CBRE-Excellerate JV to target expansion into new territories

THE PLANNED joint venture between New York Stock Exchange listed commercial real estate services company CBRE and South African-based Excellerate Property Services aims to initially focus on growth and the expansion of their service offering, and into new territories.

CBRE and Excellerate announced in December that they had agreed to form a joint venture.

Gordon Hulley, chief executive of Excellerate Holdings, said yesterday that the targeted kick-off date for the joint venture was April 1, but they were still waiting for Competition Commission approval and other anti-trust approvals in certain territories.

“So we are very much in the planning stage and subject to those approvals,” he said.

CBRE has 480 offices across 110 countries, 80 000 employees and had $337.6 billion (R4.63 trillion) in transaction activity last year, while Excellerate has more than 30 offices throughout Africa, the Middle East and UK, employs 24 000 people and has about $12.6bn in assets under management.

Hulley said Excellerate had given notice on its agreement with Cushman & Wakefield, with this affiliation ending at the end of May this year.

He said in terms of the joint venture, the Excellerate Group in South Africa would maintain a 51 percent shareholding, which facilitated it retaining its Level 1 empowerment scorecard rating, while in the rest of Africa CBRE would hold 51.9 percent.

“In substance, it’s two joint ventures,” he said.

Tony Brearley, the president of growth and emerging markets for Global Workplace Solutions for CBRE, said he was responsible for regions that included the Middle East and Africa, the Nordics, South East Mediterranean, Eastern Europe and Iberia.

Brearley said the markets where CBRE was already established and where it was looking to invest were fast growing markets, which had prompted the agreement with Excellerate.

He said the joint venture would be known as CBRE Excellerate and had been formed to meet the growing demand for high quality real estate services from international corporations operating in Africa and the Middle East.

Excellerate would retain its soft services, such as security, property care, canteen and parking, and investor services that included its property management divisions, which would not form part of the joint venture.

Brearley said the planned joint venture would join a regional leader with a global leader and act as a primary provider in the African and Middle East market.

He said the benefits of the joint venture for customers was that it would expand its global reach, improve its ability to advise on every stage of the property lifecycle and enable it to offer a full range of real estate services.

Marna van der Walt, the chief executive of Excellerate Property Services, said the company had grown substantially over the past five years and their vision was aligned with CBRE’s aspirations.

“We have coverage in the rest of Africa with a great aspiration to grow into North Africa and the Middle East. This opportunity gave us a partner and an opportunity to really establish ourselves and focus on the rest of the region.”