How are we doing? Thumbs up. How are we like this? Just before I do start, a bit of housekeeping. Health and safety. We're not planning any fire alarm tests, so if a fire alarm does go off, don't panic. It may go off because you're bored of my presentation. I'm going on too long, so it could be deliberate. Obviously, exit the way you came in, upstairs through into the reception onto Margaret Street. The revolving doors, don't place sardines, and then the side doors will open, and you can get out onto Margaret Street safely. Great to have you here in person. Are we ready to roll? Good. Thank you. Thank you very much personally for coming in, and those also for joining us online. It gives me a great deal of pleasure to start by giving you the highlights.
Good morning to all of you. Here is a presentation of our preliminary results for the year ending 31 December 2024. As you all know here, today's presentation is hybrid. Welcome to those attending in person, as I said, and please enjoy your coffee. It is also great to have you back in Margaret Street, which is our global headquarters. Thank you also to those attending on webinar, assuming the technology continues to work. In line with previous years, I will present the highlights, which you will see on this slide, as well as an overview of the market on sentiment and activity. Before handing over to Simon, we will take you through a detailed review of the main financial performance of our segments and the business.
I will then conclude with a brief update on the strategy for growth and the business development that we've undertaken during the year before finishing with our summary and outlook for the current year. We will then, of course, invite you all, any questions you have, whether in person here or online. As a recap, when I look back at the half-year results last year, I highlighted that we were sensing the beginnings of a stabilization, a probably difficult word these days, following a rapid market recalibration with the beginnings of a recovery in confidence. Whilst this did carry into the second half of last year, the market does continue to be overshadowed, as we all know, by major geopolitical and economic uncertainty. Rules are being rewritten around global security, trade tariffs, and the likely effects on economic outlook.
I'm sure all of you in this room here today will agree that these are elevated risks. We can only therefore control the controllables by focusing on our core strategy for growth, maintaining our secure financial footing, and looking for the themes of recovery in anticipation of a return to more normal and stable conditions. As ever, our focus within Savills is to continue to provide the best possible advice we can to all our clients worldwide, look after our global workforce, and continue to maintain our strict discipline for cost control. Let's move on to the highlights on this slide in front of you. I'm pleased to announce that the group concluded 2024 with a significantly improved performance, taking into account the uncertain macro conditions I've highlighted earlier.
The balance and diversity of our business allowed us to increase group revenue by 7.4%, 10% in constant currency, to report annual revenues of GBP 2.404 billion. The benefits of this improved revenue also drove underlying profit to GBP 130.4 million, a 37.6% increase, and a 40% increase in constant currency. The key drivers, as you'll see on the slide of this improved performance, include a recovery in our global transaction revenues of 13%, reflecting the gradual recovery of transactional volumes across both the commercial and residential sectors in our key markets. We also benefited from robust growth from our less transactional businesses, totaling an aggregate of 64% of our total revenue, with annualized growth overall of 5%. Our net cash position at the year-end has increased to GBP 176.3 million.
In light of this improved performance across the platform, we are proposing an aggregate dividend distribution of GBP 0.32 per share, an increase of 32% on 2023. This reflects our continued confidence in our resilient business model. Turning to that resilience, putting this in context and looking at the 10-year revenue growth we have experienced, I want to just highlight a couple of key observations. Firstly, we have obviously maintained over the entire period an annualized growth rate of 8%. The vast majority of that growth is actually organic as opposed to M&A activity. In addition, the chart clearly highlights the faster growth of our less transactional revenue, which now totals over GBP 1.5 billion per annum, equaling the size of our total group revenue in 2016. This, as many of you know, has been a deliberate core strategy, reflecting the improved quality of our earnings.
Finally, the chart clearly highlights the turbulence in the markets that we've all had to live through really since 2019, the Brexit year. It's also neatly coincided with my appointment as Group Chief Executive. Timing is everything. Moving on to themes for recovery, rather than look back as a rearview mirror on what we saw last year, with market sentiment now almost changing daily, I thought it would be useful to look through to the main themes of a recovery as a backdrop to the core elements of our future growth strategy. The continued turbulence has made equity raising for direct real estate funds pretty challenging, particularly for core and core plus products, with more focus on value-add returns as well as debt and infrastructure. Against this uncertain backdrop, sectors like the residential and living sectors continue to perform well.
Investors, in many cases, remain underweight to this sector, and this should give more opportunities going forward. Occupational markets are also starting to recover but are sensitive to costs, whether localized labor costs or direct real estate costs, and there will be a continued drive towards greater efficiency. Indeed, occupier activity is gathering greater momentum, catalyzed by the stalling, actually, please come in, of development activity, meaning options on the medium term are actually reduced, and people are seeing localized shortages, particularly affecting prime offices and prime industrial and logistics. Whilst this is leading to some green shoots of rental growth, we still have a backdrop of high bill costs and increasing obsolescence, with continued hesitancy around decision-making. Turning to investment market activity, looking back to last year, whilst global annual investment volumes did increase by 10%, they are still 25% behind the five-year pre-COVID average.
The total for the year was somewhat rescued by a strong Q4. Before that, it was slightly subdued. The shape of the recovery has varied across various regions and is market-specific, with a sectoral focus, as I mentioned, on beds and sheds or living and logistics, as well as hotels, a very strong year for them. Confidence also improved in the previously unloved office sector, particularly during Q4 in major markets. It is good to highlight that London regained its crown as the top cross-border destination for international capital. In fact, this is already driving yield compression across some of the prime sectors. With cautious but progressive improvement in risk sentiment, we are seeing more activity from opportunistic investors seeking deeper discounts on mispriced assets. This is driving greater portfolio and M&A activity, something we'd like to see more of during the course of this year.
