Message to shareholders
At Colliers, we are enterprising.
We set ambitious growth plans, attract and develop industry leaders and accelerate success for our clients and shareholders. Our people are passionate, take personal responsibility and always do what’s right. Our entrepreneurial culture is truly unique and reinforced by the fact that our leadership team owns more than 40% of the equity in our company, significantly more ownership than any of our global competitors.
In 2015, we established an ambitious five-year growth plan to double the size of our company by 2020. I am pleased to say we are finished year three of our five-year plan, and we remain on track to achieving this goal. As importantly, we continue to see more growth opportunities today than at any other point in our history.
2018 was a defining year for Colliers. We established a new Investment Management platform with the acquisition of Harrison Street Real Estate Capital, a pioneer in demographic-based investing with a proven track record of delivering best in class returns. We also completed 11 additional acquisitions including five in the Americas, four in EMEA and two in Asia Pacific, strengthening our services business across our global platform.
This solidifies Colliers’ place as the world’s fastest growing global real estate services and investment management company. To continue our strong momentum, Dylan Taylor has assumed the role of CEO, Colliers Real Estate Services while I remain responsible for overall strategy and execution across all our business. Dylan’s appointment recognizes his success in building our operations over the past decade. By strengthening our already strong foothold in the industry and adding another core engine for growth, Colliers is in a perfect position to continue capitalizing on opportunities for the future while generating superior returns for its shareholders.
Over the past 24 years, our leadership team has delivered more than 19% compound annual returns. This record of performance is unique in our industry and speaks volumes about our ability to maximize the potential for growth and create value for our shareholders over the long-term.
Here are some of our highlights from 2018:
- Colliers made excellent progress increasing recurring earnings and further diversifying revenue streams, creating greater stability to our overall business. Currently about 75% of our earnings come from recurring or repeat revenue streams and geographically, 59% of our revenues come from the Americas with the remainder split evenly between Europe and the Asia Pacific.
- In April, we expanded our revolving credit facility to $1 billion, improving our pricing and extending the term until 2023. Then in May, we reinforced our balance sheet further through the issuance of €210 million of senior unsecured notes, with a ten-year term and a fixed interest rate of 2.23%. Both issuances provide us with additional capacity to grow as we continue executing on our strategic growth plan.
- Just after year-end, we completed another significant acquisition, the market leader in Virginia with more than 340 professionals. This addition further strengthens our rapidly growing U.S. business, particularly our operations in the Mid-Atlantic region.
What sets Colliers apart is not what we do, but how we do it. One of the ways we foster our culture is through our employee engagement process. It focuses on collecting and analyzing employee feedback, cascading insights and top grading our teams across the entire organization. In 2018, we were recognized as Aon Best Employers in Canada and Australia and we received the prestigious HR Asia Award in Greater China. While we value these accolades, what’s important is the rigour we place around achieving best-in-class people practices across our company. We are proud of our enterprising culture that empowers our people to do their best work, maximize every opportunity and lead the industry.
Being enterprising around technology is another important ingredient to our success. Our strategy is to invest in technologies that enable our professionals to deliver smarter, more personalized and value-added service to clients whether by streamlining processes, improving effectiveness or enabling better decision-making. We are mid-way through a global initiative to elevate our web presence, drive consistency and improve functionality and perhaps most importantly, the user experience. Furthermore, our proprietary Colliers 360 for corporate users, Colliers Office Expert for occupiers and tenants, Colliers Indsite for industrial users and ColliersCRM for our advisors are a few more examples of our strategy in action.
We also believe we can gain incremental value and new insights from early-stage technology opportunities. In 2018, we launched the first global Colliers Proptech Accelerator in partnership with Techstars, a world leader in building accelerators and investing in early-stage technologies. More than 150 mentors worked closely with our first ten cohort companies sourced from around the world, culminating in final presentations to an audience of more than 600 Colliers clients, professionals, real estate industry leaders and technology investors. Each company continues to work on its business plan, including raising additional funds for development. Last month we formally launched the 2019 program as we continue seeking early insights into the best, even potentially industry disrupting, technologies that will accelerate success for our clients and people in the future.
The Colliers business is stronger today than ever, particularly with the addition of our new investment management platform, which gives us another engine for growth, substantially higher margins and significantly more recurring earnings. In 2019, I am optimistic that we will achieve another year of success toward our 2020 plan, continuing our long track record of success and keen focus on enhancing our highly respected brand and global platform that has become among the best in the industry.
I would like to thank our business leaders, professionals and employees for their enterprising work over the past year. Together, we take pride in building upon our strong foundation as we continue to write the story of Colliers International.
Jay S. Hennick
Global Chairman & CEO