The strong earnings growth was achieved despite a $32.9 million increase in interest expense associated with the financing of the Trammell Crow Company acquisition and the exclusion of $8.4 million of gains from Development Services activities, which cannot be recognized under purchase accounting rules.

Management's Commentary

"Third quarter results clearly showed the economic and strategic benefits of our highly diversified business line and revenue base. During a period of extremes in the global credit markets as well as uneasiness about the U.S. economy generally, CBRE posted very impressive year over year gains in both revenue and profitability.

These gains were ahead of our internal projections and support our view of achieving full year guidance," said Brett White, President and Chief Executive Officer of CB Richard Ellis. "Our professionals, supported by the industry's most extensive global platform and most admired brand, continue to fashion innovative solutions that enable us to expand our range of services for clients and build market share.

"Our success was evident throughout the world last quarter, most notably in the international marketplace. In Europe, we continue to realize the benefits of the fully integrated service offering that we have rolled out across the continent as the region's preeminent full-service commercial real estate services provider. Asia Pacific remains our fastest-growing geography, and our increased investments in countries like China, Japan and Australia have produced noteworthy returns. Global Investment Management also continues to perform exceptionally well, both by harvesting gains on property sales and growing assets under management.

"In the Americas, we benefited from the acquisition of Trammell Crow Company combined with organic revenue gains. Investment sales activity showed solid growth despite a pullback in property valuations, reduced availability of debt financing for larger asset sales, and tighter underwriting standards. We expect the changed market conditions to have more of an impact on our investment sales performance in the fourth quarter. While non-U.S. leasing performance was quite strong, U.S. leasing results were affected by uncertainty surrounding domestic economic growth, and the generally slower pace of activity in selected markets. However, office and industrial leasing market fundamentals remain positive, with higher rents, flat-tolower vacancies and continued absorption.

"Meanwhile, the integration of the Trammell Crow Company has enabled us to sharply expand our fee-based services for Global Corporate Services clients. Revenues associated with outsourcing have increased to 23% of total revenues in the third quarter of 2007 from 14% in the year ago quarter. This provides a steady source of revenues that strongly complements our transaction-based businesses."

Since the beginning of the year, CB Richard Ellis has added 24 new corporate outsourcing accounts, expanded its service offering with 12 existing corporate clients, and renewed its relationship with 14 others. Recent notable account additions and expansions/renewals in our corporate outsourcing business include Chrysler Corporation, McKesson Corporation, Fifth Third Bank and Diageo.

Third Quarter Highlights

For the third quarter of 2007, the Company generated revenue of $1.5 billion, up 54.2% over the $967.9 million posted in the third quarter of 2006. Strong growth globally drove the Company's performance for the quarter. The Company reported net income of $114.9 million, or $0.48 per diluted share, in the third quarter of 2007 compared with net income of $92.3 million, or $0.39 per diluted share, in the third quarter of 2006.

Excluding one-time items, the Company would have earned net income2 of $130.2 million, or $0.55 per diluted share, in the third quarter of 2007, an increase of 37.8% and 37.5%, respectively, compared with net income of $94.5 million, or $0.40 per diluted share, in the third quarter of 2006.

Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA)3 totaled $239.9 million for the third quarter of 2007, an increase of $76.4 million, or 46.7%, from the same quarter last year despite the inclusion of $14.8 million4 of acquisition-related expenses.

The integration of Trammell Crow Company is continuing to progress well and as previously announced, is ahead of schedule with regard to the timing and attainment of synergy savings. The Company is still forecasting annualized net expense synergy savings of approximately $90 million, and expects to realize about 60% of those savings in calendar year 2007.

In line with the Company's strategy to reduce debt, the Company repaid $152.8 million of its senior secured term loans in the third quarter of 2007. The Company expects to achieve annual cash interest savings of nearly $20 million as a result of its de-leveraging efforts to date in 2007.

Nine-Month Results

Revenue was $4.2 billion for the nine months ended September 30, 2007, up $1.6 billion, or 60.0%, compared to the same period last year. The Company reported net income of $268.1 million, or $1.13 per diluted share, for the nine months ended September 30, 2007 compared to net income of $193.5 million, or $0.83 per diluted share, in the same period last year.

Excluding one-time items, the Company would have earned net income of $352.5 million, or $1.49 per diluted share, for the nine months ended September 30, 2007, up 64.9% and 63.7%, respectively, over net income of $213.8 million, or $0.91 per diluted share, for the nine months ended September 30, 2006.

EBITDA was $576.4 million for the nine months ended September 30, 2007, up $183.3 million or 46.6% compared to the same period last year despite the inclusion of $107.8 million5 of acquisition-related expenses.

The strong earnings growth was achieved despite an $89.8 million increase in interest expense associated with the financing of the Trammell Crow Company acquisition and the exclusion of $21.0 million of gains from Development Services activities, which cannot be recognized under purchase accounting rules.

