Guarantor and Nonguarantor Financial Statements (Tables)

3 Months Ended

Mar. 31, 2018

Organization Consolidation And Presentation Of Financial Statements [Abstract]

CONDENSED CONSOLIDATING BALANCE SHEET

AS OF MARCH 31, 2018

(Dollars in thousands)

			CBRE		Guarantor		Nonguarantor					Consolidated
	Parent		Services		Subsidiaries		Subsidiaries		Eliminations			Total
ASSETS
Current Assets:
Cash and cash equivalents	$	7	$	8,122	$	71,960	$	562,765	$	—		$	642,854
Restricted cash		—		—		2,066		76,893		—			78,959
Receivables, net		—		—		1,076,642		2,044,878		—			3,121,520
Warehouse receivables (1)		—		—		744,919		416,749		—			1,161,668
Prepaid expenses		—		—		70,409		153,337		—			223,746
Contract assets		—		—		193,787		6,380		—			200,167
Income taxes receivable		1,419		5,886		8,666		52,733		(7,306	)		61,398
Other current assets		—		—		74,310		189,678		—			263,988
Total Current Assets		1,426		14,008		2,242,759		3,503,413		(7,306	)		5,754,300
Property and equipment, net		—		—		437,939		195,727		—			633,666
Goodwill		—		—		1,759,043		1,519,588		—			3,278,631
Other intangible assets, net		—		—		745,391		653,112		—			1,398,503
Investments in unconsolidated subsidiaries		—		—		184,486		44,464		—			228,950
Investments in consolidated subsidiaries		5,799,674		5,310,057		3,191,735		—		(14,301,466	)		—
Intercompany loan receivable		—		2,684,781		700,000		—		(3,384,781	)		—
Deferred tax assets, net		—		—		5,300		97,515		(956	)		101,859
Other assets, net		—		21,630		378,406		111,497		—			511,533
Total Assets	$	5,801,100	$	8,030,476	$	9,645,059	$	6,125,316	$	(17,694,509	)	$	11,907,442
LIABILITIES AND EQUITY
Current Liabilities:
Accounts payable and accrued expenses	$	—	$	5,893	$	402,645	$	1,096,596	$	—		$	1,505,134
Compensation and employee benefits payable		—		626		483,114		447,832		—			931,572
Accrued bonus and profit sharing		—		—		239,231		353,715		—			592,946
Contract liabilities		—		—		31,020		57,056		—			88,076
Income taxes payable		—		—		41,569		32,097		(7,306	)		66,360
Short-term borrowings:										—
Warehouse lines of credit (which fund loans that U.S. Government Sponsored Enterprises have committed to purchase) (1)		—		—		736,961		411,044		—			1,148,005
Revolving credit facility		—		463,000		—		—		—			463,000
Other		—		—		16		—		—			16
Total short-term borrowings		—		463,000		736,977		411,044		—			1,611,021
Current maturities of long-term debt		—		—		—		51		—			51
Other current liabilities		—		—		48,786		25,709		—			74,495
Total Current Liabilities		—		469,519		1,983,342		2,424,100		(7,306	)		4,869,655
Long-Term Debt, net:
Long-term debt, net		—		1,758,188		—		—		—			1,758,188
Intercompany loan payable		1,443,469		—		1,872,718		68,594		(3,384,781	)		—
Total Long-Term Debt, net		1,443,469		1,758,188		1,872,718		68,594		(3,384,781	)		1,758,188
Deferred tax liabilities, net		—		—		41,181		125,334		(956	)		165,559
Non-current tax liabilities		—		—		137,899		6,859		—			144,758
Other liabilities		—		3,095		299,862		247,651		—			550,608
Total Liabilities		1,443,469		2,230,802		4,335,002		2,872,538		(3,393,043	)		7,488,768
Commitments and contingencies		—		—		—		—		—			—
Equity:
CBRE Group, Inc. Stockholders’ Equity		4,357,631		5,799,674		5,310,057		3,191,735		(14,301,466	)		4,357,631
Non-controlling interests		—		—		—		61,043		—			61,043
Total Equity		4,357,631		5,799,674		5,310,057		3,252,778		(14,301,466	)		4,418,674
Total Liabilities and Equity	$	5,801,100	$	8,030,476	$	9,645,059	$	6,125,316	$	(17,694,509	)	$	11,907,442

(1)

Although CBRE Capital Markets is included among our domestic subsidiaries that jointly and severally guarantee our 4.875% senior notes, 5.25% senior notes and our 2017 Credit Agreement, a substantial majority of warehouse receivables funded under JP Morgan, Capital One, BofA, TD Bank and Fannie Mae ASAP lines of credit are pledged to JP Morgan, Capital One, BofA, TD Bank and Fannie Mae.

