Upon completion of the transaction, CBRE will own 70 percent of the combined project management business of Turner & Townsend/CBRE, with Turner & Townsend’s partners owning the remaining 30 percent. CBRE acquired a 60 percent ownership interest in Turner & Townsend in November 2021. Since then, Turner & Townsend’s revenue has grown at a compound rate of more than 20 percent.
CBRE’s entire project management business, including Turner & Townsend, generated net revenue of approximately $3 billion in 2023. Since 2021, combined net sales have grown by double digits annually, with a net profit margin of approximately 15 percent. The net synergies from bringing the two companies together are expected to generate approximately $0.15 in incremental run-rate core EPS by the end of 2027, an amount that is expected to grow over time. The cost of the additional investment in Turner & Townsend/CBRE project management is approximately $70 million, excluding deal costs.
Bob Sulentic, The Chairman and Chief Executive Officer of CBRE said:
Uniting our project management businesses creates an offering that is unparalleled in scale and breadth of capabilities, with more than 20,000 employees serving clients in more than 60 countries.
“Strong secular trends, particularly increased spending on infrastructure, green energy and employee experience, are growth catalysts for this company and we are well positioned to capitalize on this important opportunity.”
The combined company will be led by Vincent Clancy, Turner & Townsend’s Chairman and Chief Executive Officer, who will continue to report to a board of directors controlled by CBRE and composed of senior executives from both CBRE and Turner & Townsend.
“Vince is an exemplary leader who has led Turner & Townsend to great success,” said Mr. Sulentic.
“Bringing CBRE’s extensive global project management resources and capabilities under Vince will strengthen our customer value proposition and further our growth ambitions.”
Vincent Clancysaid the chairman and CEO of Turner & Townsend:
Since joining forces with CBRE in 2021, our ambition has been to create best-in-class, differentiated program, project and cost management capabilities globally.
“We have made exceptional progress towards this goal and our revenue and profits have grown significantly over the past three years. Turner & Townsend’s momentum will continue to grow with the combination of two great companies into one integrated, pure project management capability. combined depth of talent and resources, global footprint, sector expertise and commitment to excellence will be unparalleled in project and program management.”
The CBRE Board of Directors intends to appoint Mr. Clancy to the CBRE Board of Directors once the transaction is completed.
“Vince will bring a global perspective and deep experience in key growth areas such as renewable energy and infrastructure to our Board of Directors. We look forward to his insights and contributions,” said Mr. Sulentic.
CBRE plans to report project management results in a new segment, separate from Global Workplace Solutions, from 2025 to provide greater transparency to investors.
Turner & Townsend operates globally in three business segments: real estate – serving investors and occupiers in all types of real estate, including data centers and life sciences; infrastructure – especially transport and aviation; and energy and natural resources – including renewable energy, alternative fuels and liquefied natural gas.
The transaction is expected to close around the end of the year, subject to the satisfaction of regulatory and other customary closing conditions and the completion of required consultations with employee works councils in certain jurisdictions.