Okay, on to occupational markets. Obviously, leasing volumes continue to improve on the year, up 8% in Europe, 14% in North America, with the APAC region experiencing significant regional variations, but all regions still significantly below pre-COVID levels of take-up. That said, office vacancy rates have now generally stabilized across a number of markets, except perhaps secondary office supply, where there's still elevated levels of availability. Polarization to prime offices continue. Many of you will be relieved to hear I'll hardly reference work from home as a major influence in the markets, even in North America. This is clearly evidenced by the strong rental growth we're seeing in cities like London, New York, and Dubai. The elevated level of take-up in industrial logistics experienced really immediately post-COVID has moderated, which we expected.
It is picking up again in the main markets across Europe, more of a demand normalization, as I said, whilst prime retail demand in key world cities is also improving as the cities return to life. Retail demand also remains focused on a number of emerging markets as retailers look for first-mover advantage in these developing economies. Onto residential. Whilst I mentioned earlier the resilience of the sector, many market segments still remain adversely affected by the much higher cost of debt, its effect on affordability, as well as some of the markets experiencing now a shortage of supply. In the U.K. mainstream market, national transaction volumes rose 8% year-on-year, but still are 8% below pre-COVID average. Prime sales above GBP 1 million were also up 8%, with prices rising by 0.6% in London, with a marginal fall in prime country prices.
Across the international markets, it was a mixed picture and challenging in some markets like mainland China, down 10%, whilst in Hong Kong, there was a bounce back with sales volumes up actually 17% year-on-year as that market started to recover. Looking at the APAC region as a whole, market recovery was strongest in Sydney and Tokyo, stabilizing in Singapore. Closest to home, we're also seeing price increases in markets including Madrid, Barcelona, and Amsterdam. I will now hand over to Simon to take you through the financials. Thanks, Simon.
Thank you very much, Mark. Good morning, everybody. Fantastic to be standing in front of real people again rather than a blank screen, which is a huge relief.
I think the summary of what you've heard on the overall results for the year is that in markets that were a long, long way from fully recovered, what you begin to see is the real operational leverage in this business. The fact that we've significantly increased margin and profits on our 7% revenue growth, 10% constant currency. Currency did cost us GBP 2.5 million. There's a currency schedule in the appendix to this pack if you're interested. Underlying EPS growth just over 20% as we had a higher tax charge in this year, and it is a one-off, primarily associated with some prior year deferred tax adjustments that went through in this period. What you should expect to see is a tax rate that hovers somewhere between 30% and 32% or so as we look forward.
You'll have also read about the extension of our restructuring program from the previous year. This was during what was an extraordinarily volatile year in respect of expectations around forward interest rates. I can't remember a year in which those expectations moved around so much and in both directions during the period. What we were doing was keeping open our assumptions and refreshing them through the year. We made some additional changes, particularly focused on those markets that were a bit more compromised than the rest of the world, namely particularly Germany and particularly mainland China, for which a provision of GBP 17.2 million was made in 2024. There is another GBP 3.5 million to come through in the first quarter of this year. It's all done, but for accounting reasons, we couldn't reflect it in last year. Just to warn you in advance of that.
This is one of the primary differences between statutory earnings and our preferred and consistently measured underlying measure of earnings per share. This trading performance allowed us to make a significant increase in the dividends, as you've just heard, supported by the strong net cash position at year-end, which we'll talk a bit more about in a moment. Let's turn now to where we actually made our money. This is actually the last time you will see this form of the geographic segmentation of our business. As from this year, we're moving to an EMEA basis, which is in line with some revised board and management structures we put in place last year. The three segments from here on will be Europe, Middle East, and Africa, EMEA, Asia-Pacific, and North America, respectively.
We will, of course, continue to call out any individual country impact on performance in future commentaries. This does, to some extent, also help us with comparison with some of our peers who still report on a geographic basis too. A proper comparative will be provided at the half year and the year-end. In the meantime, you can actually simply add together the two left-hand columns of this chart. It is not overly exciting from an analyst perspective. Anyway, back to trading. After the volatility of the last few years and with very, very variable levels of recovery in our markets, it is really gratifying to see a return to green arrows across the board on this slide, with every top and bottom line improved during the year. Indeed, points to note, our U.K. business broke the GBP 1 billion barrier for the first time in its history.
North America turned back into profit. Continental Europe and the Middle East materially reduced its losses, as anticipated, whilst a number of its major markets were obviously, as you know, still quite challenged. Asia-Pacific returned to growth, even in the context of continued challenging markets in Greater China. We were also this year delighted to take a controlling position in our Indian business, which was consolidated from August 2024. It is relatively small numbers to date, but we got very high hopes for this over the next five to ten years as a growth engine of our Asia-Pac business. How did we make our money? We know where we made it, but how did we make it? I should really entitle this slide "Operational Leverage in Action." You can see the significant growth in profits in the transactional side of the business.
This is despite many of the core markets still remaining very subdued, as I've mentioned already. Our less transactional businesses, consultancy and property management, performed well. You can see that there was indeed some operational leverage in the consultancy business, as we saw all but a couple of our individual service lines come back into a growth phase. Finally, Savills Investment Management had what we would hope and expect to be its nadir year, as less capital was generally allocatable to our core investment style, with markets particularly focused more on the value-add end of the investment spectrum. Let's move straight on to the segments, starting with the commercial transaction business.
On a global basis, a 15% increase in, or in absolute terms, a GBP 86 million increase in revenue gave rise to a near GBP 33 million increase in profits as the incremental revenue flowed through at about 38% margin. That is the operational leverage I was talking about. The explanations for performance of each of our businesses are set out on the slide, but I draw your attention to the impact of trading improvements in continental Europe and the Middle East region, supported by the effect of restructuring in Germany and France, which led to an approximate halving of losses in the region during the year. Likewise, in North America and APAC, we returned to profit in 2024, the latter being driven for the most part by our ex-Greater China elements of the APAC region, where we saw increasing strength through the last quarter of the year.
