate
Key Business Drivers Increasing investor interest in owning corporate real estate $3.6 trillion in commercial real estate assets owned by corporations (1) $11.2 billion in sale-leasebacks in 2006 – a 15% increase from 2005 (2) High prices/valuations for corporate-owned real estate assets (1) Prudent
Slide 8: High M&A and private equity buyout volume
Key Business Drivers High M&A and private equity buyout volume Real estate and facilities generally part of post-merger and post-LBO corporate transformations $3.7 trillion in global M&A volume in 2006 – up by 30% (1) $375 billion in U.S. private equity buyouts in 2006 – up by 250% (1) (1) Thomson F
Slide 9: Corporate focus on space utilization and environmental sustainability
Key Business Drivers Corporate focus on space utilization and environmental sustainability 45-60% of space in the average U.S. HQ/regional office is unoccupied each day (1) Leading firms experimenting with alternative workplace solutions (e.g. different design standards, hoteling) Environmental sust
Slide 10: Continued real estate outsourcing growth
Key Business Drivers Continued real estate outsourcing growth 90% expect outsourced corporate real estate spend to increase - with 45% expecting it to “increase greatly” (1) Outsourcing expected to “increase significantly” for all GCS services (1) Firms seek “speed to market”, “access to qualified p
Slide 11: The evolution of outsourcing
The evolution of outsourcing Contents Key business drivers Our Win/Keep/Grow strategy
Slide 12: Corporate Real Estate Outsourcing Continues to Evolve
Up to 1980’s In-House 1980’s Out-Tasking In-House 1990’s Out-Sourcing In-House 2000’s Alliance Partnerships Today & Beyond VALUE DELIVERED Corporate Real Estate Outsourcing Continues to Evolve
Slide 13: Today and Beyond Favor Global, Full-Service Providers
Today and Beyond Favor Global, Full-Service Providers Clients seeking breadth of global coverage: #1 service provider criterion (1) Clients seeking breadth of services: #3 service provider criterion (1) Long, intensive business development cycles: often 9-12 months or more Clients demand global best
Slide 14: GCS Addresses the Total Occupancy Cost Universe
Repairs 8% Contracts 13% Utilities 15% Payroll 7% Depr/Amort 17% RE Tax 10% Rent 26% Annual Operating Expenses MIS, Telecom, Cabling 12% Furniture & Workstations 20% Construction Labor & Materials 49% Moving Expense 7% Architect/ Engineer 6% Project Mgmt 6% Annual Capital Expenses GCS Addresses the
Slide 15: Contents
Our Win/Keep/Grow strategy Contents Key business drivers The evolution of outsourcing
Slide 16: How Our Clients Buy
Brokerage One-off/Local “Programs” (e.g., Compliance, Operational Refit, Growth, Rebranding) “ Preferred” Brokerage – No Contract Single Transaction + PjM One-off/Local “Projects” Contract w/ Renewable Term Contract w/ Finite Term No Contract – Deal by Deal (Single or Multiple Service) Full Service
Slide 17: WIN
WIN Our Win/Keep/Grow strategy Move CBRE “Project” & “Preferred” clients (usually Brokerage) to contracts Embed sales/consulting in select number of largest global opportunities Win outsourcing opportunities in the market (i.e. RFPs) Target key clients in Government and Healthcare verticals KEEP GRO
Slide 18: KEEP
KEEP Our Win/Keep/Grow strategy Apply client satisfaction and operational excellence methodologies to clients Renewal of clients with expanded terms Embed sales/consulting in advance of large renewals WIN GROW
Slide 19: GROW
GROW Our Win/Keep/Grow strategy Target ~ 115 TCC clients for geographical expansion outside the U.S. Target ~ 90 TCC clients for cross-selling Transaction Management Target ~110 CBRE clients for cross-selling Project Management and Facilities Management WIN KEEP
Slide 20: Our Win/Keep/Grow differentiators
Our Win/Keep/Grow differentiators Thousands of local CBRE relationships Globally integrated sales/marketing team Industry’s largest base of subject matter experts in each service line Industry’s largest base of global consulting professionals Industry-specific specialty groups (e.g. financial servic