The Irish division of the international property giant CBRE plunged into the red last year with pre-tax losses of €4.57m (£3.82m).
In its annual return CBRE Ireland claimed revenues for 2012 had tumbled by 34 per cent to €7.5m (£6.27m), prompting a pre-tax loss after booking an onerous lease provision of €2.56m (£2.14m) and a restructuring charge of €109,205 (£91,385). The losses follow a 2011 pretax profit of €196,396 (£164,348).
The firm paid no dividend in 2012 after paying out €17.5m (£14.6m) in 2011. It also recorded an operating loss of €1.99m (£1.66m) before exceptional items, following a loss of €323,055 (£270,339) under the same heading in 2011.
A directors’ report blamed market conditions and a weak domestic economy for the loss, adding that there had been an improvement in market activity during the current year.
“The second half of the year saw a modest level of improvement in market conditions. To date, 2013 has seen a significant improvement in activity levels for domestic property transactions caused by improved national and international perceptions of the Irish commercial property market, an emerging real estate investment trust market, the imminent ending of the IMF intervention in Ireland and the arrival of a number of influential foreign-based funds,”
Attempting to minimise the losses the company had, during 2012, maintained rigorous cost control and invested significant resources in developing key profit making areas of the business such as building consultancy, property and asset management.
Staffing levels throughout 2013 have been steadily rising, says the report, “in line with an improvement in business levels across the board”. Staff numbers last year declined from 121 to 88 with staff costs down to €6.1m (£5.1m) from €7.96m (£6.66m) in 2011.
Last year’s loss reduced the firm’s shareholder funds from €4.4m (£3.6m) to €84,532 (£70,738), with directors’ remunerations cut by two-thirds to €650,587 or just over £544,000.
CBRE is the world’s largest commercial real estate firm with over 300 offices in more than 50 countries. Its Irish division has offices in Dublin and Belfast and, like its global partners, offers the full range of property services from sales and leasing, and project and development management, to corporate research and consulting.
Less than 24 hours after posting its negative return CBRE Ireland’s managing director, Enda Luddy, was upbeat about his division’s future. “This year has been a very strong year for the Irish commercial property market with recovery now evident in each sector of the market and a marked improvement in transaction volumes across all sectors,” said Luddy in his bi-monthly report.
“At this stage in the year the focus would normally be on getting transactions closed by year-end but such is the weight of demand for prime real estate at present, we are continuing to see new properties and portfolios being released for sale even at this late stage in the year”.
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