- Office leasing in the Americas shot up by 32%, revealing a strong rebound in back-to-office activity.
- Colliers reported 6% YoY revenue growth, with leasing revenues up 13%, driven by the office and industrial sectors.
- The capital markets division grew for the first time since 2Q22, despite flat revenue.
- The $475M acquisition of Englobe aims to bolster Colliers’ engineering and project management services.
Colliers International (CIGI) reported a robust Q2, marked by a 32% spike in office leasing activity across the Americas.
This deal surge contributed to 6% more Q2 revenue on a YoY basis, as reported in Bisnow. The company’s stock reflected this optimism, closing up more than 5.6% for the day.
Strong Leasing Activity
Office leasing in the Americas surged by 32% in the last quarter, indicating a clear return-to-office trend. The industrial leasing sector also showed significant growth, up by 11% over the same period.
Colliers CEO of Real Estate Services, Chris McLernon, highlighted the strong performance across all service lines and segments, driven by increased business confidence among occupiers.
Revenue And Earnings
Specifically, Colliers reported total revenue of $1.1B for Q2, with earnings per share of $1.36, narrowly missing the Zacks consensus estimate of $1.37 per share.
The company’s net earnings for the quarter were $72M, up significantly from $35M in the same period last year. Revenue in the Americas totaled $683M, up 8% YoY, fueled by strong leasing and growth in outsourcing and advisory services.
Strategic Acquisitions
Last month, Colliers acquired Englobe, an engineering, environmental, and inspection services platform, for $475M. This acquisition is expected to enhance Colliers’ engineering and project management services, particularly in Canada, where the cost of labor is lower.
Global CEO Jay Hennick stated that this purchase aligns with Colliers’ strategy of doubling down on high-value recurring revenue streams, which now represent 72% of overall earnings.
Why It Matters
For the first time since 2Q22, Colliers saw meaningful growth in its capital markets business, although quarterly revenue remained flat at $183M compared to the previous year.
Hennick expressed optimism about the segment’s future, anticipating a full return to annual growth driven by lower interest rates, increased debt availability, and narrowing bid-ask spreads.