CONDENSED CONSOLIDATING BALANCE SHEET

AS OF DECEMBER 31, 2017 (AS ADJUSTED) (1)

(Dollars in thousands)

			CBRE		Guarantor		Nonguarantor					Consolidated
	Parent		Services		Subsidiaries		Subsidiaries		Eliminations			Total
ASSETS
Current Assets:
Cash and cash equivalents	$	7	$	15,604	$	112,048	$	624,115	$	—		$	751,774
Restricted cash		—		—		2,095		70,950		—			73,045
Receivables, net		—		—		990,923		2,121,366		—			3,112,289
Warehouse receivables (2)		—		—		479,628		448,410		—			928,038
Prepaid expenses		—		—		81,106		134,230		—			215,336
Contract assets		—		—		263,756		9,297		—			273,053
Income taxes receivable		2,162		—		—		49,628		(2,162	)		49,628
Other current assets		—		—		50,556		176,865		—			227,421
Total Current Assets		2,169		15,604		1,980,112		3,634,861		(2,162	)		5,630,584
Property and equipment, net		—		—		431,755		185,984		—			617,739
Goodwill		—		—		1,774,529		1,480,211		—			3,254,740
Other intangible assets, net		—		—		751,930		647,182		—			1,399,112
Investments in unconsolidated subsidiaries		—		—		197,395		40,606		—			238,001
Investments in consolidated subsidiaries		5,551,781		4,930,109		3,066,303		—		(13,548,193	)		—
Intercompany loan receivable		—		2,621,330		700,000		—		(3,321,330	)		—
Deferred tax assets, net		—		—		5,300		98,746		(5,300	)		98,746
Other assets, net		—		22,810		348,191		108,473		—			479,474
Total Assets	$	5,553,950	$	7,589,853	$	9,255,515	$	6,196,063	$	(16,876,985	)	$	11,718,396
LIABILITIES AND EQUITY
Current Liabilities:
Accounts payable and accrued expenses	$	—	$	29,708	$	404,367	$	1,139,597	$	—		$	1,573,672
Compensation and employee benefits payable		—		626		479,306		424,502		—			904,434
Accrued bonus and profit sharing		—		—		590,534		487,811		—			1,078,345
Contract liabilities		—		—		42,994		57,621		—			100,615
Income taxes payable		—		3,314		13,704		55,778		(2,162	)		70,634
Short-term borrowings:										—
Warehouse lines of credit (which fund loans that U.S. Government Sponsored Enterprises have committed to purchase) (2)		—		—		474,195		436,571		—			910,766
Other		—		—		16		—		—			16
Total short-term borrowings		—		—		474,211		436,571		—			910,782
Current maturities of long-term debt		—		—		—		8		—			8
Other current liabilities		—		55		56,260		18,139		—			74,454
Total Current Liabilities		—		33,703		2,061,376		2,620,027		(2,162	)		4,712,944
Long-Term Debt, net:
Long-term debt, net		—		1,999,603		—		—		—			1,999,603
Intercompany loan payable		1,439,454		—		1,798,550		83,326		(3,321,330	)		—
Total Long-Term Debt, net		1,439,454		1,999,603		1,798,550		83,326		(3,321,330	)		1,999,603
Deferred tax liabilities, net		—		—		29,785		122,733		(5,300	)		147,218
Non-current tax liabilities		—		—		135,396		5,396		—			140,792
Other liabilities		—		4,766		300,299		238,160		—			543,225
Total Liabilities		1,439,454		2,038,072		4,325,406		3,069,642		(3,328,792	)		7,543,782
Commitments and contingencies		—		—		—		—		—			—
Equity:
CBRE Group, Inc. Stockholders’ Equity		4,114,496		5,551,781		4,930,109		3,066,303		(13,548,193	)		4,114,496
Non-controlling interests		—		—		—		60,118		—			60,118
Total Equity		4,114,496		5,551,781		4,930,109		3,126,421		(13,548,193	)		4,174,614
Total Liabilities and Equity	$	5,553,950	$	7,589,853	$	9,255,515	$	6,196,063	$	(16,876,985	)	$	11,718,396

(1)	In the first quarter of 2018, we adopted new revenue recognition guidance. Certain restatements have been made to the 2017 financial statements to conform with the 2018 presentation. See Notes 2 and 3 for more information.