In a world where markets such as the U.K. were still only marginally above COVID levels of transaction volume and others were still well below, we're pleased with this performance. One point I should make here is that in the early days of developing our international residential network, we have yet to break out the results of that business into the residential segment. This will happen in 2025, but for now, the financial impact of this strategy, which was particularly actually net P&L investment in the Middle East as we grew that business substantially during the year, sits within the CME segment on this page. Let's turn now to our residential segment. Overall, the growth in profits, U.K. profits, was offset by the Asia-Pacific business falling into loss for the year.
This was absolutely down to slow mainland Chinese and Singaporean markets, partially offset by some significant transactions in Hong Kong and improvements in other parts of the APAC region. In the U.K., second-hand sales increased 13% on the back of a more attractive mortgage market, perhaps a bit more stable in the second half of the year. At that point, I should say, greater stability in forward interest rate expectations. On the other hand, development sales of new homes reduced by some 13% on top of the reductions of 2023. This did necessitate a little bit of a further right-sizing of our team in this sector in advance of future growth coming back. We've started the new year well.
However, it is fair to say that both fiscal change this April and broader geopolitical concerns are likely to have an impact on the market in the very near term, but do not change the fundamentals of it as we look through to the medium and beyond. Our operational capital markets business also had a good year. That is mainly, but not exclusively, the bed sector, living, student, etc. It performed well despite several transactions shifting into 2025 from the back end of last year. Let us turn to our less transactional service line, starting with property management. Globally, 5% reported growth, which was 7% in constant currency, and double-digit growth in the profit line. In the U.K., both contract wins in FM and PM were enhanced by greater revenue from energy sourcing and sustainability advisory work on our portfolio.
In addition, both the lettings business and our rural management portfolio performed well during the year. In continental Europe and the Middle East, growth in the markets referenced in this slide was outweighed by the assumption of costs in advance of revenue in respect of a very significant contract win, pan-European win, I should say, in our German business. We will not see revenue really coming from that until probably the second half of this year. Finally, in APAC, there was a combination of really three things that produced 1% revenue growth, but an improved 6% bottom line growth. Those were labor shortages in Hong Kong having an effect on cost at certain times in the year, a reduction in activity in the Macau leisure industry for pure economic reasons, and reductions in revenue in mainland China as we restructured the business there.
That restricted the revenue growth, but improved our profit performance to 6% in constant currency. Just to give you an indication of what we've done in China, over the last 18 months, we've closed five regional tier two and three city offices and reduced the size of a further three. It is not an insubstantial exercise that's been going on there. Overall, a good result despite some difficult markets. Turning to consultancy, you can see 8% nominal revenue growth, 9% in constant currency, which is within our normal expected range of high single to low double digits in any given period from this portfolio. In the U.K., we saw growth in most of our service lines, perhaps with the exception of the leisure industry and the social housing consultancy, the latter being particularly affected by hiatus, as it always is, around the U.K. general election.
Meanwhile, project management grew nicely for us on the back of increases, Mark referenced earlier, green fit assignments associated with the sustainability piece that we've talked about and retrofitting assets on behalf of landlords. In continental Europe and the Middle East, the countries named on this slide, and in particular, a surge in consulting activity in Saudi Arabia contributed to a significant increase in profits from the Middle Eastern consultancy or from the continental European and Middle Eastern consultancy business. I'm looking forward to being able to say EMEA, by the way. In APAC, market-related volume reductions had a negative effect, particularly on the valuation element of our consultancy businesses in Hong Kong and mainland China, which was partially offset by the strengthening of activity in Australia, Japan, and even Taipei during the period, and the initial part of the consolidation of our Indian business.
Finally, North America reduced its losses to near break-even through growth in the project management side of our business, but that was offset by a reduction in activity temporarily in life sciences and technology in that part of the market. The final segment is investment management. As I indicated previously, we were anticipating that this would be the hardest year for Savills Investment Management and through the difficulty of deploying new capital into core-style products, which reduced both transaction fee revenue. At the other end of the spectrum, the difficulty in realizing value in that market reduced performance fee revenue too. The result of this was that the 2024 base management fees, although slightly reduced on valuations in the portfolios, represented 86% of our total revenue in investment management, which is an all-time record. It's never been as high as that before.
It just does show there is a resilience in that business that allows us to make money even in really difficult times for that. We continue to grow the asset management business in Germany and in Italy in particular. We launched two new pooled funds during the year. One, a pan-European whole loan fund, which is expected to reach something around the EUR 300 million-EUR 350 million mark on its second close next quarter. The other, Simply Affordable Homes, is our first foray into the affordable living space. It achieved its first GBP 125 million in commitments, which will be invested, I suspect, by the end of next quarter, at which point we'll be out on the raise again for the second tranche.
During the year, we extended last year's restructuring exercise given the circumstances that Savills Investment Management was facing, with a view to putting the business on a good footing in the current environment, but also positioning us well for recovery as that occurs over the course of the coming periods. Having been through the drivers of our operating performance, let's take a quick look at the dividend distribution and a few words about cash. Starting with the dividend, you can see the progressive increase in the ordinary dividend component, which is supported by our less transactional service line performance. The big difference this year is the significant increase in the supplemental interim dividend, otherwise known as the transaction dividend, which is supported obviously by the increase in profits that I've just been talking about and the operational leverage.
It's very heartening to see the impact of our bifurcated dividend policy come through on the upside now, having had to experience it for all of us the previous year on the downside, with a significantly positive impact on our overall distribution. This was obviously helped too by our cash position, which you can see from this slide reflected in operating cash flow of just shy of GBP 118 million compared with a negative GBP 5.5 million last time out. This is where you really see the beneficial effect on working capital of our incentive structure in a period when profits start to rise. It should also be noted that we spent less on acquisitions during the year, primarily down to the timing on some exciting things in the hopper at the moment.
