CBRE Holding's unaudited pro forma financial information

Exhibit 99.3

UNAUDITED PRO FORMA COMBINED FINANCIAL INFORMATION

The following unaudited pro forma combined financial information is based on the historical financial statements of CBRE Holding, Inc. (the “Company”) and Insignia Financial Group, Inc. (“Insignia”), which was acquired by the Company on July 23, 2003 (the “Insignia Acquisition”). As applicable, the pro forma amounts presented also give effect to (1) the sale of Insignia’s real estate investment assets, which are referred to as the “real estate investment assets,” to Island Fund I, LLC immediately prior to the closing of the Insignia Acquisition in a sale transaction for net cash consideration of $36.9 million and (2) the sale by Insignia of its residential real estate services subsidiaries, Insignia Douglas Elliman LLC and Insignia Residential Group LLC, which are referred to as the “residential real estate services subsidiaries,” to Montauk Battery Realty, LLC on March 14, 2003 for net proceeds of $64.8 million in cash, after transaction costs. The unaudited pro forma combined balance sheet as of June 30, 2003 gives effect to the Insignia Acquisition and the related transactions as if they had occurred on June 30, 2003. The unaudited pro forma combined statements of operations for the twelve months ended December 31, 2002 and the six months ended June 30, 2003 give effect to the Insignia Acquisition and the related transactions as if they had occurred on January 1, 2002. All of the transactions described above are collectively referred to as the “pro forma transactions.”

This unaudited pro forma combined financial information is presented for informational purposes only and does not purport to represent what the Company’s results of operations or financial position actually would have been had the Insignia Acquisition and the related transactions in fact occurred on the dates specified, nor does the information purport to project the Company’s results of operations or financial position for any future period or at any future date. All pro forma adjustments are based on preliminary estimates and assumptions and are subject to revision upon finalization of the purchase accounting for the Insignia Acquisition and the related transactions.

Once the Company has completed the valuation studies necessary to finalize the required purchase price allocations in connection with the Insignia Acquisition and identified any changes necessary to conform Insignia’s financial presentation to its own, the unaudited pro forma combined financial information will be subject to adjustment. Such adjustments will likely result in changes to the unaudited pro forma combined balance sheet and the unaudited pro forma combined statements of operations to reflect, among other things, the final allocation of the purchase price. There can be no assurance that such changes will not be material.

The unaudited pro forma combined financial information does not reflect any adjustments for synergies that the Company expects to realize commencing upon consummation of the Insignia Acquisition. No assurances can be made as to the amount of cost savings or revenue enhancements, if any, that may be realized.

The unaudited pro forma combined financial information should be read in conjunction with the historical consolidated financial statements and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of the Company in its June 30, 2003 Quarterly Report on Form 10-Q and December 31, 2002 Annual Report on Form 10-K and the historical consolidated financial statements of Insignia included in Exhibit 99.1 of the Form 8-K of which this Exhibit 99.3 forms a part and the historical consolidated financial statements and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of Insignia in its December 31, 2002 Annual Report on Form 10-K and Form 10-K/A.

CBRE HOLDING, INC.

UNAUDITED PRO FORMA COMBINED BALANCE SHEET

As of June 30, 2003

(in thousands, except per share data)

	Historical						Pro Forma Adjustments						Pro Forma Combined
	CBRE Holding			Insignia			Disposition of Real Estate Investment Assets (a)			Insignia Acquisition			Pro Forma Combined
ASSETS
Current Assets:
Cash and cash equivalents	$	21,163		$	55,991		$	35,329		$	(20,183	)(b)(d)	$	92,300
Restricted cash		1,855			21,153			(6,599	)		—			16,409
Receivables, net of allowance		154,224			133,082			(1,577	)		—			285,729
Warehouse receivable		138,240			—			—			—			138,240
Prepaid expenses		19,623			10,547			(93	)		(1,334	)(c)		28,743
Deferred tax assets, net		19,758			—			—			—			19,758
Other current assets		14,143			—			—			—			14,143

Total current assets		369,006			220,773			27,060			(21,517	)		595,322
Cash held in escrow		200,000			—			—			(200,000	)(d)		—
Property and equipment, net		68,959			42,140			(147	)		(5,587	)(e)		105,365
Goodwill		577,137			260,565			—			(83,333	)(c)(f)(g)		754,369
Other intangible assets, net		89,494			4,684			—			97,990	(h)		192,168
Deferred compensation assets		69,533			—			—			—			69,533
Investment in and advances to unconsolidated subsidiaries		57,691			—			—			—			57,691
Real estate investments, net		—			131,411			(128,373	)		—			3,038
Deferred tax assets, net		35,972			62,086			(2,922	)		(19,016	)(i)		76,120
Other assets		94,109			12,590			(1,501	)		7,867	(j)		113,065