(2)

Although CBRE Capital Markets is included among our domestic subsidiaries that jointly and severally guarantee our 5.00% senior notes, 4.875% senior notes, 5.25% senior notes and our 2017 Credit Agreement, a substantial majority of warehouse receivables funded under TD Bank, Fannie Mae ASAP, JP Morgan, Capital One and BofA lines of credit are pledged to TD Bank, Fannie Mae, JP Morgan, Capital One and BofA, and accordingly, are not included as collateral for these notes or our other outstanding debt.

Condensed Consolidating Statement of Operations

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

FOR THE THREE MONTHS ENDED MARCH 31, 2018

(Dollars in thousands)

				CBRE			Guarantor		Nonguarantor						Consolidated
	Parent			Services			Subsidiaries		Subsidiaries			Eliminations			Total
Revenue	$	—		$	—		$	2,617,694	$	2,056,258		$	—		$	4,673,952
Costs and expenses:
Cost of services		—			—			2,057,613		1,562,348			—			3,619,961
Operating, administrative and other		5,704			485			372,345		353,701			—			732,235
Depreciation and amortization		—			—			64,309		43,856			—			108,165
Total costs and expenses		5,704			485			2,494,267		1,959,905			—			4,460,361
Gain on disposition of real estate		—			—			18		—			—			18
Operating (loss) income		(5,704	)		(485	)		123,445		96,353			—			213,609
Equity income from unconsolidated subsidiaries		—			—			39,292		887			—			40,179
Other income (loss)		—			—			1,710		(5,990	)		—			(4,280	)
Interest income		—			32,686			2,452		1,169			(32,686	)		3,621
Interest expense		—			27,875			27,031		6,638			(32,686	)		28,858
Write-off of financing costs on extinguished debt		—			27,982			—		—			—			27,982
Royalty and management service expense (income)		—			—			698		(698	)		—			—
Income from consolidated subsidiaries		154,573			172,343			60,412		—			(387,328	)		—
Income before (benefit of) provision for income taxes		148,869			148,687			199,582		86,479			(387,328	)		196,289
(Benefit of) provision for income taxes		(1,419	)		(5,886	)		27,239		26,230			—			46,164
Net income		150,288			154,573			172,343		60,249			(387,328	)		150,125
Less: Net loss attributable to non- controlling interests		—			—			—		(163	)		—			(163	)
Net income attributable to CBRE Group, Inc.	$	150,288		$	154,573		$	172,343	$	60,412		$	(387,328	)	$	150,288

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

FOR THE THREE MONTHS ENDED MARCH 31, 2017 (AS ADJUSTED) (1)

(Dollars in thousands)

				CBRE			Guarantor			Nonguarantor					Consolidated
	Parent			Services			Subsidiaries			Subsidiaries		Eliminations			Total
Revenue	$	—		$	—		$	2,418,600		$	1,632,366	$	—		$	4,050,966
Costs and expenses:
Cost of services		—			—			1,920,688			1,225,789		—			3,146,477
Operating, administrative and other		(284	)		349			315,809			290,752		—			606,626
Depreciation and amortization		—			—			56,730			37,307		—			94,037
Total costs and expenses		(284	)		349			2,293,227			1,553,848		—			3,847,140
Gain on disposition of real estate		—			—			226			1,159		—			1,385
Operating income (loss)		284			(349	)		125,599			79,677		—			205,211
Equity income from unconsolidated subsidiaries		—			—			14,370			648		—			15,018
Other income		—			—			414			3,701		—			4,115
Interest income		—			29,901			1,647			764		(29,901	)		2,411
Interest expense		—			33,146			22,148			8,617		(29,901	)		34,010
Royalty and management service (income) expense		—			—			(5,802	)		5,802		—			—
Income from consolidated subsidiaries		136,845			139,064			45,519			—		(321,428	)		—
Income before provision for (benefit of) income taxes		137,129			135,470			171,203			70,371		(321,428	)		192,745
Provision for (benefit of) income taxes		109			(1,375	)		32,139			22,946		—			53,819
Net income		137,020			136,845			139,064			47,425		(321,428	)		138,926
Less: Net income attributable to non- controlling interests		—			—			—			1,906		—			1,906
Net income attributable to CBRE Group, Inc.	$	137,020		$	136,845		$	139,064		$	45,519	$	(321,428	)	$	137,020

(1)	In the first quarter of 2018, we adopted new revenue recognition guidance. Certain restatements have been made to the 2017 financial statements to conform with the 2018 presentation. See Notes 2 and 3 for more information.

