CBRE Joins Major Brokerages Pulling Out Of Russia Amid ‘Horrific’ Ukraine Invasion

UPDATE, MARCH 7, 6 P.M. ET: The story has been updated to include a new statement from CBRE regarding its future plans in Russia.

It took only a handful of years after the Soviet Union collapsed for commercial real estate services giants like JLL and Cushman & Wakefield to establish offices in Moscow. Three decades later, as Russia is increasingly isolated from the global economy after its invasion of Ukraine, these titans of U.S. and UK real estate collectively employ hundreds of professionals in the country.

Now, a little over a week after Russia’s invasion of Ukraine kicked off Europe’s largest ground war since World War II, those firms are re-evaluating their presence in the country, with some quick to cut ties. 

CBRE is the latest brokerage to discontinue most of its Russia operations, joining the likes of Knight Frank and Savills, who told Bisnow last week they planned to close their offices. 

The company said Monday it "has begun the process of exiting its office in Moscow, which provides leasing, investment, property management and valuation services, and terminating two existing affiliate relationships in the country."

It will maintain a small presence "to manage facilities and provide other essential services for existing multi-national clients that are operating in Russia."

Knight Frank and Savills were among the first major Western brokerages to cut ties with Russia. 

“With immediate effect, and with their agreement, we have suspended the commercial arrangements with our independent licensee in Russia,” a spokesperson for Knight Frank said in an email to Bisnow, declining to elaborate further.

London-based Knight Frank has had a presence in Russia for nearly 20 years, employing about 260 people and providing commercial and residential real estate services in that country.

Savills, also based in London, operates in Russia through a franchisee "with which Savills has a very longstanding relationship," a spokesperson for Savills said.

"This agreement has been suspended," the company told Bisnow, adding the firm will not conduct business with sanctioned entities or persons.

Including Knight Frank and Savills, Bisnow reached out to eight top commercial real estate service providers with a presence in Russia regarding their plans. Of the five that responded, all were at least considering plans to close their offices or cut ties with franchisees. 

Colliers told Bisnow it is evaluating its operations in Russia and fully supports all sanctions. The Toronto-based firm first set up shop in the country in 1994 and now has offices in Moscow and St. Petersburg with more than 500 employees.

Avison Young said it is currently evaluating the impact newly imposed sanctions on Russia will have on its operations and clients. Also based in Toronto, Avison Young expanded in Russia in 2021 through an affiliation with GVA Sawyer, whose consulting and brokerage operations in that country were later rebranded as Avison Young.

"We will fully comply with any and all required actions," an Avison Young spokesperson said, adding the company "cares deeply about the humanitarian impact of Russia’s attack on Ukraine."

"Our hearts are with the civilians caught in the middle of this international crisis," the spokesperson said.

JLL also told Bisnow it was monitoring the situation, which remains highly volatile and dynamic, a spokesperson said.

"It is too early to predict any potential market or business changes," the JLL spokesperson said. "Our priority remains the safety of our people and clients. We are investing significant resources to protect them, support the relief efforts, as well as to help those in Russia (people and clients) adjust to the rapidly changing situation."

Knight Frank and Savills are the latest major U.S. companies to cut ties with Russia in the past week.

Major oil companies such as BP, Shell and Exxon Mobile have all announced they are winding down their operations in oil-rich Russia. Automakers Volvo Cars and General Motors have stopped exports to Russia, as has motorcycle giant Harley-Davidson.

Tech firms such as Apple and Dell have suspended sales in Russia, and logistics and shipping companies, including UPS, FedEx and Maersk, are pulling out of the country.

Among retailers, Swedish company Ikea said Thursday it would pause its operations in Russia, while TJX, the parent company of T.J. Maxx and Marshalls, is divesting its stake in Familia, a retailer with 400 locations in Russia.

“You just do not want your brand associated with this image in any way," Adam Tooze, director of the European Institute at Columbia University, told Forbes. “You want the hell out of Dodge.”

In the real estate industry, a number of companies that haven't cut ties with Russia say they are considering that step.

Bisnow first reported that global real estate investment giant Hines is considering exiting its Russian real estate assets. About 2% of Hines’ $84B in assets under management are in Russia, or about $1.5B.

“We are in discussions with our partners to re-evaluate a large percentage of our assets in Russia and our presence in the country," a Hines spokesperson previously told Bisnow. 

While Colliers did not specify plans in Russia, U.S. President and CEO Gil Borok told Bisnow via email it would close its affiliate office in Kyiv due to safety concerns. 

"We are horrified by the events unfolding in the Ukraine, the escalation of the attacks by the Russian forces, the civilian casualty toll, and the very personal stories we are hearing from our people," Borok said. 

Colliers, as well as members of senior leadership, have made significant donations to the Ukraine Crisis Appeal via the International Committee of the Red Cross and other humanitarian charities, he added.

"We are focused on supporting our Ukrainian colleagues who remain in the country, those who are seeking refuge along with their families, and the humanitarian relief effort," Borok said.

Chicago-based Cushman & Wakefield and Paris-based BNP Paribas Real Estate did not respond to Bisnow's queries.

Real estate services giant CBRE, based in Dallas, also declined to comment for this article before providing a statement of its own on Monday. In its announcement, CBRE said it will lay off many of its Russia employees, expect for those honoring existing management and services contracts

"CBRE is working diligently to support its loyal and hardworking colleagues in Russia who will transition from the company," the company said in a statement Monday. "CBRE regrets the impact that this transition will have on those employees, who are leaving the company through no fault of their own."

It added that the company's operations there represented less than 1% of the firm's global revenue in 2021. 

“Everybody is concerned about what the impact might be on the global economy," CEO Bob Sulentic mentioned during an earnings call the day Russia invaded Ukraine. said. "And when I say everybody, everybody in our sector, but everybody pretty much in every sector.”