NEW YORK CITY-A rising market coupled with internal initiatives across Cushman & Wakefield paid off in double-digit increase in fourth-quarter and full-year earnings, CEO Glenn Rufrano tells GlobeSt.com. “We hit a nice fulcrum in the fourth quarter, with the company providing the resources necessary to capture market share and having a market that provided market share,” he says.
Across the globe, the year prior represented C&W's second-highest gross revenue in its 95-year history at $2.05 billion, while its operating income and EBITDA saw year-over-year growth of 22.6% and 14.9%, respectively. In Q4, operating income more than doubled and EBITDA grew 76.2%.
While internal initiatives and a rising CRE market underpinned the growth, Rufrano points out that the upturn played out in different ways across the globe. In the US during Q4, “we had a very good capital markets turn,” he says—driven in large measure by anticipated tax increases for 2013. For the EMEA region, “a soft spot for all of us,” pent-up demand drove what Rufrano calls a “reasonable” Q4. Asian growth was driven in large measure by China's reversal of direction on liquidity in the second half of the year, after the continent's largest economy sought to clamp down on inflation—and, therefore, banks' liquidity—during the first six months of 2012.
Internally, C&W made certain it was ready to meet the rising market, beginning its preparation a couple of years before that market upturn arrived. “Starting in 2010, we put together a nice global alignment of management,” Rufrano says. “From a capital markets standpoint, from a leasing standpoint and from a corporate services standpoint, we coordinated well, and because of that coordination had a successful Q4 around the globe. If you look at the global trends, they're important, but if you couldn't tie them together, it wouldn't do any good. We were able to tie them together through global alignment of management, and we were able to execute.”
A move toward what Rufrano calls “a consistent service mix” across the globe complemented this alignment of management. “By that, we mean having the right people in the right spots to take advantage of market share.” In both 2011 and last year, he adds, “we were able to invest in very good people: good capital markets team in the right locations, good leasing teams in the right locations, good appraisal teams in the right locations.”
For 2013, in contrast to the “year of uncertainty” that ended this past Dec. 31, we'll be seeing “a year of less uncertainty,” Rufrano says. “We can define 'less uncertain' as having confidence. Our business depends on the confidence of participants in the real estate market to make decisions—to lease, buy, sell, hire new managers—and we believe there will be more of those decisions made in 2013.”
In terms of dollars, '12 represented $929 billion in transactional volume across the globe. “We're forecasting that number to go to about $1 trillion this year,” or a 14% increase over the year prior, says Rufrano. Region by region, C&W expects Asia Pacific to go up by 15% to 20% this year, as will volume in the Americas, while EMEA is expected to see a 5% increase, he says.
Accordingly, Rufrano says, “We believe our business will be up. We expect our revenues and EBITDA to be up over '12 levels,” again thanks to a combination of less uncertainty in the marketplace and continued proactivity on the company's part.
Want to continue reading?
Become a Free ALM Digital Reader.
Once you are an ALM Digital Member, you’ll receive:
- Breaking commercial real estate news and analysis, on-site and via our newsletters and custom alerts
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical coverage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
*May exclude premium content© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
Paul Bubny
Paul Bubny is managing editor of Real Estate Forum and GlobeSt.com. He has been reporting on business since 1988 and on commercial real estate since 2007. He is based at ALM Real Estate Media Group's offices in New York City.
