new position added

I have purchase CB Richard Ellis (CBG) two days ago at $13.50 per share. I will post a complete write up on this opportunity, but highlight for my purchase:

1. Premier real estate service company in the world.
2. Commercial real estate fundamentals are deteriorating but will crash as many expect and therefore many real estate operation prices are selling at steep discount to net asset value.
3. the outsourcing segment, which have recurring revenue and is not affected by occupancy as maintenance has to performed on a building if it is empty or not, valuation alone equals to market cap of CBG and you get other segments for free.
4. The company has an international network of services in growing markets.
5. Top skilled management that can navigate difficult market conditions.
6. Commercial real estate prices do not affect their results as much as lack of transactions. Transactions over the last 6 months have been almost non existent but that is a temporary event that can reverse quickly.

The valuation of CBG has gotten really attractive after their earnings release, which has declined by some 80%. The company represent good value at these levels for the long term holding.