What that acquisitions number does hide, it masks the fact that we did have the deferred consideration payment on DRC Capital, our debt investment manager, of GBP 34 million in September, but that was in working capital as that had been provided for through the life of that business in the six years or so since we bought it, five years. Without that, the working capital position would have actually been positive to the tune of about GBP 25 million. Very clearly showing the impact of our working capital in a rising market. We spent a bit more on CapEx in 2024 as we upgraded and executed a major ERP program in North America and also upgraded, and particularly with a view to sustainability, a number of the offices in our network around the world.
Basically, every other item on this cash flow bridge was consistent with underlying performance. I've already been through the shareholder distribution element of our cash allocation policy. The remainder is directed towards value-enhancing business development, as you would expect. We've got an exciting pipeline of potential transactions in the offing across the field, really, from occupier services, consultancy, international residential agency, and indeed asset management. We expect at least some of those to come to fruition during 2025, which, with the recent renewal of our up to GBP 450 million revolving credit facility, which is totally unutilized at the balance sheet date, we comfortably have the financing in place to deliver on those. With that, I'll hand you back to Mark to talk further about business development.
That's great. Lovely, thank you.
Just before I look forward, what I think it is worth doing is just reminding ourselves of where we are, snapshot of today. It's important to see also not just the split between our less transactional and transactional businesses, but I think it's to highlight really the geographic mix in more detail on the right-hand side of this slide. Also, markets where we're seeing the fastest growth geographically, these future growth markets, which I've highlighted here, which we deem as critical when providing clients with coverage in these markets. Simon's referenced it. Perhaps unsurprisingly, India actually is the fastest growing market you'll see, where we started almost scratch six years ago and now have a full service office operating out of 10 offices with over 800 staff. The next, again referenced, is the Middle East region.
Very strong momentum across the whole of the Middle East, particularly in residential, while Singapore has very much now established itself as our principal hub in Southeast Asia. Vietnam has grown into a market-leading business in all segments, now employs over 2,700 people, and 78% of its revenue is generated out of property and facilities management, a very good keel on the ship. Perhaps quite a surprise to some of you, Simon's referenced, the U.K. has now achieved over GBP 1 billion of revenue, and it is our largest geographic business, but it is still experiencing one of the strongest growth rates of all our businesses, certainly not reaching maturity. There are plenty of opportunities to develop this business and new service lines indeed.
Finally, future growth markets, certainly North America, where we still remain relatively small to our competitors, but also markets like the Philippines, where last year we set up an organic start in Manila. I am pleased to announce we have just completed the acquisition of KMC, a market-leading real estate advisory business based in Manila with 200 staff. Moving on to our global strategy. Whilst, again, the core components of this you will have seen at the half year and prior year, the core components obviously will stay similar, but we have to continue to refine and develop this to reflect the market challenges we are now seeing and look for the opportunities as well as our clients' needs.
Within investor services, our primary focus here remains on developing our market-leading property and facilities management businesses, mainly across EMEA and APAC, building on our reputation as the premier supplier of services in this key area. With that recovery underway in capital and transaction markets, we've also maintained and grown our platform and continued to expand in many key markets with comprehensive services, both around equity and debt. Within investment management, as I highlighted earlier in the themes of recovery, the focus has turned now towards more value-add and infrastructure funds, where we're developing our platform further. Across project management and consultancy services, there's an enormous amount of opportunity to reposition and refurbish obsolete assets for investors and occupiers.
In fact, our worldwide green fit project management teams last year were instructed on over 26 million sq ft of new refurbishment projects, which is an indication of that demand. Moving on to occupier and leasing services, our key focus here is on the growth of our mandated accounts from major corporate occupiers. Globally, this part of the business has tripled over the last three years, thanks to new account wins. In line with this, we've also extended the coverage of our consultancy services to provide occupiers with turnkey solutions. With a recovery of the industrial logistics markets now underway, we continue to organically grow, linked primarily to supply chain and consultancy to support manufacturers' need for flexibility in a world now of tariffs.
Thanks to our very strong reputation in the residential sector, we're growing our wholly owned residential network in the world's prime markets, particularly focused upon across EMEA and the APAC region. This is also closely linked to our investor services across multifamily and the living sector. Finally, we continue to explore, evolve, and adapt new technology across data analytics and including the use of AI across the entire platform. Now moving on geographically to the U.K., our overall revenue increase of 7%, as we've referenced earlier, was driven by growth in both property management as well as that recovery in transactional markets, primarily thanks to market share gains. Within investor services, our capital markets teams were ranked number one nationally across all property types last year, as well as particularly within the office and retail sectors.
As a result of this, we acted on some of the largest transactions during the year, including the sale of M7's retail warehouse portfolio for over GBP 500 million. We also expanded across the Oxford-Cambridge Arc, which is obviously a key focus, and that's obviously relating to life sciences. We also grew our teams in natural capital and renewable sectors and developed our portfolio evaluation business with new mandates from Elgin, Federated Hermes, and Get Living. In the occupier and leasing services, our industrial logistics team expanded with new teams across the Midlands and Northwest, and our global occupier services platform secured a new number of very key mandates from Capgemini, Ministry of Defence, Coca-Cola, etc. Lots to go at.
Within residential services, we grew our global cross-border teams, consolidated our market leading position with a 21% market share over GBP 3 million transactions in London and 27% in the country, whilst our multifamily and OCM teams, as we call them, transacted over GBP 4 billion worth of capital transactions during the year, also ranking them as clear number one. A good litmus test for showing the continued health of the U.K. residential markets was the last week of last year, in fact, where our prime residential teams in London completed the sale of three houses in London SW1, each for over GBP 30 million during the last week, as I said. Simon and I were very relieved to see that. Okay, moving on to continental Europe and the Middle East.