Third-Quarter Segment Highlights

Americas Region

Third quarter revenue for the Americas region, including the U.S., Canada, Mexico and Latin America, increased 46.3% to $914.7 million, compared with $625.4 million for the third quarter of 2006. This increase was attributable to the combination of acquisitions, particularly the Trammell Crow Company acquisition, and organic revenue growth.

Operating income for the Americas region totaled $102.4 million for the third quarter of 2007, compared with $87.9 million for the third quarter of 2006. Excluding the impact of one-time items, operating income for the Americas region would have been $125.2 million for the third quarter of 2007, an increase of $34.6 million, or 38.2%, as compared to $90.6 million for the third quarter of last year. The Americas region's EBITDA totaled $126.2 million for the third quarter of 2007, an increase of $25.0 million from last year's third quarter despite the inclusion of $13.4 million6 of acquisition-related expenses.

EMEA Region

Revenue for the EMEA region increased 49.5% to $320.2 million for the third quarter of 2007, compared with $214.2 million for the third quarter of 2006. This revenue increase reflects the growing strength of the Company's platform across most business lines, particularly in the United Kingdom, France, Spain and Germany.

Operating income for the EMEA segment totaled $66.0 million for the third quarter of 2007, compared with $35.1 million for the same period last year. Excluding the impact of one-time items, operating income for the EMEA region would have been $67.4 million for the third quarter of 2007, an increase of $31.9 million, or 89.7%, from the third quarter of last year. EBITDA for the EMEA region totaled $68.7 million for the third quarter of 2007, an increase of $30.0 million, or 77.4%, from last year's third quarter.

Asia Pacific Region

In the Asia Pacific region, which includes operations in Asia, Australia and New Zealand, revenue totaled $134.5 million for the third quarter of 2007, a 54.5% increase from $87.0 million for the third quarter of 2006. This revenue increase was driven by improved performance in Australia, China, Japan and Singapore.

Operating income for the Asia Pacific segment increased to $18.3 million for the third quarter of 2007 compared to $5.0 million for the same period last year. EBITDA for the Asia Pacific segment totaled $19.1 million for the third quarter of 2007, an increase of $10.7 million, or 128.6%, from last year's third quarter.

The Asia Pacific segment did not incur any significant one-time costs in the current or prior year quarter.

Global Investment Management Business

In the Global Investment Management segment, which consists of investment management operations in the U.S., Europe and Asia, revenue totaled $99.1 million for the third quarter of 2007, a 139.5% increase from the $41.4 million recorded in the third quarter of 2006. This increase was mainly due to higher incentive fees as well as increased investment management fees, a source of recurring revenue, in the U.S. and the U.K. Higher investment management fees resulted from a continued steady increase in assets under management. Total assets under management have grown 24.5% from year-end 2006 to $35.6 billion at the end of the third quarter.

This segment reported operating income of $20.8 million for the third quarter of 2007, compared with $10.9 million for the same period last year. EBITDA for this segment totaled $23.2 million for the third quarter of 2007, an increase of $8.1 million, or 53.1%, from last year's third quarter. The improved performance was mainly attributable to the aforementioned increase in incentive and asset management fees, partially offset by carried interest activity. As compared with the prior year third quarter, revenue recognized from funds liquidating (carried interest revenue) decreased by $3.0 million while incentive compensation expense recognized for dedicated executives and team leaders associated with this segment's carried interest programs was $11.0 million higher.

For the third quarter of 2007, the Company recorded a total of $17.6 million of incentive compensation expense related to carried interest revenue, only $0.1 million of which pertained to revenue recognized during the third quarter of 2007 with the remainder relating to future periods' revenue. Revenues associated with these expenses cannot be recognized until certain contractual hurdles are met. The Company expects that it will recognize income from funds liquidating in future quarters that will more than offset the additional $17.5 million of incentive compensation expense recognized.

The Global Investment Management segment did not incur any one-time costs in the current or prior year quarter.

Development Services

The Development Services segment consists of real estate development and investment activities primarily in the U.S. acquired with the Trammell Crow Company in December 2006. Revenue for this segment totaled $24.3 million for the third quarter of 2007.

This segment reported operating income of $7.8 million for the third quarter of 2007. Excluding the impact of one-time items, operating income would have been $8.4 million. EBITDA for this segment totaled $2.7 million for the third quarter of 2007. The difference primarily reflects the impact of minority interest expense, which is included in the calculation of EBITDA, but not in the calculation of operating income. Excluding the impact of purchase accounting, the Company's earnings would have increased by approximately $8.4 million from net gains on real estate sold during the third quarter of 2007.

Development projects in process as of September 30, 2007 totaled $6.7 billion, a 24% increase from year-end 2006. The inventory of pipeline deals as of September 30, 2007 stood at $2.9 billion. The combined total of $9.6 billion of in-process and pipeline activity matches the level achieved at mid-year 2007.

Guidance

The Company is maintaining its guidance of full-year diluted earnings per share growth of approximately 50% for 2007 as compared to 2006, excluding one-time items.