CBRE CEO Shrugs off AI Scare Trade as Stock Whipsaws

Wall Street may be spooked by artificial intelligence. CBRE’s chief isn’t.

Shares of CBRE plunged nearly 9 percent Thursday to close at $136, capping a two-day, 20 percent slide — the company’s steepest drop since 2020 — as investors fretted that rapid advances in AI could erode demand for office space and disrupt brokerage models. The stock slid again early Friday before rebounding more than 5 percent by midday, Bloomberg reported. Its shares closed on Friday at $142, up 4.4 percent from Thursday’s close.

The selloff rippled across the sector. JLL fell 7.6 percent and Newmark dropped more than 4 percent on Thursday, as what analysts dubbed the latest “AI scare trade” spread from brokerages to real estate investment trusts.

On an earnings call on Thursday, CBRE CEO Bob Sulentic struck a markedly different tone. The Dallas-based firm’s work, he argued, is too complex to be automated away, the Dallas Business Journal reported.

“We don’t get our brokerage leads online somewhere,” Sulentic said, pointing to the “deep knowledge” brokers cultivate with occupiers and investors. Strategic advice on major transactions and oversight of global development projects, he suggested, are not easily replicated by code.

If anything, AI is proving additive. Sulentic said CBRE rolled out internal AI tools to arm brokers with data more efficiently and at lower cost. And the technology is fueling one of the firm’s fastest-growing businesses: data centers.

CBRE reported record 2025 revenue of $40.6 billion, up 13 percent, year-over-year, with fourth-quarter revenue rising 12 percent to $11.6 billion. Net income for the year climbed nearly 20 percent to about $1.2 billion. Core earnings per share of $2.73 beat Wall Street estimates.

Data center and digital infrastructure work accounted for roughly 14 percent of CBRE’s pre-tax earnings in 2025, Sulentic said. The firm expects revenue from its data center business to hit $2 billion in 2026, growing at a 20 percent annual clip.

CBRE has been bulking up accordingly. In 2024, it bought technical services firm Direct Line Global, and in November closed a $1.2 billion acquisition of Pearce Services from New Mountain Capital, expanding its reach into cooling systems and electrical infrastructure critical to server farms.

Sulentic acknowledged the possibility of an AI-fueled bubble, but added it should be taken into context that five years ago the current amount of data center business was considered unimaginable, and five years from now it is impossible for him to say whether it will grow larger or fizzle.

“What’s happening is that talent is being used to support the growth of AI,” Sulentic said. “So we think there’s going to be enduring growth there.”

— Eric Weilbacher