Overall revenue growth of 10% was primarily driven by recovery in transactional revenue, but more weighted to southern Europe and the Middle East. During the year, we formed a new EMEA board, which Simon referenced. The main purpose of this is to ensure that we do have a synergistic approach and a coordinated approach to the development of the entire platform. In conjunction with this, we appointed new heads of Northern Europe, Southern Europe, and the CEE regions. Growth within investor services was primarily focused on European property management, particularly in Germany and Spain, as well as the growth of our industrial and logistics capability. During the year, we acquired a specialist residential property management platform in Spain to support our growing multifamily business.
Within Europe, we advised on some of the largest transactions during the year, including the disposal of Quintane Development in Ireland, a key multifamily deal. Within occupier and leasing services, we established across Italy and UAE new commercial leasing teams. In Italy, we continue to focus also on our global occupier services business, winning new mandates from occupiers including Epson, Total Energies, and Renault. Finally, within residential services, we saw an enormous expansion across the UAE, hiring over 100 new brokers during the year and winning some of the most prestigious residential agency instructions within this growth region. We also acquired a prime residential lettings business in Verbier and established new residential sales teams in both Barcelona and Milan. Onto the APAC region.
Okay, as you'll see from the slide, we saw positive revenue growth driven by that transactional revenue pickup with a 23% uplift, but also strong growth across the consultancy services in that region. During the year, we appointed a new CEO for the APAC region, ex-Greater China, and consolidated the ownership of Simon's reference in India. Transactional recovery was more pronounced in capital markets here, allowing us to grow our market share in key markets, particularly Hong Kong, Japan, South Korea, and Singapore. Because of this, the capital markets teams undertook some of the largest deals of the year, including the sale of Goodman's industrial portfolio for over AUD 800 million. Across our property and facilities management platform, which represents actually 80% of our revenue in this region, we experienced strong growth in Singapore, where what we call our IFM business grew by 20% thanks to contract wins.
We also expanded our project management capability across India and acted for a number of major international corporates, including SAP, Boeing, and AstraZeneca on new facilities in India. Occupier and leasing services allowed us to develop also LCA, which is a leading supply chain consultancy in the region based in Malaysia. We also strengthened our office leasing capability in both China and India, as I've already mentioned. Beyond that, we also acquired KMC in the Philippines. Across residential services in the region, we continued to grow our prime business across the Eastern Seaboard in Australia, a hot market, with a particular focus on Melbourne and Sydney, as well as Hong Kong and Vietnam. Our North American business is heavily weighted, as I think many of you know, to the office sector.
Here we saw a good level of recovery in a number of key markets, including New York, Chicago, and Houston, allowing overall revenue to increase by some 7%. We experienced faster growth in global occupier services as a result of new mandates, with revenue here up 27%. Our project management consultancy grew its revenues by around 11%. During the year, we appointed a new global head of global occupier services and enterprise solutions and continued to grow the platform thanks to large account wins, including Cortica, HubSpot, Sumitomo Corporate, amongst many others. As part of this growth, we also onboarded a further 20 specialist brokers in Minneapolis, expanded our office tenant rep teams nationally, and again, particular focus on New York, Miami, and Atlanta.
Business wins during the year, including advising Louis Vuitton on its new headquarters in Madison Avenue, acting for the Los Angeles County on its 1.4 million sq ft acquisition of the Gas Company Tower, as well as JP Morgan Chase on the acquisition of 250 Park Avenue in Manhattan. Our project management teams also successfully advised major clients, including Greenberg Traurig, Baxter, and Convene on multiple projects. We also completed the new headquarters for Walt Disney Company in New York, totaling some 1.2 million sq ft. Across Canada, growth also continued, and we appointed new teams in both Toronto and Montreal, focused primarily on industrial and logistics.
Okay, finally, in investment management, Simon has already highlighted the anticipated revenue decline here in line with the overall industry, driven by a reduction in the performance fees, as well as our conscious decision to safeguard the deployment of capital until such times as markets have recalibrated. Whilst capital raising in the sector remained difficult, we made good progress last year, raising over EUR 2 billion of new equity for a range of products broadly in line with the previous year. Of paramount importance, bearing in mind current turbulence, was the maintenance of our strong performance across all discretionary products, with 68% of our assets under management outperforming their five-year target.
Moving on to business development, we successfully raised new capital across all our main fund products in logistics, living, debt, and also natural capital, and won significant new equity mandates across a number of sectors, including prime offices, built-to-rent, forestry, and logistics. Our strategic alliance with Samsung Life also continues to progress well, with anchor capital provided now being deployed this year. In line with the strategy to enhance our bench strength, we recently appointed a new global Chief Investment Officer. Moving on to summary and outlook, always a challenge in this sort of market. I'm pleased with our improved performance during 2024, due in a significant part to the increased transactional revenues. However, headwinds continue, and whilst most markets were in recovery as we entered 2025, ongoing geopolitical uncertainty and economic weakness continues to affect sentiment.
Most transactional markets continue to recalibrate, and this is leading to greater liquidity and investor appetite. The recovery of our transactional revenues has been very much leveraged by our deliberate strategy to maintain our transactional bench strength through difficult times to accelerate growth and take market share, as you've heard, in most of the active markets. In addition, the strong balance of our business towards the less transactional or more recurring income continues to underpin our performance with continued growth here. Thanks to that diversity and our strong balance sheet, we are able to continue to advance our growth strategy, which I've highlighted in the areas and sectors that we're focused on. Indeed, we're already seeing positive returns come through from previous investment in the platform, including the new markets we've referenced, India, Middle East, and these will have a greater role to play going forward.
