In order to boost its cross-border Global Corporate Services (‘GCS’) offering, CBRE Group Inc. (CBG) penned a renewal and expansion deal with Bank of America Corp (NYSE:BAC) Merrill Lynch (‘BofAML’) of Bank of America Corp. (BAC). Besides providing services to BofAML’s business across Latin America (LATAM), Asia Pacific (APAC) and Europe, the Middle East and Africa (EMEA), the company will now offer services to Bank of America Corp (NYSE:BAC)’s operations in South Africa and its Enterprise Services in Taiwan.
Particularly, as per the renewal deal, CBRE Group will offer transaction, critical engineering, project and facilities management, portfolio and consultancy services for Bank of America Corp (NYSE:BAC) through GCS across LATAM, APAC and EMEA regions. Overall, with the contract, CBRE Group will now handle a portfolio for BofAML, spanning 4.4 million square feet in 41 countries across LATAM, APAC and EMEA.
With market conditions continuing to improve, we believe such opportunistic deals would serve as growth drivers for CBRE Group. Also, the strengthening of ties with its clients bodes well for improvement of the company’s GCS business going forward.
Earlier this month, CBRE Group came up with its fourth-quarter 2013 results. The company’s adjusted earnings stood at 67 cents per share, a penny ahead of the Zacks Consensus Estimate and up 22% year over year.
Quarterly results were driven by strong contribution from the global investment management and property sales, improved leasing momentum and occupier outsourcing business. Yet, commercial mortgage brokerage revenue continued to decline owing to the negative impact from the U.S. Government-Sponsored Enterprises’ (GSEs) initiatives to scale back their lending activity, as commanded by the regulators.
CBRE Group currently carries a Zacks Rank #4 (Sell). Some better-ranked stocks in the real estate operations industry include NorthStar Realty Finance Corp. (NRF) and Jones Lang LaSalle Inc. (JLL). Both stocks carry a Zacks Rank #2 (Buy).