Condensed Consolidating Statement of Comprehensive Income

CONDENSED CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME

FOR THE THREE MONTHS ENDED MARCH 31, 2018

(Dollars in thousands)

			CBRE		Guarantor			Nonguarantor						Consolidated
	Parent		Services		Subsidiaries			Subsidiaries			Eliminations			Total
Net income	$	150,288	$	154,573	$	172,343		$	60,249		$	(387,328	)	$	150,125
Other comprehensive (loss) income:
Foreign currency translation gain		—		—		—			66,032			—			66,032
Adoption of Accounting Standards Update 2016-01, net		—		—		(3,964	)		—			—			(3,964	)
Amounts reclassified from accumulated other comprehensive loss to interest expense, net		—		755		—			—			—			755
Unrealized gains on interest rate swaps, net		—		603		—			—			—			603
Unrealized holding losses on available for sale debt securities, net		—		—		(505	)		—			—			(505	)
Other, net		—		—		20			5,508			—			5,528
Total other comprehensive (loss) income		—		1,358		(4,449	)		71,540			—			68,449
Comprehensive income		150,288		155,931		167,894			131,789			(387,328	)		218,574
Less: Comprehensive loss attributable to non-controlling interests		—		—		—			(358	)		—			(358	)
Comprehensive income attributable to CBRE Group, Inc.	$	150,288	$	155,931	$	167,894		$	132,147		$	(387,328	)	$	218,932

CONDENSED CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME

FOR THE THREE MONTHS ENDED MARCH 31, 2017 (AS ADJUSTED) (1)

(Dollars in thousands)

				CBRE		Guarantor			Nonguarantor					Consolidated
	Parent			Services		Subsidiaries			Subsidiaries		Eliminations			Total
Net income	$	137,020		$	136,845	$	139,064		$	47,425	$	(321,428	)	$	138,926
Other comprehensive (loss) income:
Foreign currency translation gain		—			—		—			51,188		—			51,188
Amounts reclassified from accumulated other comprehensive loss to interest expense, net		—			1,508		—			—		—			1,508
Unrealized gains on interest rate swaps, net		—			294		—			—		—			294
Unrealized holding gains on available for sale debt securities, net		—			—		829			94		—			923
Other, net		(5	)		—		(1	)		—		—			(6	)
Total other comprehensive (loss) income		(5	)		1,802		828			51,282		—			53,907
Comprehensive income		137,015			138,647		139,892			98,707		(321,428	)		192,833
Less: Comprehensive income attributable to non-controlling interests		—			—		—			1,927		—			1,927
Comprehensive income attributable to CBRE Group, Inc.	$	137,015		$	138,647	$	139,892		$	96,780	$	(321,428	)	$	190,906

(1)	In the first quarter of 2018, we adopted new revenue recognition guidance. Certain restatements have been made to the 2017 financial statements to conform with the 2018 presentation. See Notes 2 and 3 for more information.

Condensed Consolidating Statement of Cash Flows

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

FOR THE THREE MONTHS ENDED MARCH 31, 2018

(Dollars in thousands)

				CBRE			Guarantor			Nonguarantor			Consolidated
	Parent			Services			Subsidiaries			Subsidiaries			Total
CASH FLOWS PROVIDED BY (USED IN) OPERATING ACTIVITIES:	$	26,028		$	(21,075	)	$	(200,152	)	$	(54,759	)	$	(249,958	)
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures		—			—			(30,870	)		(15,854	)		(46,724	)
Contributions to unconsolidated subsidiaries		—			—			(7,932	)		(2,679	)		(10,611	)
Distributions from unconsolidated subsidiaries		—			—			14,869			347			15,216
Purchase of equity securities		—			—			(10,219	)		—			(10,219	)
Proceeds from sale of equity securities		—			—			4,367			—			4,367
Purchase of available for sale debt securities		—			—			(12,066	)		—			(12,066	)
Proceeds from the sale of available for sale debt securities		—			—			2,264			—			2,264
Other investing activities, net		—			—			(6,590	)		151			(6,439	)
Net cash used in investing activities		—			—			(46,177	)		(18,035	)		(64,212	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from senior term loans		—			550,000			—			—			550,000
Proceeds from revolving credit facility		—			898,000			—			—			898,000
Repayment of revolving credit facility		—			(435,000	)		—			—			(435,000	)
Repayment of 5.00% senior notes (including premium)		—			(820,000	)		—			—			(820,000	)
Proceeds from notes payable on real estate held for investment		—			—			—			49			49
Repayment of notes payable on real estate held for investment		—			—			—			(462	)		(462	)
Proceeds from notes payable on real estate held for sale and under development		—			—			—			775			775
Acquisition of businesses (cash (paid) received for acquisitions more than three months after purchase date)		—			—			(11,463	)		3,414			(8,049	)
Units repurchased for payment of taxes on equity awards		(4,550	)		—			—			—			(4,550	)
Non-controlling interest contributions		—			—			—			1,595			1,595
Non-controlling interest distributions		—			—			—			(1,025	)		(1,025	)
(Increase) decrease in intercompany receivables, net		(21,532	)		(179,368	)		217,675			(16,775	)		—
Other financing activities, net		54			(39	)		—			(3	)		12
Net cash (used in) provided by financing activities		(26,028	)		13,593			206,212			(12,432	)		181,345
Effect of currency exchange rate changes on cash and cash equivalents and restricted cash		—			—			—			29,819			29,819
NET DECREASE IN CASH AND CASH EQUIVALENTS AND RESTRICTED CASH		—			(7,482	)		(40,117	)		(55,407	)		(103,006	)
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH, AT BEGINNING OF PERIOD		7			15,604			114,143			695,065			824,819
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH, AT END OF PERIOD	$	7		$	8,122		$	74,026		$	639,658		$	721,813
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest	$	—		$	48,490		$	—		$	504		$	48,994
Income taxes, net	$	—		$	—		$	118		$	37,101		$	37,219