Clearly, the events of the last week have shown how fast assumptions about the world can change. It is extraordinarily difficult to predict the near term. I am glad to say we started in line with our expectations, with very strong pipelines across the main markets in which we operate. Finally, a thank you. Firstly, to our clients worldwide for their loyal support, and the same to our shareholders. Last but not least, to our global workforce for the dedication and commitment they give to serving our clients to the best of their abilities. That now completes our presentation. No fire alarms. Thank you for attending today's presentation. I will now be very happy with Simon to answer any questions you have. Thank you. Do we have any questions? Christopher. Sorry, Mike. No. Technology label. Just once around profits, operational gear again.
I suppose what I'd like to ask is, it was really good drop in the rates in the transactional business, just over 30%. Is that a sustainable level? What do you think would be the right market? Perhaps just linked to that. Look back to 2021.
I didn't mean to start again. And is $200 million a realistic prospect over the foreseeable future if we do get, you know, a slightly more normal market. That's kind of three parts.
Yeah, sure. Which bit do you want to start with?
I think if I start with the point about probably the markets first, I mean, I think, you know, we are seeing capital transaction markets have not yet fully recovered. You have to remember that there are global volumes up 10%, but still 25% behind pre-COVID averages.
You know, you can see that there is greater leverage there. I think the fact that we've maintained and grown, actually, our transactional teams in many of those core markets, that the size of the business is actually different to the size when you look back. That would give us significant headroom going forward. Simon, I know where you're at.
I do. I think you can see from the geographic spread of our performance that we're still relatively low margin in North America, and we're still making smaller, thankfully, but still making losses in continental Europe. Still very compromised markets. I reiterate my point that, in fact, there is a slide in the appendix to the PAC, which shows this completely. World volumes are way below where they were actually even in the COVID years. That will not persist.
You know, it's, as we said at the end of this presentation, near term, very short term, it's terribly difficult to predict the effect of, let's call them world events on sentiment. The underlying fundamental factors around real estate have largely corrected. I think we will see that start to improve quite significantly when the fuss dies down a bit. As to the bigger picture, in terms of drop-through, I think was another one of your questions, I don't see that that is anything other than realistic. Remembering, this is all about saying, you know, thank you shareholders for allowing us to retain bench strength through 2023 when markets were horrible, as we all know. We were retaining people because we knew they were working hard with clients who could not do anything either at the time.
We have started to see the benefits of that coming through in 2024 recovery. That will continue by definition of what I just said around world volumes. I think that is a perfectly reasonable expectation. As to longer-term margin, I think it clearly depends upon where we make our money and exactly what it is that is going on. I would expect to see us in that mid to high single digits over the next five years. You know, in a glory year, and God knows we have not had any of those for about the last decade, pretty much, in the world, that is, we could hit double digits. I am going to give Clyde, do you want to come back on? Yeah. Chris, why do you not follow up on that?
It is quite simple. Restructuring, you know, it is quite a decent sized charge.
I know some of that was transaction related. I mean, you mentioned this $3 million. Is that all we should expect for 2025 or is there much more? What are the benefits you see accruing from this financially?
Okay. I think first up, the total restructuring, both in 2023, 2024, and that $3.5 million I talked about to fall in the first quarter of this year, will yield us savings of at about a 1.6 multiple. We are paying 1.6 times the savings that we expect to get out of them. It is not an inconsiderable amount. I think once, you know, the mainstream restructuring, I think, is there and done.
We've in markets that we've been experiencing over the last 18 months, we've always got to make sure that we keep an eye on those long-term assumptions in individual markets and individual service lines and temper or tweak the sales a bit if we have to. I don't expect anything significant coming forward right now.
No, I think that's fair. I think, you know, Simon referenced, you know, mainland China, some of the European markets. I think we've done what is needed to, and we're looking at actually the opportunities for those markets to return to growth. I think that's where we are. Clyde, your chance.
Yeah, apologies. I think I've got loads, but I'll split them into two bits. European property management, when you can get a scale of how big that is, I mean, again, how material is it going to be for?
I've got to be sensitive about it, but it would be a material contributor to turning that business into a profitable business.
Thank you. The management change of EMEA? EMEA. EMEA, we call it EMEA. Right. What does that imply for the U.K. management? Because obviously, when I look at the U.K. versus Europe or EMEA, the businesses are in very different positions in terms of the maturity and the growth profile. I mean, you have the U.K. up there in terms of one of the growth markets. What's going to change, I suppose, for the U.K. business in particular, I suppose, as a result of that management structure?
I might also bring, I've got James Sparrow, who is CEO of U.K., continental Europe, Middle East here. So I will definitely ask James to contribute to this.
What I would say is that this is around, you know, the business lines that we are developing. You referenced property management as a good example. We manage in, you know, the U.K., pretty much all the major institutional portfolios for international investors. That is growing in all the European markets that we will get to maturity. In some cases, we are getting there, and in other cases, a bit further. By providing a consistent service and operating it in the same manner, that is what our clients need. The same is true if you are looking at international capital moving around those markets. They want the same level of service in all of those markets. I think that has been the driver, to ensure that we have a strategic outlook around our sectors of business. James, do you want to pick anything else up?
Thanks, Mark. Yeah, I think it's those two things. It's synergies for the business to bring the businesses closer together, but it's particularly around clients. I think the main point is that these are the same clients. They look at, they don't look at the U.K. and Europe as separate. They look at it as one. They look at it as an EMEA. I think that to really leverage our very strong position in London in particular, and that link into Europe will be a significant benefit. Now, the businesses are already well linked up, but I think we want to make them even more linked up for that reason.
Should the follow-on from that be over time you get an established more, I think, global sort of lines around property management, maybe that there wasn't just a U.K.-Europe merge, there's a U.S. sort of Asian. Okay.
100%. I think particularly you mentioned property management as one. Global residential, Justin and Victoria here. We regard the same for our residential business needs to, you know, to operate in that manner. Consistent service, you know, high-end services. I think, you know, and also the global occupier services bit I referenced, that has to be a combined platform because, you know, we are operating for the same occupier in every market. If one bit goes wrong, you know, that's a real problem to us.
