CB Richard Ellis 4Q15 Earnings Call Notes

CB Richard Ellis Group’s (CBG) CEO Bob Sulentic on Q4 2015

Fundamentals in our sector remain on solid footing

“While we are mindful of concerns about China’s slowing growth and the effect of lower oil prices, fundamentals in our sector remain on solid footing. We are positioned for another strong year in 2016, but are maintaining flexibility in case the economy weakens. Our outlook is based on economist consensus view that the global economy will maintain its modest rate of growth in 2016.”

It’s an active market place for what we do, you can’t draw conclusions from January

“outside of what the economists are talking about, what we are seeing with our clients is what you see in the guidance we gave by line of business. It’s an active market place for what we do. We are a month in to the year and it’s the slowest month of the year, so you can’t draw any conclusions. We’ve reflected what we believe kind of the collective view of our people and our people on the streets so to speak and our research people and our economist think and that’s all wound up in the guidance we gave by line of business.”

Jim Groch

Our business is a lot different than it was the last time we went into recession

“I think the business is just a different business than existed at that time. And the other comment I would make is our balance sheet is dramatically different balance sheet than existed at that time. We have enormous liquidity; we have very, very small amounts of maturities coming out for the next several years. So we are nicely poised to take advantage of opportunities. There are parts of our business that will be impacted if we go in to a recession, but overall I think we’ll see tremendous opportunities to take advantage of as well.”

Fairly optimistic about the strength of the sector

“we believe real estate offers compelling value today relative to other asset classes and capital flows in to real estate from enormously varied range of investment types and vehicles. And just the strength of the fundamentals in the sector and the value that’s embedded in that asset class and what we’ve seen in the market and performance in Q4 leaves us feeling fairly optimistic about the strength of the sector.”

Only comment is we expect Asia to be softer

“I think the only comment we make on a regional basis is that we expect Asia Pacific region to be softer, although let’s say in the rage of plus or minus flat, relative to the Americas and Europe where we expect it to be stronger.”