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

FOR THE THREE MONTHS ENDED MARCH 31, 2017 (AS ADJUSTED) (1)

(Dollars in thousands)

				CBRE			Guarantor			Nonguarantor			Consolidated
	Parent			Services			Subsidiaries			Subsidiaries			Total
CASH FLOWS PROVIDED BY (USED IN) OPERATING ACTIVITIES:	$	17,610		$	(6,445	)	$	(311,417	)	$	(21,146	)	$	(321,398	)
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures		—			—			(17,095	)		(6,640	)		(23,735	)
Acquisition of businesses, including net assets acquired, intangibles and goodwill		—			—			(12,861	)		—			(12,861	)
Contributions to unconsolidated subsidiaries		—			—			(11,086	)		(3,481	)		(14,567	)
Distributions from unconsolidated subsidiaries		—			—			6,676			199			6,875
Purchase of equity securities		—			—			(3,914	)		539			(3,375	)
Proceeds from the sale of equity securities		—			—			3,805			(390	)		3,415
Purchase of available for sale debt securities		—			—			(3,375	)		(539	)		(3,914	)
Proceeds from the sale of available for sale debt securities		—			—			3,415			390			3,805
Other investing activities, net		—			—			1,275			(195	)		1,080
Net cash used in investing activities		—			—			(33,160	)		(10,117	)		(43,277	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from revolving credit facility		—			266,000			—			—			266,000
Repayment of revolving credit facility		—			(146,000	)		—			—			(146,000	)
Repayment of notes payable on real estate held for investment		—			—			—			(435	)		(435	)
Proceeds from notes payable on real estate held for sale and under development		—			—			—			1,711			1,711
Repayment of notes payable on real estate held for sale and under development		—			—			—			(2,744	)		(2,744	)
Acquisition of businesses (cash paid for acquisitions more than three months after purchase date)		—			—			(7,717	)		(626	)		(8,343	)
Units repurchased for payment of taxes on equity awards		(1,900	)		—			—			—			(1,900	)
Non-controlling interest contributions		—			—			—			1,574			1,574
Non-controlling interest distributions		—			—			—			(744	)		(744	)
(Increase) decrease in intercompany receivables, net		(16,020	)		(121,766	)		126,426			11,360			—
Other financing activities, net		310			—			—			(2	)		308
Net cash (used in) provided by financing activities		(17,610	)		(1,766	)		118,709			10,094			109,427
Effect of currency exchange rate changes on cash and cash equivalents and restricted cash		—			—			—			16,163			16,163
NET DECREASE IN CASH AND CASH EQUIVALENTS AND RESTRICTED CASH		—			(8,211	)		(225,868	)		(5,006	)		(239,085	)
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH, AT BEGINNING OF PERIOD		7			16,889			271,088			543,428			831,412
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH, AT END OF PERIOD	$	7		$	8,678		$	45,220		$	538,422		$	592,327
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest	$	—		$	51,987		$	—		$	40		$	52,027
Income taxes, net	$	—		$	—		$	5,176		$	32,157		$	37,333

(1)	In the first quarter of 2018, we adopted new revenue recognition guidance. Certain restatements have been made to the 2017 financial statements to conform with the 2018 presentation. See Notes 2 and 3 for more information.