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Employee Benefit Plans | 12 Months Ended
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Dec. 31, 2019
Compensation And Retirement Disclosure [Abstract] |
Employee Benefit Plans |
1 4. | Employee Benefit Plans
Stock Incentive Plans 2012 Equity Incentive Plan and 2017 Equity Incentive Plan Our 2012 equity incentive plan and 2017 equity incentive plan were adopted by our board of directors and approved by our stockholders on May 8, 2012 and May 19, 2017, respectively. Both the 2012 and 2017 equity incentive plans authorized the grant of stock-based awards to our employees, directors and independent contractors. Our 2012 equity incentive plan was terminated in May 2017 in connection with the adoption of our 2017 equity incentive pla n. Our 2017 equity incentive plan was terminated in May 2019 in connection with the adoption of our 2019 equity incentive plan, which is described below. At termination of the 2012 equity incentive plan, no unissued shares from the 2012 stock incentive plan were allocated to the 2017 equity incentive plan for potential future issuance. At termination of the 2017 equity incentive plan, no unissued shares from the 2017 equity incentive plan were allocated to the 2019 equity incentive plan for potential future issuance. Since our 2012 and 2017 equity incentive plans have been terminated, no new awards may be granted under them. A s of December 31, 201 9, assuming the maximum number of shares under our performance-based awards will later be issued, 2,166,537 outstanding restricted stock unit (RSU) awards to acquire shares of our Class A common stock granted under the 2012 equity incentive plan remain outstanding according to their terms, and we will continue to issue shares to the extent required under the terms of such outstanding awards. Shares underlying awards that expire, terminate or lapse under the 2012 equity incentive plan will not become available for grant under the 2017 equity incentive plan or the 2019 equity incentive plan. As of December 31, 2019, 5,736,560 outstanding RSU awards to acquire shares of our Class A common stock granted under the 2017 equity incentive plan remain outstanding according to their terms, and we will continue to issue shares to the extent required under the terms of such outstanding awards (noting that any shares granted above target will get deducted from the 2019 equity incentive plan reserve as noted below). Shares underlying awards outstanding under the 2017 equity incentive plan at termination that are subsequently canceled, forfeited or terminated without issuance to the holder thereof will be available for grant under the 2019 equity incentive plan. 2019 Equity Incentive Plan Our 2019 equity incentive plan was adopted by our board of directors on March 1, 2019 and approved by our stockholders on May 17, 2019. The 2019 equity incentive plan authorizes the grant of stock-based awards to employees, directors and independent contractors. Unless terminated earlier, the 2019 equity incentive plan will terminate on March 1, 2029. A total of 9,900,000 shares of our Class A common stock are reserved for issuance under the 2019 equity incentive plan, less 189,499 shares granted under the 2017 equity incentive plan between March 1, 2019, the date our board of directors approved the plan, and May 17, 2019, the date our stockholders approved the 2019 equity incentive plan. Additionally, as mentioned above, shares underlying awards outstanding under the 2017 equity incentive plan at termination that are subsequently canceled, forfeited or terminated without issuance to the holder thereof will be available for reissuance under the 2019 equity incentive plan. As of December 31, 2019, 234,242 shares were canceled under the 2017 equity incentive plan and added to the authorized pool for the 2019 equity incentive plan, bringing the total authorized amount under the 2019 equity incentive plan to 9,944,743 shares of our Class A common stock. Shares underlying expired, canceled, forfeited or terminated awards under the 2019 equity incentive plan (other than awards granted in substitution of an award previously granted), plus those utilized to pay tax withholding obligations with respect to an award (other than an option or stock appreciation right) will be available for reissuance. Awards granted under the 2019 equity incentive plan are subject to a minimum vesting condition of one year. As of December 31, 2019, assuming the maximum number of shares under our performance-based awards will later be issued (which includes shares that could be issued over target related to performance awards issued and outstanding under the 2017 equity incentive plan), 7,538,712 shares remained available for future grants under this plan. The number of shares issued or reserved pursuant to the 2012, 2017 and 2019 equity incentive plans are subject to adjustment on account of a stock split of our outstanding shares, stock dividend, dividend payable in a form other than shares in an amount that has a material effect on the price of the shares, consolidation, combination or reclassification of the shares, recapitalization, spin-off, or other similar occurrences. Non-Vested Stock Awards We have issued non-vested stock awards, including restricted stock units and restricted shares, in our Class A common stock to certain of our employees, independent contractors and members of our board of directors. The following is a summary of the awards granted during the years ended December 31, 2019, 2018 and 2017.
