- CBRE reported strong Q1 results, with revenue up 12% and earnings per share up 32%, but flagged growing concerns about the impact of tariff uncertainty on future business.
- CEO Bob Sulentic noted that while capital raising exceeded expectations early in the year, client caution tied to tariffs has begun to shrink project pipelines and slow corporate initiatives.
- Despite macroeconomic headwinds, CBRE’s industrial and office sectors showed resilience, with office space scarcity supporting demand even in smaller markets.
A Strong Start Tempered by Tariff Anxiety
CBRE’s first quarter of 2025 showcased robust performance, with $8.9B in revenue and a 29% increase in net income, as reported by Globe St.
The firm also raised nearly $5B during the quarter, well above projections. However, the mood shifted by quarter-end, as tariff uncertainties started to cloud the company’s growth outlook.
During CBRE’s earnings call, CEO Bob Sulentic acknowledged that initial enthusiasm had given way to signs of “choppiness,” especially as some global capital sources began pulling back from investments.
Capital Inflows Beat Expectations—For Now
Sulentic noted that CBRE’s early-quarter capital raising activity outperformed forecasts. Yet, as the quarter closed, market enthusiasm moderated back to earlier-year levels, largely due to concerns about escalating tariffs and potential recession risks.
He explained that tariffs were already influencing project management, with corporate clients beginning to delay larger initiatives.
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Office and Industrial Segments Hold Firm
While global volatility loomed, CBRE’s industrial segment performed as expected. Surprisingly, the office sector also showed resilience, bolstered by a shortage of high-quality Class A office space in gateway and secondary markets.
Sulentic said that companies continue to value office presence, with a gradual shift back to pre-pandemic usage patterns underway.
Echoes Across the Industry
CBRE’s cautious tone mirrors concerns raised by other major players. Blackstone CEO Stephen Schwarzman also flagged tariff-driven uncertainty, emphasizing that full impacts are still unfolding and will require patience from investors and operators alike.
What’s Next
As tariffs introduce new volatility into the commercial real estate landscape, CBRE and its peers are adjusting expectations. While fundamentals in sectors like industrial and office remain relatively strong, the coming quarters may test the industry’s resilience amid broader economic uncertainty.
