Brookfield Hands Over U.S. Office Property Management to CBRE
By Rebecca Baird-Remba January 17, 2024 3:30 pm
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Brookfield Properties is handing off its day-to-day property management to CBRE in the spring, Commercial Observer has learned.
Brookfield will continue to manage the cash flow and investment side of its properties, and it will keep an asset management team focused on making sure its investors get their returns. However, CBRE will handle the more run-of-the-mill management of a property that usually happens on-site, including accounting, procurement services and building technology, according to both companies.
Brookfield’s maintenance and operations staff will continue working the same jobs under the same supervisors in buildings across the country, but CBRE will become their employer when the partnership goes into effect April 2. Brookfield declined to discuss the financials of the deal or how many employees would now be employed by CBRE, but spokespeople for Brookfield said that it would not affect building workers in any way.
“The nature of our business has changed to being much more fund-driven,” said Greg Meyer, the president for the North American office of Brookfield Properties. “You’re not holding forever, but you need to have the ability to scale in and out of those assets, but without impacting employees unnecessarily.”
To avoid a turnover for employees when Brookfield decides to sell a property, the company decided to put the operations and day-to-day accounting of roughly 85 buildings across the country in CBRE’s hands, Meyer said.
The brokerage also has significantly more staff in many midsize cities than Brookfield, making it easier for them to handle properties outside of major hubs like New York and Chicago, according to Meyer.
Brookfield will continue to handle long-term financial planning and analysis for its buildings, but CBRE will take over tasks such as monthly financial reporting, accounts payable and accounts receivable. It will mark the launch of a new property management business that CBRE has dubbed “Investor Portfolio Management.”
CBRE has about 7 billion square feet of commercial real estate under management across the globe, and it will fold Brookfield’s 65 million-square-foot portfolio into that business.
“We are preserving the structure of the Brookfield team by operating this business in a vertical structure,” said Emma Buckland, CBRE’s global president for property management. She added that the buildings will be branded as Brookfield Properties operated by CBRE.
CBRE also plans to bring its own tech investments to the table, including Pulse, its in-house property management software; Deepki, its emissions and utilities tracker aimed at making buildings more sustainable; and leasing management platform VTS.
Rebecca Baird-Remba can be reached at rbairdremba@commercialobserver.com.