Total assets	$	1,561,901		$	734,249		$	(105,883	)	$	(223,596	)	$	1,966,671

LIABILITIES & STOCKHOLDERS’ EQUITY
Current Liabilities:
Accounts payable and accrued expenses	$	98,096		$	50,120		$	(7,659	)	$	22,621	(k)	$	163,178
Compensation and employee benefits payable		61,491			61,693			(7	)		—			123,177
Accrued bonus and profit sharing		49,853			13,958			(431	)		—			63,380
Income taxes payable		—			3,609			—			—			3,609
Short Term Borrowings:
Warehouse line of credit		138,240			—			—			—			138,240
Revolver and swingline credit facility		11,250												11,250
Other short term borrowings		56,149			—			—			—			56,149

Total short-term borrowings		205,639			—			—			—			205,639
Current maturities of long term debt		10,760			—			—			750	(l)		11,510

Total current liabilities		425,839			129,380			(8,097	)		23,371			570,493

Long-term Liabilities:
Senior secured term loans		206,013			—			—			74,250	(l)		280,263
Notes Payable		—			43,000			—			(43,000	)(l)		—
Real estate mortgage notes		—			71,986			(71,986	)		—			—
9¾% senior notes of CB Richard Ellis Services		200,000			—			—			—			200,000
11¼% senior subordinated notes of CB Richard Ellis Services		226,055			—			—			—			226,055
16% senior notes of CBRE Holding		63,344			—			—			—			63,344
Other long-term debt		12,320			—			—			—			12,320

Total long-term debt		707,732			114,986			(71,986	)		31,250			781,982
Deferred compensation liability		112,741			17,229			—			—			129,970
Deferred tax liabilities		—			23,396			(752	)		(22,644	)(i)		—
Other liabilities		56,836			28,763			—			26,856	(m)		112,455

Total liabilities		1,303,148			313,754			(80,835	)		58,833			1,594,900

Minority interest		6,081			—			—			—			6,081

Stockholders’ Equity:
Preferred Stock, $0.01 par value, 20,000,000 shares authorized, 250,000 Series A shares and 125,000 Series B shares issued and outstanding—actual, no shares issued and outstanding pro forma		—			4			—			(4	)(n)		—
Class A common stock; $0.01 par value; 75,000,000 shares authorized; 2,687,988 issued and outstanding (including treasury shares) pro forma.		18			—			—			9	(n)		27
Class B common stock; $0.01 par value; 25,000,000 shares authorized; 12,624,813 shares issued and outstanding—actual, 19,271,948 shares issued and outstanding pro forma		127			—			—			66	(n)		193
Common Stock, par value $.01 per share—80,000,000 shares authorized, 24,082,121 shares issued and outstanding, net of 1,502,600 shares held in treasury—actual, no shares issued and outstanding pro forma		—			241			—			(241	)(n)		—
Additional paid-in capital		241,475			443,101			—			(323,176	)(n)		361,400
Notes receivable from sale of stock		(4,762	)		(1,006	)		—			1,006	(n)		(4,762	)
Accumulated earnings (deficit)		39,978			(24,104	)		(25,048	)		42,170	(n)		32,996
Accumulated other comprehensive income (loss)		(22,272	)		2,259			—			(2,259	)(n)		(22,272	)
Treasury stock at cost		(1,892	)		—			—			—			(1,892	)

Total stockholders’ equity		252,672			420,495			(25,048	)		(282,429	)		365,690

Total liabilities & stockholders’ equity	$	1,561,901		$	734,249		$	(105,883	)	$	(223,596	)	$	1,966,671

The accompanying notes are an integral part of these financial statements.

Notes to Unaudited Pro Forma Combined Balance Sheet

as of June 30, 2003

(a)

Reflects the sale of the real estate investment assets to Island Fund I, LLC for net cash consideration of approximately $36.9 million, which gives effect to selling expenses and the assumption by Island Fund I, LLC of certain contingent obligations. This disposition was completed immediately prior to the closing of the Insignia Acquisition. Accordingly, the difference between the net proceeds from the disposition of the real estate investment assets and their historical book value has been recorded as an adjustment to Insignia’s historical equity.

