CBRE Group, the world’s largest property services firm, has finalised its acquisition of ING Group's real estate investment management (ING REIM) operations in Europe, completing its protracted takeover of the Dutch banking group's real estate fund management businesses.
The $540 million transaction is the final piece of CBRE's wider takeover of ING REIM's Asian, European and US-based real estate securities businesses, which will eventually cost the Los Angeles-based firm about $1.2 billion. That total cost includes $75 million for co-investments in Europe, $75 million for co-investments in Asia and the US, and $150 million in “financing, integration and retention” costs, the transactions of which are to complete shortly.
CBRE financed the acquisition with a combination of cash on hand and borrowings under its secured credit facility, including $800 million of bank debt, raised specifically for this purpose in March.
The three platforms are being merged with CBRE's own real estate investment management business, CBRE Global Investors, effectively transforming it into the largest real estate investment management platform in the world with total assets under management valued at $94.8 billion as of 30 September.
Brett White, chief executive officer of CBRE, said in a statement: “Our expanded investment management business will enhance our service offerings for institutional investors in commercial real estate and provide us with another source of stable revenues.”
CBRE's takeover of ING's real estate platforms was originally announced in February. The firm finalised its acquisition of ING REIM Asia on 3 October and completed its takeover of ING's US-based global real estate securities business, ING Clarion Real Estate Securities, on 1 July.
“The divestment of ING REIM fits our strategic objectives of reducing exposure to real estate, simplifying our company,” said Jan Hommen, CEO of ING Group. According to a statement from ING, the firm's other real estate businesses, ING Real Estate Finance and ING Real Estate Development, are not impacted by this transaction.
The 1,100-strong CBRE Global Investors team, led by global president Matt Khourie, is now overseen by senior executives from both CBRE Investors and ING REIM. Pieter Hendrikse, former CEO of ING REIM Europe, has been appointed CEO of European, Middle Eastern and African operations. Richard Price, who served as ING REIM's Asia leader, will now serve as CEO of the combined company's Asia Pacific investment management platform. T. Ritson Ferguson, former chief investment officer and portfolio manager for Clarion’s operations, is now CEO of the global securities business. Meanwhile, Jeremy Plummer, former managing director of CBRE Investors' Global Multi Manager, has been named CEO of the combined global multi-manager business.