Thank you. Simon sounded very excited about the acquisition pipeline. In terms of scale and in terms of geography, where's the likely sort of bias? Is it again still very much sort of bolt-ons, you know, 5, 10, 20s, or is there something larger in that pipe?
Is it again, U.S. is we've all been waiting for you to sort of follow up on the Savills deal. Something large there, is that in the mix or is there a different bias?
I'll give you sort of the generality. You're not going to expect me to tell you what we're looking at and negotiating on at the moment. The generality is, as you know, we tend to grow our less transactional businesses with M&A if the right opportunities come along. We tend to grow our transactional side through team lifts and recruitment a bit more than M&A, although some of it looks like small M&A. It's really recruitment. We've got a combination of all of that happening at the moment. I think this is not a bad moment to be doing it.
It's across all of our regions as well, whether it's EMEA now, Asia Pacific, and indeed North America. I would also suggest I gave you some of the areas that we were looking at. The only thing I would say is we've typically done little and often small bolt-ons down as little as GBP 2 million, GBP 3 million. The size we are today, that we'll still do those, but I wouldn't be probably drawing them to your attention anymore. We're probably looking at the slightly higher end of our normal range of activity at the moment. That's because the opportunities are presenting themselves, which is great.
The last time happened around competition. You already alluded to it, you kept the bench strength in 2023, and a lot of the competitors didn't. What are they now doing in terms of, you know, heads?
I mean, you talked about, you know, a number of broker recruitments across the business and building out the teams. What are they doing in those sorts of markets as well? Is competition level starting to increase? I mean, competition never went away.
That's absolutely true. But, you know, I think the point about, you know, some of those larger scale businesses, let's call it with large transactions, they did some trimming. And that affects morale. I think for us, you know, I think we are in a very strong position because, you know, you create goodwill with your teams by looking after too thick and thin. Also, the clients in particular are very loyal to you because you've looked after them in the most difficult parts of the market, overserviced them through that process. So genuinely, I'm pleased to say that we captured market share through that.
Now, we're going to hang on to it, continue to grow it. I'm not suggesting the competition's gone away. I think we're in a very good position. Simon's referenced our transactional pipelines. In many markets, they are as strong as we can ever remember through that. We've still got to turn them into revenue, not a transact, but they are very strong indeed. We are, we've done what we believe we should do, and we're in a good position.
Thanks. I mean, firstly, congratulations on a 38% increase in profit in a year that the transaction market was very difficult. I think that deserves a lot of credit. Just, yeah, sort of slightly more forward-looking, a few questions.
I know you don't give a formal guidance on earnings, but if we take consensus as sort of the reference point, you know, to get to that kind of number, do you think you need a stabilisation in particular interest rates and general volatility in the second half to get there, or could that be a number that you achieve even if the market continues to be very difficult? The second one is on the stamp duty change in the U.K. Do you see that having a skew to earnings for U.K. residential towards the first half versus the second half that you typically generate? Lastly, on the U.S., I mean, I think a $20 million increase in revenue passed through to a $12 million increase in profit.
Given the situation there, obviously, we do not know how it is going to evolve, but should the US end up in that kind of negative growth scenario that people are talking about, how much of a potential headwind is that to profit in 2025?
We are talking about in the order in which they arrived. I have now completely forgot what the first question was.
Can you get to 155 even if the thing—
oh, yes, yes, yes, yes. Yeah, yeah. I mean, I think the big issue at the moment is the big issue at the moment, which is obviously we read the newspapers and see the news and wonder what pronouncements are going to come out from where and whether they are going to do about us and this, that, and the other. That is clearly having an impact on sentiment to sign on the dotted line right now.
As I said earlier, I'm less worried about that in the longer term or in the medium term as well, particularly through the second half of the year because I think the fundamentals are there. I would argue I'm probably quite pleased right now because nobody can predict today. I'm quite pleased with a bit of a range around the expectations for the year. I don't see anything to change people's views right at this moment. No, I think that's fine.
The bit about interest rates, if I can just jump in on that, I don't think it has to be linked to, you know, a continued reduction in interest rates because whilst perhaps, you know, if we look at sometime last year, perhaps everybody was expecting it to fall faster and more reductions. I think the capital markets in particular have recalibrated.
You know, the majority of markets are now perhaps past their drop. Also, the other thing which is driving investor positive sentiment is rental growth. You know, the world of low interest rates, people forgot about rental growth, but now we've genuinely got it in many sectors. Total returns are therefore looking quite strong. I do think, and you'll see, you know, activity from major largest US investors in London right now, it's being driven by that. It's not about this sort of continuing fall of interest rates. It's more about the total returns investors can get in the sector. I think that's pretty much built in. Probably the qualification is that the markets that have the most political stability, as well as the real estate fundamentals, and we're exposed to those, will do the best.
But it's got to be a combination of both.
Yeah. I think your final point was stamp duty. I do think one of the impacts on the interest rate impact is when you've got the five-year Treasury bill flipping around 30 basis points every 24 hours, which you've seen a bit in recent weeks, that's not a stable place in which to be structuring your borrowing requirements. A bit more stability in that arena will help everybody, I think. Stamp duty, we do think, and we've got our specialists here. Yeah, Andrew, but I think the fact is generally the U.K. market tends to absorb stamp duty question quite quickly, although you do see a bit of a surge in advancement, which I think is fair to say we saw. Should we bring in Andrew Clarrow, who heads our U.K. residential business?
I think the change in stamp duty hasn't materially impacted buyer demand at the top end of the market. I think it's further down the chain. Yeah, more of more relevance is the expected reduction in interest rates. That's still a fundamental driver for domestic markets, more so than the stamp duty change. Should we ask all sections of your
U.S.? U.S., U.S. under a slowdown.
