CBRE Group, Inc. CBG is on an acquisition spree. The company recently announced the acquisition of Seattle-based Tax Credit Group (TCG) for an undisclosed amount. TCG is a leading provider of advisory, investment sales, debt and structured finance, and research services to owners of Affordable Housing.
Apart from the addition of affordable housing services to CBRE’s Capital Markets business line, the TCG acquisition brings the expertise of its leader, Robert Sheppard and his team to CBRE’s platform. The acquired business has been named CBRE Affordable Housing.
We view this acquisition as a strategic move that gives CBRE the opportunity to deliver investment sales, debt and structured finance, investment banking and valuation services to investors in the affordable housing industry.
Only last month, CBRE disclosed the acquisition of Forum Analytics, LLC. The commercial real estate services and investment firm is expected to benefit considerably from Forum’s modeling and mapping solutions. The Forum acquisition came on the heels of its takeover of Sitehawk Retail Real Estate, a leading retail real estate services firm based in Indianapolis.
CBRE continues to expand into new verticals and regions through strategic in-fill acquisitions as well as large, transformational deals such as that of Norland. In fact, CBRE accomplished 11 in-fill acquisitions in 2014 and 4 in-fill acquisitions in the first nine months of 2015.
Notably, in third-quarter 2015, CBRE acquired Global Workplace Solutions, a move that is expected to enhance contribution from its occupier outsourcing business line. On the whole, as market conditions continue to improve, we believe that such opportunistic acquisitions would supplement the company’s organic growth strategy.
Going forward, we believe that CBRE will benefit from its strategic in-fill acquisitions, transformational deals, improved leasing, property sales and outsourcing business. Yet, uncertainties in certain global economies, stiff competition and unfavorable foreign currency movements remain concerns.
CBRE currently has a Zacks Rank #2 (Buy). Reflecting its solid growth potential, the stock has a Zacks Growth Style Score of ‘B’. According to our style score system, a stock with a favorable Zacks Rank and Zacks Growth Style Score of ‘A’ or ‘B’ is highly desirable.
Other Stocks to Consider
Other well-ranked stocks in the real estate space include Henderson Land Development Co. Ltd. HLDCY, Jones Lang LaSalle Inc. JLL and Reis, Inc. REIS. All three stocks carry a Zacks Rank #2.
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