| • | During the year ended December 31, 2019, we granted RSUs that are performance vesting in nature, with 888,726 reflecting the maximum number of RSUs that may be issued if all of the performance targets are satisfied at their highest levels, and 1,493,788 RSUs that are time vesting in nature.
| • | During the year ended December 31, 2018, we granted RSUs that are performance vesting in nature, with 1,014,269 reflecting the maximum number of RSUs that may be issued if all of the performance targets are satisfied at their highest levels, and 1,332,085 RSUs that are time vesting in nature.
| • | During the year ended December 31, 2017, we granted RSUs that are performance vesting in nature, with 1,458,033 reflecting the maximum number of RSUs that may be issued if all of the performance targets are satisfied at their highest levels, and 1,466,986 RSUs that are time vesting in nature.
Our annual performance-vesting awards generally vest in full three years from the grant date, based on our achievement against various adjusted income per share performance targets. Our time-vesting awards generally vest 25% per year over four years from the grant date. In addition, on December 1, 2017, we made a special grant of RSUs under our 2017 equity incentive plan (Special RSU grant) to certain of our employees, with 3,288,618 reflecting the maximum number of RSUs that may be issued if all of the performance targets are satisfied at their highest levels, and 939,605 RSUs that are time vesting in nature. During 2018 and 2019, we made additional grants under this Special RSU grant program to certain of our employees, with 195,907 reflecting the maximum number of RSUs that may be issued if all of the performance targets are satisfied at their highest levels, and 55,973 RSUs that are time vesting in nature. As a condition to this Special RSU grant, each participant has agreed to execute a Restrictive Covenants Agreement. Each Special RSU grant consisted of:
| (i) | Time Vesting RSUs with respect to 33.3% of the total number of target RSUs subject to the grant.
| (ii) | Total Shareholder Return (TSR) Performance RSUs with respect to 33.3% of the total number of target RSUs subject to the grant. The actual number of TSR Performance RSUs that will vest is determined by measuring our cumulative TSR against the cumulative TSR of each of the other companies comprising the S&P 500 on the Grant Date (the Comparison Group) over a six-year measurement period commencing on the Grant Date and ending on December 1, 2023. For purposes of measuring TSR, the initial value of our common stock was the average closing price of such common stock for the 60 trading days immediately preceding the Grant Date and the final value of our common stock will be the average closing price of such common stock for the 60 trading days immediately preceding December 1, 2023.
| (iii) | EPS Performance RSUs with respect to 33.3% of the total number of target RSUs subject to the grant. The actual number of EPS Performance RSUs that will vest is determined by measuring our cumulative adjusted income per share growth against the cumulative EPS growth, as reported under GAAP (GAAP EPS), of each of the other members of the Comparison Group over a six-year measurement period commencing on January 1, 2018 and ending on December 31, 2023.
The Time Vesting and TSR Performance RSUs subject to the Special RSU grants vest on December 1, 2023, while the EPS Performance RSUs subject to the Special RSU grants vest on December 31, 2023. We estimated the fair value of the TSR Performance RSUs referred to above on the date of the grant using a Monte Carlo simulation with the following assumptions:
|  | Year Ended December 31, |
|  |  | 2019 |  |  |  | 2018 |  |  |  | 2017 |
Volatility of common stock |  |  | 25.96 | % |  |  | 25.02 | % |  |  | 27.85 | %
Expected dividend yield |  |  | 0.00 | % |  |  | 0.00 | % |  |  | 0.00 | %
Risk-free interest rate |  |  | 2.12 | % |  |  | 2.73 | % |  |  | 2.33 | %
Lastly, on December 15, 2017, we granted 127,160 RSUs that are time vesting in nature to certain senior brokers. Such awards generally vest in full three years from the grant date. A summary of the status of our non-vested stock awards is presented in the table below:
|  | Shares/Units |  |  | Weighted Average Market Value Per Share |
Balance at December 31, 2016 |  |  | 4,843,273 |  |  | $ | 31.66 |
Granted |  |  | 5,152,082 |  |  |  | 40.11 |
Performance award achievement adjustments |  |  | 489,219 |  |  |  | 30.93 |
Vested |  |  | (2,510,031 | ) |  |  | 29.98 |
Forfeited |  |  | (297,441 | ) |  |  | 32.85 |
Balance at December 31, 2017 |  |  | 7,677,102 |  |  |  | 37.76 |
Granted |  |  | 2,023,266 |  |  |  | 45.70 |
Performance award achievement adjustments |  |  | 282,953 |  |  |  | 38.09 |
Vested |  |  | (2,177,800 | ) |  |  | 34.78 |
Forfeited |  |  | (623,161 | ) |  |  | 40.85 |
Balance at December 31, 2018 |  |  | 7,182,360 |  |  |  | 41.04 |
