Leasing Bump Buoys Brokerages As Fading Hope For Rate Cuts Sinks Sales

An increasingly active office market helped the publicly traded commercial real estate brokerages post largely positive first-quarter results, although the firms` leaders pointed out that an expected return of capital markets activity has again been delayed.

CBRE posted a $126M profit, leading the pack ahead of $66M in net income from JLL and $43.3M from Colliers. Newmark and Cushman & Wakefield both reported losses of around $29M.

Executives at the major brokerages said leasing volume is trending positively, lifting a slowdown in the capital markets space that they expect to reverse by year`s end.

“As the world moves on from the pandemic and as interest rates stabilized — that doesn`t mean they go up or down, it just means they stabilize — people will resume to normal course transactions,” said Alexander Goldfarb, managing director of research at Piper Sandler who analyzes Newmark’s performance....

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RSK: This is good for brokerages but it doesn`t mean vacancy rates are decreasing. Many companies are downsizing but yet a lease is struck, generating commission but less space.