Cash and cash equivalents of $35.3 million related to the disposition of the real estate investment assets consist of the following:

	(in thousands)
Historical cash and cash equivalents related to disposed real estate investment assets	$	(1,541	)
Net proceeds from the sale of the real estate investment assets		36,870

Cash and cash equivalents—real estate investment asset dispositions	$	35,329

(b)	Reflects the net effect of the pro forma transactions on cash and cash equivalents as follows:

	(in thousands)
Sources:
Additional tranche B term loan borrowings (note (l))	$	75,000
9³/4% senior notes due May 15, 2010		200,000
Equity contribution from the Company’s stockholders (note (n))		120,000

Total sources	$	395,000

Uses:
Purchase of outstanding shares of Insignia (24,108,533 shares at $11.156 per share, net of repayment of notes receivable from sale of stock, notes (f))	$	(266,903	)
Purchase of Series A and Series B preferred shares of Insignia (375,000 shares at $100.00 per share plus accrued and unpaid dividends, notes (f))		(38,244	)
Settlement of outstanding stock options and warrants of Insignia (note (f))		(7,923	)
Change of control, severance payments and other		(23,168	)
Payment of transaction costs, net of financing costs (note (f))		(16,598	)
Repayment of Insignia’s senior credit facility (note (l))		(28,000	)
Repayment of Insignia’s subordinated credit facility (note (l))		(15,000	)
Payment of financing costs (note (j))		(19,347	)

Total uses		(415,183	)

Change in cash and cash equivalents	$	(20,183	)

The Company anticipates incurring approximately $213.3 million in expenditures associated with the pro forma transactions. These expenditures include change of control payments, employee severance, facilities closure costs, retention payments, integration costs, financing costs, capital expenditures and other transaction costs. The payment schedule for, and accounting treatment of, such costs is expected to be as follows:

	Paid By Closing		Paid Over Time		Total Costs
	(in thousands)
Record as goodwill	$	41,100	$	54,620	$	95,720
Expense as incurred		1,300		74,800		76,100
Record as deferred financing costs/property and equipment		19,347		11,000		30,347
Payout of deferred compensation liability		—		11,100		11,100

Total	$	61,747	$	151,520	$	213,267

The pro forma cash and cash equivalents balance of $92.3 million as of June 30, 2003 is higher than what the Company would have had historically as of June 30, 2003. This excess cash balance is the result of the borrowing at the closing of the Insignia Acquisition and related transactions of the entire $75.0 million principal balance of the additional tranche B term loan and the release from escrow at the closing of the Insignia Acquisition and related transactions of the net proceeds from the offering of $200.0 million in aggregate principal amount of the 9¾% senior notes for purposes of the accompanying unaudited pro forma combined balance sheet. In addition, the Company has not assumed the application of the $36.9 million in net proceeds from the sale of the real estate investment assets for any particular use. The Company anticipates the incurrence of non-recurring expenditures associated with the integration of Insignia’s businesses and expects that this excess cash will be utilized to fund these integration costs.

(c)	Represents the adjustment to reflect the reclassification of transaction costs related to the Insignia Acquisition paid by the Company through June 30, 2003 (increase to goodwill).

(d)

In accordance with the terms of the indenture governing the Company’s $200.0 million in aggregate principal amount 9¾% senior notes, the proceeds from the sale of these notes were placed in escrow until the close of the Insignia Acquisition. This adjustment reflects the reclassification of these proceeds to cash.

(e)	Represents adjustment to acquired property and equipment to reflect its estimated fair market value as of the date of the Insignia Acquisition.

(f)

The Insignia Acquisition is being accounted for under the purchase method of accounting. Accordingly, the total purchase price is being allocated to the assets acquired and the liabilities assumed based upon their respective estimated fair values. A preliminary allocation of the purchase price has been made to major categories of assets and liabilities in the unaudited pro forma combined balance sheet based on the Company’s preliminary assessment. The final allocation of the purchase price may result in significant differences from the pro forma amounts included in this unaudited pro forma combined financial information.