Okay. I'm going to, I'll talk about maybe just what's going on in the market maybe, and then you can talk about what we know about our business. Just reminding you, you know, we are exposed to the occupier-led markets, as I've referenced. So it is a demand-based business of discretionary capital. Of course, it can, you know, with fluctuations, it can, it can obviously, you know, be hesitant.
We are seeing, you know, continued recovery in the stronger markets in North America, occupationally, both across offices, the same sort of demands, the same, you know, supply-demand equation in some of those markets like Miami, where you're getting terrific rental growth and people are wanting more space, etc. You know, those sort of markets, Texas, etc., we're seeing, you know, continue, but also, you know, recovery in New York, Chicago. You know, I think, you know, we are seeing, you know, people getting on with it in the occupier markets and industrial logistics not dissimilar. I think, you know, in a way, the capital markets could ebb and flow. We're not particularly exposed to North American capital markets in North America. Of course, we're affected by North American investors. I think, you know, we are quite insulated.
I think it's absolutely right.
Structurally, it's the one market where our revenue producers are entirely commission-based as well. There is a sort of natural cost of Tina effect on the cost base if they don't have the revenue coming through. Thanks. Jay.
Good morning. I think in the past you've kind of called out financing as the catalyst to get the transaction side. What are you seeing on the front end moving forward? Is that kind of part of the pipeline that you've been talking about on the transactional side?
Yeah. The debt refinancing going on is still very significant. There's plenty of debt to continue to look at. I would say that equally, it's not just pure debt. It's also, you know, new equity being capitalized into product partnership. I referenced M&A activity through that process too. We are seeing that.
We do have, you know, both within our Sales Investment Management, where we, you know, have our own dedicated debt funds, which I think you might talk about. And we also have debt advisory in our existing businesses in most of the major regions we operate in. So they're very busy. I think what I would say is that liquidity is continuing to increase as funds end life, get to the end of life. There's an opportunity. You know, London is a great example where liquidity has been very good in a way. Other markets are now starting to unlock, and we're starting to see that in continental Europe, etc., as well as people reach the end of their finance period or end of life in terms of a fund. Liquidity is improving. Alex, I don't know whether you want to reference anything on the debt. Yes.
Hi, I'm responsible for the Sales Investment Management business. You may recall that we acquired DRC Capital, I think three years ago, which is now branded DRC Savills Investment Management. It's our debt investment business. You know, it's grown very successfully. It's one of the leading commercial real estate non-bank lending businesses across Europe. As Simon mentioned, we had a successful close of a Pan-European whole loans fund this year. Sorry, early last year, we're continuing to raise money for that and invest it. You know, I think it's a sweet spot really for investors that generally institutions have been somewhat reluctant to, you know, commit to real estate given the volatility. Debt seems to be higher up the agenda for people because it obviously provides that cushion, you know, downside protection if things don't go to plan.
But also, you know, the risk-adjusted returns are really attractive. The margins are higher than they were, you know, four or five years ago. Of course, the underlying interest rates are higher as well. The overall returns that are available often look better than equity on a risk-adjusted basis. You know, we're really, actually in terms of the way we manage that business, the operating margins are, you know, significantly higher than the equity side. Basically, you're not managing the underlying asset. You're just making a loan and monitoring that loan. You know, it's an area that we think has got a lot of strong growth prospects ahead.
Thank you. Okay. You're not all. Yeah. Timor actually sent me one of the technology questions. You referenced the use of technology.
Can you just give a sense of some of the things that you're doing on that side? And then just finally on national insurance, obviously there's a change coming there. How are you looking to manage through that? I guess that's mostly on the property management side.
Yeah. I'm going to do the second one first, which is obviously the national insurance increased by from April this year. We've got a half period in 2025. I'll give you the numbers. It's GBP 6 million trade-off the P&L in 2025, which obviously rises to GBP 8 million in 2026, assuming the same level of staffing, which obviously won't be true. That will be the point. It's a not inconsiderable burden. I think that's, you know, unfortunately, we just have to take it.
It is where it hits disproportionately is in the facilities management business because of the reduction of the collar from GBP 9,000 a year. We've got a lot of temporary staff, etc., or part-time, I should say, more accurately in that arena. It starts to bring those people into the net. I won't make a political observation about that, but I don't think it's helpful. Yes, it is a burden. Those are the numbers. We deal with it. Excuse me. On the technology front, popular factor, it appears we don't have microphones embedded in the ceiling at this point, which one of our chief technologists told me we did before we started this meeting. The main thrust in technology terms, and I'll use AI in there as well, but there's a lot of stuff talked about AI, which is probably not healthy.
The one thing we do have as a firm is we've got a stack of really useful data over many, many years, which we've spent a lot of time aggregating and organizing. This is over the last three or four years we've been doing it to create the platform over which you can apply machine learning, AI, etc., for specific service lines. This is all about finding ways in giving clients greater insight faster and more accurately out of this stack of data that we retain throughout our organization. That's what's happening. We're not going to be sort of running around saying suddenly these service lines are going to be done by a robot or what have you. This is about actually improving our ability to serve clients and become more efficient in so doing as well. That's really where our focus is.
Just as a note of labor between your two questions, if I may, if you look at, you know, where we are providing some of the support to property management, global occupier services, these are in markets like India, that is I referenced, because we've got, you know, good employment catchment, skilled people, obviously at a cost point, and also ensuring that we have the efficiency in our market to grow further. As much as, you know, Simon's referencing rightly, the increase in national insurance, in many of the markets that we're going to operate on a global basis, they're going to be in markets where we're going to get some benefits. You're done.
I think we are.
In which case, thank you very much indeed for coming into the office. Great to see you all in person.
If there are any other questions beyond what we've been asked today, then please let us know. Thanks very much.