LOS ANGELES-CBRE Group Inc. has completed its $540 million purchase of Amsterdam-based ING Group’s real estate investment management operations in Europe. CBRE has now spent about $900 million on ING assets, including the Asia management operations and ING’s Clarion Real Estate Securites business, bringing total CBRE assets under management to about $94.8 billion.
The ING REIM business, as well as ING Real Estate Select, is to be merged with CBRE. The combined firm will operate as CBRE Global Investors, based here. Matt Khourie will serve as global president and his team will comprise executives of both firms, including Peter Hendrikse, now CEO of EMEA; Richard Price, CEO of Asia Pacific, T. Ritson Ferguson, CEO of global securities and Jeremy Plummer, CEO of global multi-management.
Brett White, CEO of CBRE, said in a statement that this purchase will provide another source of stable revenue for the company. “We have completed the most transformative transaction in our industry since our purchase of Trammell Crow Co. in 2006,” he said.
As part of the transaction, CBRE will also acquire up to $75 million of real estate co-investments managed by ING REIM in Europe. This is in addition to co-investments of about $75 million that CBRE took on with the other two ING acquisitions.
CBRE said in a statement Monday that financed the Europe purchase with a combination of cash on hand and borrowings under a secured credit facility, including $800 million of bank debt raised for this purpose in March 2011. The company plans to discuss this deal in a conference call at 5 p.m. Tuesday.
Jan Hommen, CEO of ING Group, said Monday that the divestment of ING REIM fits his firm’s strategic objectives of reducing exposure to real estate, simplifying the company and further strengthening the capital base. ING Real Estate Finance and ING Real Estate Development are not impacted by the divestment of ING REIM.
The divestment of ING REIM has resulted in an after-tax gain on disposal of approximately $644 million and a capital release of around $713 million.
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