The following represents the calculation of the purchase price of the Insignia Acquisition and the excess purchase price over the estimated fair value of net assets acquired:

	(in thousands)
Purchase of outstanding shares of Insignia, net (24,108,533 shares at $11.156 per share)	$	266,903
Purchase of Series A and Series B preferred shares of Insignia (375,000 shares at $100.00 per share plus accrued and unpaid dividends)		38,244
Settlement of outstanding stock options and warrants of Insignia		7,923
Transaction costs, net of financing costs		20,300

Total purchase price		333,370
Less: estimated fair value of net assets acquired (see table below)		(156,138	)

Excess purchase price over estimated fair value of net assets acquired	$	177,232

Preliminary allocation of the purchase price to the assets and liabilities of Insignia is comprised of the following:

	(in thousands)
Assets:
Current assets	$	247,833
Property and equipment		36,406
Other intangible assets		102,674
Other assets		9,629
Deferred tax assets, net		40,148

Total assets	$	436,690

Liabilities:
Current liabilities	$	116,084
Liabilities incurred in connection with the Insignia Acquisition		75,420
Notes payable		43,000
All other liabilities		46,048

Total liabilities		280,552

Estimated fair value of net assets acquired	$	156,138

(g)	The adjustments to goodwill are comprised of the following:

	(in thousands)
Insignia historical goodwill	$	(260,565	)
Less: Excess purchase price over estimated fair value of net assets acquired		177,232

Net pro forma adjustments to goodwill	$	(83,333	)

(h)	The adjustments to other intangible assets are comprised of the following:

	(in thousands)
Fair value of Insignia’s net revenue backlog as of June 30, 2003	$	50,000
Fair value of definite life intangible assets		27,674
Fair value of Richard Ellis trade name in the United Kingdom		25,000
Write-off of the historical book value of Insignia’s intangible assets		(4,684	)

Net pro forma adjustments to other intangible assets	$	97,990

Fair value of Insignia’s net revenue backlog as of June 30, 2003 represents the estimated backlog of Insignia’s revenue producing transactions acquired by the Company in the Insignia Acquisition. The backlog consists of commissions receivable on Insignia’s revenue producing transactions, which were at various stages of completion prior to the Insignia Acquisition. Purchase accounting rules under generally accepted accounting principles in the United States require these commissions to be recorded as an intangible asset purchased. This asset will be amortized as cash is received upon final closing of these pending transactions.

Definite life intangible assets are primarily comprised of property management contracts in the United States, the United Kingdom, France and other European operations, which will be amortized over their estimated useful lives of up to seven years. The Richard Ellis trade name in the United Kingdom, which was owned by Insignia prior to the Insignia Acquisition, is assumed to have an indefinite life and accordingly will not be amortized. The trade name will be subject to at least an annual review for impairment.

(i)

Represents the net adjustment to reflect the tax effect of the pro forma adjustments at applicable statutory rates. Deferred taxes are subject to the final appraisal and purchase price allocation to assets and liabilities other than goodwill. The adjustment also includes the reclassification of $22.6 million of Insignia’s deferred tax liabilities as a reduction to deferred tax assets to conform to the Company’s presentation.

(j)	The adjustments to other assets are comprised of the following:

	(in thousands)
Financing costs associated with debt issued in connection with the pro forma transactions	$	19,347
Fair value of Insignia’s below market leases		1,602
Write-off of deferred financing costs of the Company’s prior credit facility		(6,982	)
Write-off of deferred financing costs of Insignia’s debt to be repaid		(1,616	)
Other		(4,484	)

Net pro forma adjustments to other assets	$	7,867

Financing costs represent the Company’s estimate of transaction fees and costs directly attributable to the debt financings related to the pro forma transactions. Costs will be allocated to each debt instrument based on specific identification or as a percentage of face value, as appropriate. Such costs will be amortized over the term of the appropriate debt instrument.

(k)	The adjustments to accounts payable and accrued expenses are comprised of the following:

	(in thousands)
Write-off of Insignia’s existing net deferred revenue	$	(5,199	)
Accrued severance and other contractual obligations		17,252
Accrued facilities closure costs		8,200
Accrued transaction costs		2,368

Net pro forma adjustment to accounts payable and accrued expenses	$	22,621

The Company has recorded as a component of the Insignia purchase price the estimated costs associated with an involuntary plan of termination of certain of Insignia’s employees. This plan was implemented concurrently with the closing of the Insignia Acquisition. The Company has also recorded as a component of the Insignia purchase price the estimated cost to exit duplicate facilities of Insignia. These accruals have been recorded in accordance with EITF 95-3.

