Upon completion of the transaction, CBRE will own 70 percent of the combined Turner & Townsend/CBRE project management business, with Turner & Townsend partners owning the remaining 30 percent. CBRE acquired a 60 percent stake in Turner & Townsend in November 2021. Since then, Turner & Townsend has grown its revenue at an average rate of more than 20 percent.
CBRE’s total project management business, including Turner & Townsend, generated net revenues of approximately $3 billion in 2023. Since 2021, combined net revenues have grown at a double-digit annual rate, with a net profit margin of approximately 15 percent. The net synergies resulting from the combination of the two businesses are expected to generate incremental run-rate core earnings per share of approximately $0.15 by the end of 2027, an amount that is expected to increase over time. The cost of the additional investment in Turner & Townsend/CBRE’s project management business is approximately $70 million, excluding transaction costs.
Bob Sulentic, CBRE Chairman and CEO said:
By combining our project management business, we have created an offering that is unmatched in its size and range of services. More than 20,000 employees serve customers in over 60 countries.
“Strong secular trends, particularly increased spending on infrastructure, green energy and employee satisfaction, are growth catalysts for this business and we are well positioned to capitalize on this significant opportunity.”
The combined company will be led by Vincent Clancy, Chairman and CEO of Turner & Townsend, who will continue to report to a board controlled by CBRE and comprised 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.
“By placing CBRE’s extensive global project management resources and capabilities under Vince’s leadership, we are strengthening our value proposition to our clients and advancing our growth ambitions.”
Vincent ClancyChairman and Chief Executive Officer of Turner & Townsend, said:
Since merging with CBRE in 2021, our goal has been to build the world’s leading, differentiated program, project and cost management capabilities.
“We have made extraordinary progress toward this goal, and our revenues and profits have increased significantly over the past three years. Turner & Townsend’s momentum will continue to grow by combining two great companies into a single, integrated, pure-play project management firm. Our combined wealth of talent and resources, global presence, industry expertise and commitment to excellence will be unmatched in project and program management.”
CBRE’s Board of Directors intends to appoint Mr. Clancy to CBRE’s Board of Directors following completion of the Transaction.
“Vince will bring a global perspective and extensive experience in key growth areas such as renewable energy and infrastructure to our Board. We look forward to his insights and contributions,” said Mr. Sulentic.
From 2025, CBRE intends to publish project management results in a new segment separate from Global Workplace Solutions to provide investors with greater transparency.
Turner & Townsend operates globally in three business areas: Real Estate – we serve investors and tenants of all property types, including data centers and life sciences; Infrastructure – particularly transportation and aviation; and Energy and Natural Resources – including renewable energy, alternative fuels and liquefied natural gas.
Subject to the satisfaction of regulatory and other customary conditions and the completion of necessary consultations with employee works councils in certain jurisdictions, the transaction is expected to close around year-end.