Weekly Real Estate News
CBRE has agreed to pay £460 million, about $610 million, for London-based data-center infrastructure contractor Onnec Group. The company could pay another £300 million ($400 million) if Onnec meets growth targets over several years. The acquisition announced October 20 would extend the commercial property adviser’s business into the technology installed inside data centers.
CBRE’s definitive agreement is subject to regulatory approvals, with completion expected around year-end. The potential $1 billion price includes the contingent payment. It would be inaccurate to describe the entire sum as cash already spent or the transaction as closed.
Onnec installs and maintains network cabling, fiber connections and other technical infrastructure for large data-center customers. Founded in 1986, it employs approximately 800 people in Britain, continental Europe and the Asia-Pacific region. CBRE intends to place the company within its Critical Infrastructure Services business.
CBRE has been building technical-service operations alongside its traditional property management, brokerage and development businesses. Its 2024 acquisition of Direct Line expanded data-center services in the United States. Onnec would add a comparable footprint in Europe and Asia, where operators often commission similar facilities in multiple countries.
Price and earnings forecasts
CBRE estimates Onnec will produce approximately £370 million ($498 million) in 2027 revenue and more than £50 million ($67 million) in core EBITDA. Both figures are projections. Core EBITDA is a company-defined non-GAAP measure, not net profit. CBRE also expects the acquisition to contribute positively to core earnings per share after closing, but has not disclosed detailed integration costs.
With Onnec included, CBRE expects nearly $4.5 billion in 2027 revenue from Critical Infrastructure Services. Other service businesses, including project management and advisory work, are forecast to generate almost $2.5 billion of infrastructure-related revenue. The resulting $7 billion estimate spans several divisions and excludes occasional data-center land sales by its development operation.
For commercial property owners and lenders, the move reflects a growing distinction between delivering a data-center building and making it operational. Internal network installation, power connections and equipment commissioning can determine when a tenant starts using a facility and paying rent. The services Onnec provides sit in that critical period between construction completion and operation.
The opportunity also carries risk. Spending on artificial intelligence and cloud computing has increased demand for capacity, but electricity availability, construction costs and customers’ capital budgets can slow projects. CBRE’s earnout arrangement leaves a portion of the price dependent on performance rather than fixing the entire consideration at signing.
CBRE named J.P. Morgan Securities and Simpson Thacher & Bartlett as its financial and legal advisers. Onnec is advised by Goldman Sachs International and Freshfields. The company has not disclosed the earnout thresholds. CBRE is due to release third-quarter earnings October 22.
Illustrative data-center photograph: Taylor Vick / Unsplash. The image does not depict an Onnec facility.