Granted |  |  | 2,000,977 |  |  |  | 50.07 |
Performance award achievement adjustments |  |  | 166,007 |  |  |  | 37.36 |
Vested |  |  | (1,323,351 | ) |  |  | 37.43 |
Forfeited |  |  | (316,294 | ) |  |  | 42.09 |
Balance at December 31, 2019 |  |  | 7,709,699 |  |  |  | 43.89 |
Total compensation expense related to non-vested stock awards was $127.7 million, $128.2 million and $93.1 million for the years ended December 31, 2019, 2018 and 2017, respectively. At December 31, 2019, total unrecognized estimated compensation cost related to non-vested stock awards was approximately $173.8 million, which is expected to be recognized over a weighted average period of approximately 2.9 years. Bonuses We have bonus programs covering select employees, including senior management. Awards are based on the position and performance of the employee and the achievement of pre-established financial, operating and strategic objectives. The amounts charged to expense for bonuses were $309.4 million, $363.6 million and $286.5 million for the years ended December 31, 2019, 2018 and 2017, respectively. 401(k) Plan Our CBRE 401(k) Plan (401(k) Plan) is a defined contribution savings plan that allows participant deferrals under Section 401(k) of the Internal Revenue Code (IRC). Most of our U.S. employees, other than qualified real estate agents having the status of independent contractors under section 3508 of the IRC of 1986, as amended, and non-plan electing union employees, are eligible to participate in the plan. The 401(k) Plan provides for participant contributions as well as a company match. A participant is allowed to contribute to the 401(k) Plan from 1% to 75% of his or her compensation, subject to limits imposed by applicable law. Effective January 1, 2007, all participants hired post January 1, 2007 vest in company match contributions 20% per year for each plan year they are employed. All participants hired before January 1, 2007 are immediately vested in company match contributions. For both 2019 and 2018, we contributed a 67% match on the first 6% of annual compensation for participants with an annual base salary of less than $100,000 and we contributed a 50% match on the first 6% of annual compensation for participants with an annual base salary of $100,000 or more (up to $150,000 of compensation). For 2017, we contributed a 50% match on the first 6% of annual compensation (up to $150,000 of compensation) deferred by each participant. In connection with the 401(k) Plan, we charged to expense $59.9 million, $46.3 million and $38.8 million for the years ended December 31, 2019, 2018 and 2017, respectively. Participants are entitled to invest up to 25% of their 401(k) account balance in shares of our common stock. As of December 31, 2019, approximately 1.3 million shares of our common stock were held as investments by participants in our 401(k) Plan. Pension Plans We have two contributory defined benefit pension plans in the U.K. The London-based firm of Hillier Parker May & Rowden, which we acquired in 1998, had a contributory defined benefit pension plan. A subsidiary of Insignia, which we acquired in connection with the Insignia Acquisition in 2003, also had a contributory defined benefit pension plan in the U.K. Our subsidiaries based in the U.K. maintain the plans to provide retirement benefits to existing and former employees participating in these plans. With respect to these plans, our historical policy has been to contribute annually to the plans, an amount to fund pension liabilities as actuarially determined and as required by applicable laws and regulations. Our contributions to these plans are invested by the plan trustee and, if these investments do not perform well in the future, we may be required to provide additional contributions to cover any pension underfunding. Effective July 1, 2007, we reached agreements with the active members of these plans to freeze future pension plan benefits. In return, the active members became eligible to enroll in a defined contribution plan. As of December 31, 2019 and 2018, the fair values of pension plan assets were $331.4 million and $274.4 million, respectively, and the fair values of projected benefit obligations in aggregate were $439.4 million and $387.4 million, respectively. As a result, the plans were underfunded by approximately $108.0 million and $113.0 million at December 31, 2019 and 2018, respectively, and were recorded as net liabilities included in other long term liabilities in the accompanying consolidated balance sheets. Items not yet recognized as a component of net periodic pension cost (benefit) were $191.6 million and $192.7 million at December 31, 2019 and 2018, respectively, and were included in accumulated other comprehensive loss in the accompanying consolidated balance sheets. Net periodic pension (benefit) cost was not material for the years ended December 31, 2019, 2018 and 2017.

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