CBRE on Expansion Spree, Buys U.S. Equities Ops

Zacks Equity Research

CBRE Group, Inc. (CBG), recently announcing the acquisition of U.S. Equities Realty’s U.S.-based operations, seems to be on an expansion spree. This comes on the heels of another announcement made last week to acquire Preuss Gesellschaft mbH and its subsidiaries in Germany. With CBRE and U.S. Equities combining their Chicago area operations, experts from U.S. Equities will come on board for CBRE.

Founded in 1978, U.S. Equities offers a broad spectrum of commercial real estate services to its clients. Its development/program management, owner’s representation and consulting services are particularly expected to boost CBRE’s offerings.

Notably, U.S. Equities leases and manages 17 million sq. ft. of Chicago property as well as 2.5 million sq. ft. of assets along Chicago's Michigan Avenue. Moreover, with U.S. Equities accomplishing deals with companies like Ventas Inc. (VTR), Nike Inc. (NKE) and IBM Corporation (IBM), we believe that this acquisition would prove beneficial for CBRE.

As a matter of fact, strategic acquisitions have played a vital role in enhancing CBRE’s geographic coverage as well as broadening its service offerings. The Preuss deal represents CBRE’s second acquisition in Germany this year after the purchase of the real estate technical consulting firm – VALTEQ Gesellschaft mbH – in February this year.  

Moreover, the company has opted for larger, transformational deals driven by macro policies like that of UK-based commercial building technical engineering services provider – Norland Managed Services Ltd. As market conditions continue to improve, such opportunistic acquisitions, we believe, would serve as growth drivers, supplementing the company’s organic growth.

CBRE currently carries a Zacks Rank #3 (Hold).

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