Cushman & Wakefield Sees Stronger Leasing in Q3 But Still Faces Obstacles

Cushman & Wakefield (CWK) saw stronger leasing and revenue growth during the third quarter of 2024 compared to last year, but the global real estate services firm isn’t totally out of the woods just yet.

C&W reported revenue of $2.3 billion during the third quarter, a 3 percent increase from the same period in 2023, according to the company’s third-quarter earnings report released Monday.

Meanwhile, leasing grew 13 percent during the third quarter, driven largely by major industrial and office leases and marking the fourth consecutive quarter of global leasing fee revenue growth for the brokerage, the report found. The Americas region alone saw a 16 percent increase in leasing, C&W said.

“This quarter marked an important turning point,” C&W CEO Michelle MacKay said in a statement Monday. “The strategic work we have completed over the past year has created meaningful growth opportunities for our business, and we are energized to deliver on these priorities in the years ahead.”

However, MacKay said during a Monday evening earnings call that the firm is still on a “gradual recovery” from the poor earnings it reported earlier this year.

During the second quarter of 2024, C&W posted an annual revenue decline of 5 percent, following a 3 percent drop in the first quarter and a 6 percent drop in the final quarter of 2023, as Commercial Observer previously reported.

This past quarter, C&W said it saw a decline in project management — primarily in multifamily developments — as many of its clients’ projects and renovations were either delayed or canceled due to a “more subdued market,” said Neil Johnston, chief financial officer at C&W.

“It really is just a function of a more subdued market, but we feel like the tide is turning there,” Johnston said during the call. “We are focused in that area, but we’ve just seen some projects that have been canceled. We feel confident going forward, and we’re starting to see those pipelines build and projects get executed.”

The firm’s services and capital markets business lines also declined 2 percent and 4 percent, respectively, from the third quarter of 2023, according to the report. In addition, C&W reported revenue of $6.8 billion for the nine months ending Sept. 30 — a 2 percent decrease from the same nine-month period in 2023.

MacKay said during the call that the company is working toward more positive numbers by focusing on “strong cash flow conversion” and making “targeted investments” to increase revenue opportunities.

Plus, the Federal Reserve’s anticipated rate cuts in November and December are also expected to “help some deals across the finish line,” MacKay added.

Isabelle Durso can be reached at idurso@commercialobserver.com.