Inside CBRE’s Continued Push Into EV Charging Infrastructure • Propmodo

Oct 18, 2024

If policymakers’ ambitious goals come to fruition, we could soon see millions of EV charging stations in homes, parking garages, commercial properties, and highway exits nationwide. Progress towards these goals has already been made. The U.S. Department of Energy says over 60,000 public EV charging locations are available nationwide, and the number is growing daily. The Biden administration has invested $7.5 billion through the Bipartisan Infrastructure Law to build a robust national EV charging network.

Electric vehicle sales have grown annually, with more automakers entering the market and consumers showing interest. While EV sales have experienced fluctuations, with growth slowing this year compared to 2023, data from Argonne National Laboratory shows continued growth overall.

This shift represents a unique investment opportunity for the real estate industry. It is a much-repeated claim that embracing EV charging enhances property values and positions them for the surge of new electric vehicles that many expect will be on the roads. While the trend is not new, property owners and real estate firms are getting more aggressive in EV charging investments.

Of all the commercial real estate firms investing in EV charging, CBRE may have the most aggressive strategy. Earlier this year, CBRE formed a preferred partner agreement with EV+ to deploy charging systems across 10,000 U.S. commercial properties over the next five years.

The partnership focuses on building infrastructure where drivers most need charging stations, such as hotels, healthcare-related facilities, and multifamily complexes. EV+ said in a news release that all these properties have been “critically underserved to date.” Each property will host roughly ten charging stations, and the rollout will include offices.

CBRE said its partnership with EV+ will offer reliable charging stations to property owners with zero upfront capital expenditures. CBRE and EV+ will handle the charging stations’ design, infrastructure, installation, customer service, and maintenance. Landlords can make drivers pay for the electricity they need to charge their vehicles or offer the services as a free amenity to tenants. Property owners would pay a monthly subscription fee of about $150 to $300 for the infrastructure and services from CBRE and EV+.

For some property owners, the charging stations could provide a potential revenue stream like a vending machine. CBRE and EV+ will manage the upkeep and functioning of ‘military-grade’ redundancy systems to keep the chargers connected to electric power. CBRE will also provide site acquisition services and attain potential grants and tax incentives.

The recent partnership adds to CBRE’s growing list of EV infrastructure partners as it works to meet the substantial demand expected in the years ahead. A report from CBRE and ChargePoint says workplace EV charging sessions are growing twice as fast as station installations. EV registrations will increase at an annual average rate of 40 percent over the next five years.

CBRE also recently announced an agreement with Invisible Urban Charging, a charging-as-a-service solution company, to support the nationwide rollout of one million EV charging stations over the next five years. “It’s a great opportunity to have EV+ and Invisible Urban Charging as clients of ours, and they complement each other well because we have such a large demand for charging infrastructure required to deploy across the U.S.,” said Jim Hurless, global head of real estate for CBRE EV Solutions. “So we need multiple providers. We need to have many, many other providers, in fact, to meet the demand.”

CBRE is not new to EV charging investments. In 2019, CRE and SemaConnect, a leader in Class A commercial EV charging solutions, completed the installation of 1,100 stations in 15 major U.S. metros, including 68 stations in Chicago.

As the demand for electric vehicles has increased, CBRE has leaned harder into EV charging investments like many commercial real estate firms. As the world’s largest commercial real estate brokerage by revenue, it has the capital to establish these partnerships at a scale that few firms can.

Last year, CBRE also announced plans to add a new global electric vehicle services line to its offerings to help guide landlords on EV infrastructure. According to their website, CBRE now offers end-to-end EV charging services, including planning, site selection, financing, installation, and ongoing management of EV charging infrastructure.

Other major real estate services firms are pouncing on the expected transition from gasoline-powered vehicles to electric ones. The state of Georgia hired JLL and other consultants last year to help it apply for federal funds to enhance its electric vehicle infrastructure.

JLL, accounting and consulting firm Ernst & Young, and architecture and engineering firm HNTB agreed to work with the Georgia Department of Transportation to develop an EV charging plan and the state’s request for federal funds. At the time of the agreement, states were rushing to meet a deadline for applications to receive funds from a $5 billion federal grant program.

The federal grant program is part of a broader $7.5 billion federal investment plan to improve electric power equipment and make EV chargers more readily available in rural and underserved areas. The Biden administration has set the goal to install 500,000 charging stations nationwide.

Like CBRE, JLL is making strides in electric vehicle charging through strategic partnerships. Late last year, JLL teamed up with Qmerit Solutions to streamline EV charging installations across its U.S. properties.

The partnership unlocks access to Qmerit’s commercial assessment platform and its network of certified EV charging electricians. By leveraging Qmerit’s on-site assessments and technician network, JLL is enhancing its EV infrastructure services, offering consulting and installation solutions to its clients.

Cushman & Wakefield have made similar investments. In 2022, the real estate services firm announced a preferred supplier agreement with Blink Charging Co. to market and deploy Blink charging stations and related services to Cushman clients throughout the U.S. At the time, Cushman said it would engage its extensive network of property managers to introduce Blink EV charging equipment and services as a potential amenity at its commercial properties.

The strong demand for EV charging infrastructure supports CBRE, JLL, and Cushman & Wakefield’s investments. According to estimates from the Edison Electric Institute, nearly 12.9 million charging ports will need to be installed to support 26.4 million electric vehicles forecasted to be on U.S. roads by 2030.

The U.S. National Renewable Energy Laboratory predicts the need for charging ports will be even greater. In a 2023 report, the federally funded lab estimated that 26.8 million Level 1 and Level 2 EV charging ports will be required in workplaces, multifamily properties, and single-family homes by 2030.

Some surveys show consumer excitement around EVs has slowed. AAA’s most recent annual consumer survey on electric vehicles indicated a decline in consumer interest in purchasing EVs, with only 18 percent of American adults saying they were “very likely” or “likely” to buy a new or used EV this year.

Other research reveals the high cost of electric vehicles is slowing their adoption among U.S. consumers. Bank of America analysts say EV demand slowed sharply this year. Only three percent of U.S. EVs are priced at less than $37,000, compared with more than half of gas-powered or hybrid vehicles. The report continues that automakers are unlikely to bring EV costs down to a more competitive level until 2028.

Electric vehicles may not be mainstream yet, but progress toward more mass adoption is still being made. Earlier this year, Bank of America research forecasted an approximately 10 percent EV market penetration for 2024, 18 percent in 2027, and about 33 percent by 2030. The research said the trajectory of EV adoption has been pushed back by a year or more.

Government policy support for EVs has looked less certain than a year ago, partially due to the upcoming election and politicization of the transition to electric vehicles. However, the Biden administration is still setting ambitious goals for EV adoption, aiming for 50 percent of all new vehicle sales in the U.S. to be electric by 2030.

Earlier this year, the Biden administration announced a rule designed to ensure that by 2032, the majority of new passenger cars and light trucks sold in the U.S. will be all-electric or hybrids. The EPA’s tailpipe pollution limits would be a significant new requirement for the American automobile market.

The considerable tailwinds pushing electric vehicle adoption further ahead create attractive investment opportunities for commercial real estate services firms like CBRE, JLL, and Cushman & Wakefield. While the trajectory of electric vehicle adoption could always change, it looks highly likely that EV sales will increasingly penetrate the U.S. automobile market in the years to come. CBRE and its rivals are poised to capitalize on this opportunity.

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