CBRE GROUP, INC. | 2013 | FY | 3


9. Investments in Unconsolidated Subsidiaries

 

Investments in unconsolidated subsidiaries are accounted for under the equity method of accounting and include the following (dollars in thousands):

 

     December 31,  
     2013      2012  

Global Investment Management

   $ 99,714       $ 131,750   

Development Services

     76,791         53,435   

Other

     22,191         21,613   
  

 

 

    

 

 

 
   $ 198,696       $ 206,798   
  

 

 

    

 

 

 

 

The results for the year ended December 31, 2011 include the activity of equity investments acquired from and co-investments made in connection with the ING REIM Asia and ING REIM Europe acquisitions from October 3, 2011 and October 31, 2011, respectively, the dates each respective business was acquired. Combined condensed financial information for the entities accounted for using the equity method is as follows (dollars in thousands):

 

Condensed Balance Sheets Information:

 

     December 31,  
     2013     2012  

Global Investment Management:

    

Current assets

   $ 1,148,658      $ 1,139,867   

Non-current assets

     12,546,920        13,353,456   
  

 

 

   

 

 

 

Total assets

   $ 13,695,578      $ 14,493,323   

Current liabilities

   $ 1,034,040      $ 1,337,944   

Non-current liabilities

     4,705,551        5,538,066   
  

 

 

   

 

 

 

Total liabilities

   $ 5,739,591      $ 6,876,010   

Development Services:

    

Real estate

   $ 1,372,379      $ 1,165,166   

Other assets

     109,328        88,067   
  

 

 

   

 

 

 

Total assets

   $ 1,481,707      $ 1,253,233   

Notes payable on real estate

   $ 569,023      $ 473,704   

Other liabilities

     134,809        173,492   
  

 

 

   

 

 

 

Total liabilities

   $ 703,832      $ 647,196   

Other:

    

Current assets

   $ 56,359      $ 71,708   

Non-current assets

     37,226        43,401   
  

 

 

   

 

 

 

Total assets

   $ 93,585      $ 115,109   

Current liabilities

   $ 33,791      $ 43,557   

Non-current liabilities

     14,335        24,190   
  

 

 

   

 

 

 

Total liabilities

   $ 48,126      $ 67,747   

Non-controlling interests

   $ (183   $ 17,187   

Assets

   $  15,270,870      $  15,861,665   

Liabilities

   $ 6,491,549      $ 7,590,953   

Non-controlling interests

   $ (183   $ 17,187   

 

Condensed Statements of Operations Information:

 

     Year Ended December 31,  
     2013     2012     2011  

Global Investment Management:

      

Revenue

   $ 874,875      $ 833,343      $ 614,684   

Operating loss

   $ (241,829   $ (161,966   $ (149,519

Net (loss) income

   $ (26,075   $ 64,696      $ 70,551   

Development Services:

      

Revenue

   $ 70,343      $ 97,084      $ 123,865   

Operating income

   $ 130,873      $ 63,472      $ 118,995   

Net income

   $ 129,563      $ 38,720      $ 87,204   

Other:

      

Revenue

   $ 160,858      $ 163,365      $ 163,109   

Operating income

   $ 28,352      $ 21,755      $ 23,880   

Net income

   $ 28,422      $ 23,223      $ 24,695   

Total:

      

Revenue

   $ 1,106,076      $ 1,093,792      $ 901,658   

Operating loss

   $ (82,604   $ (76,739   $ (6,644

Net income

   $ 131,910      $ 126,639      $ 182,450   

 

During the years ended December 31, 2013, 2012 and 2011, we recorded non-cash write-downs of investments of $4.1 million, $3.9 million and $5.6 million, respectively, within our Global Investment Management and Development Services segments (see Note 5), all of which were included in equity income from unconsolidated subsidiaries in the accompanying consolidated statements of operations.

 

Our Global Investment Management segment involves investing our own capital in certain real estate investments with clients. We have provided investment management, property management, brokerage and other professional services in connection with these real estate investments on an arm’s length basis and earned revenues from these unconsolidated subsidiaries of $252.6 million, $190.0 million and $104.0 million during the years ended December 31, 2013, 2012 and 2011, respectively.

 

Our Development Services segment has agreements to provide development, property management and brokerage services to certain of our unconsolidated development subsidiaries on an arm’s length basis and earned revenues from these unconsolidated subsidiaries. Revenue related to these agreements included in our results for the years ended December 31, 2013, 2012 and 2011 was $17.5 million, $21.2 million and $5.7 million, respectively.


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