CBRE Group Inc

Greetings and welcome to the CBRE's Q1 2022 earnings conference call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. I would now like to turn this conference over to your host, Ms. Kristen Fairman, Senior Vice President, Investor Relations and Strategic Finance, Thank you, ma'am. You may begin your presentation.

Good morning, everyone, and welcome to CBRE's first quarter 2022 earnings conference call. Earlier today, we issued a press release announcing our financial results, which is posted on the investor relations page of our website, CBRE.com, along with a presentation slide deck that you can use to follow along with our prepared remarks, as well as an Excel file that contains additional supplemental materials. Before we kick off today's call, I'll remind you that this presentation contains forward-looking statements that involve a number of risks and uncertainties. Examples of these statements include our expectations regarding CBRE's future growth prospects, including our 2022 qualitative outlook, operations, market share, capital deployment strategy and share repurchases, financial performance, including net leverage, profitability, expenses, and effective tax rates, the business environment and the effects of the COVID pandemic and geopolitical tensions, the integration and performance of acquisitions and other transactions, and any other statement regarding matters that are not historical fact. We urge you to consider these factors and remind you that we undertake no obligation to update the information contained on this call to reflect subsequent events or circumstances. You should be aware that these statements should be considered estimates only and certain factors may affect us in the future and could cause actual results to differ materially from those expressed in these forward-looking statements. For a full discussion of the risks and other factors that may impact these forward-looking statements, please refer to this morning's earnings release and our most recent annual and quarterly reports filed on Form 10-K and Form 10-Q, respectively. We have provided reconciliations of consolidated adjusted EBITDA, core EPS, core EBITDA, net revenue, and certain other non-GAAP financial measures included in our remarks to the most directly comparable GAAP measures, together with explanations of these measures in the appendix of the presentation slide deck. Our agenda for this morning's call will be as follows. Bob Cilentic, our president and CEO, will briefly comment on first quarter highlights and the role that our four-dimension diversification strategy and balance sheet are playing in driving our growth. Then Emma Giammartino, our Chief Financial and Investment Officer, will discuss the quarter in detail and our updated qualitative 2022 outlook. Then we'll open up the call for questions. Please note that we are now referring to Core Adjusted EPS as Core EPS for simplicity purposes. Additionally, we are also reporting Core EBITDA, which, like Core EPS, is equivalent to Adjusted EBITDA that excludes the fair value adjustments related to non-core investments. Now, please turn to slide six as I turn the call over to Bob.

Thank you, Kristen, and good morning, everyone. The year has started out strong for CBRE with excellent momentum across all three business segments. Globally, net revenue increased more than 30% and GAAP EPS and core EPS were up 48% and 72% respectively in the first quarter. We saw strong property sales growth in virtually every corner of the world. Office and retail continued to rebound nicely from COVID suppressed levels and multifamily and industrial maintained strong momentum. The continued rebound in leasing velocity is also encouraging. Notably, office leasing revenues surpassed Q1 2019 levels in both EMEA and Asia Pacific. Office activity in the U.S. improved significantly, but remained below pre-pandemic levels. Despite the lag in U.S. office, overall global leasing revenue is 20% above the Q1 2019 peak. We achieved these strong revenue gains while keeping expense growth in check, which is a top priority for us. Our core EBITDA margin on net revenue improved 280 basis points over the prior year quarter. Notably, discretionary expenses were 27% below first quarter 2019 levels, while net revenue was up 42% versus the same period. We continue to execute a strategy to diversify our business both organically and through investment broadly across the four dimensions we've talked about regularly over the last couple years. Asset types, lines of business, clients, and geographies. Our performance for the quarter drives home how effectively this strategy is working. We saw continued gains from the purposeful investments we have been making in parts of our business that are benefiting from enduring growth trends. Examples include the industrial and multifamily asset classes, which we invest in and serve broadly, our local facilities management and our project management lines of business, and several of our geographies, particularly North Asia, where we continue to see strong growth. Notably, Turner and Townsend continues to perform ahead of our expectations, both financially and operationally, and we are enthusiastic about the added dimensions they bring to our global project management offering, particularly in infrastructure, natural resources, and sustainability services. We generate significant cash that is being strategically deployed into growth areas of our business while we are also returning cash to shareholders at an elevated clip. Year to date, share repurchases have totaled $627 million. I'll close with a word about Ukraine, which I know is top of mind for many of you. In early March, we decided to exit most of our business in Russia while keeping some employees in that country to manage facilities for multinational clients consistent with our contractual obligations. We are inspired by the Ukrainian people's brave resistance to Russia's unprovoked aggression. With that, I'll turn the call over to Emma, who will discuss the quarter and the outlook.