(l)	Reflects the incurrence and repayment of debt as follows:

	(in thousands)
Non-current portion:
Additional tranche B term loan borrowings	$	74,250
Repayment of Insignia’s revolving credit facility		(28,000	)
Repayment of Insignia’s subordinated credit facility		(15,000	)

Adjustment to non-current portion of long-term debt	$	31,250

Current portion:
Current portion of additional tranche B term loan borrowings	$	750

Adjustment to current portion of long-term debt	$	750

In connection with the Insignia Acquisition, the Company entered into an amended and restated credit agreement with Credit Suisse First Boston (“CSFB”) and other lenders. The Company’s previous credit facility was, and the amended and restated credit agreement continues to be, jointly and severally guaranteed by the Company and its wholly owned domestic subsidiaries and secured by substantially all of their assets. The amended and restated credit agreement includes a tranche A term facility of $50.0 million (which was fully drawn in connection with the acquisition of CB Richard Ellis Services, Inc. by the Company in 2001 (the “2001 Merger”)), maturing on July 20, 2007; a tranche B term facility of $260.0 million ($185.0 million of which was drawn in connection with the 2001 Merger and $75.0 million of which was drawn in connection with the Insignia Acquisition), maturing on July 18, 2008; and a revolving line of credit of $90.0 million, including revolving credit loans, letters of credit and a swingline loan facility, maturing on July 20, 2007. After the amendment and restatement, borrowings under the tranche A and revolving facility bear interest at varying rates based, at the Company’s option, on either the applicable LIBOR plus 3.00% to 3.75% or the alternate base rate plus 2.00% to 2.75%, in both cases as determined by reference to the ratio of total debt less available cash to EBITDA, which are defined in the amended and restated credit agreement. Pursuant to the amended and restated credit agreement, borrowings under the tranche B facility bear interest at varying rates based, at the Company’s option, on either the applicable LIBOR plus 4.25% or the alternate base rate plus 3.25%. The alternate base rate is the higher of (1) CSFB’s prime rate or (2) the Federal Funds Effective Rate plus one-half of one percent.

(m)	The adjustments to other long term liabilities are comprised of the following:

	(in thousands)
Accrued facilities closure costs	$	20,900
Accrued severance and other contractual obligations		5,900
Fair value adjustment for Insignia’s above market leases		2,525
Write-off of Insignia’s existing net deferred rent expense		(2,469	)

Net pro forma adjustment to other long term liabilities	$	26,856

(n)

Represents the elimination of Insignia’s historical equity (after adjustments for dispositions) and the issuance of 852,865 shares of Class A common stock, $0.01 par value per share, of the Company and 6,647,135 shares of Class B common stock, $0.01 par value per share, of the Company to certain stockholders of the Company as follows:

	(in thousands)
Elimination of Insignia’s equity:
Insignia’s historical preferred stock	$	(4	)
Insignia’s historical common stock		(241	)
Insignia’s additional paid-in capital		(443,101	)
Repayment of notes receivable from sale of stock		1,006
Insignia’s accumulated deficit		49,152
Insignia’s accumulated other comprehensive income		(2,259	)

Pro forma adjustments to Insignia’s historical equity	$	(395,447	)

Adjustments to the Company’s equity:
Issuance of Class A common stock	$	9
Issuance of Class B common stock		66
Additional paid-in capital		119,925
Accumulated earnings (write off of deferred financing costs of prior credit facility)		(6,982	)

Pro forma adjustments to the Company’s equity	$	113,018
Net pro forma adjustments to equity	$	(282,429	)

The net decrease in additional paid-in capital of $323.2 million is comprised of the elimination of Insignia’s additional paid-in capital of $443.1 million, offset by the increase in additional paid-in capital of $119.9 million associated with the equity issued to stockholders of the Company. Certain stockholders of the Company provided $120.0 million in equity to fund a portion of the Insignia Acquisition through the purchase of 852,865 shares of Class A common stock, $0.01 par value per share, of the Company and 6,647,135 shares of Class B common stock, $0.01 par value per share, of the Company, in each case at $16.00 per share in cash.

CBRE HOLDING, INC.

UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS

For the Twelve Months Ended December 31, 2002

(in thousands, except share data)

	Historical						Pro Forma Adjustments						Pro Forma Combined
	CBRE Holding			Insignia			Dispositions (a)			Insignia Acquisition			Pro Forma Combined
Revenue	$	1,170,277		$	721,223		$	(147,338	)	$	—		$	1,744,162

Costs and expenses:
Cost of services		554,942			—			—			—			554,942
Operating, administrative and other		493,949			—			—			—			493,949
Cost and expenses—Insignia		—			669,067			(137,651	)		222	(b)		531,638
Depreciation and amortization		24,614			24,661			(6,413	)		317	(c)		43,179
Equity income from unconsolidated subsidiaries		(9,326	)		(3,482	)		3,482			—			(9,326	)
Merger-related charges		36			—			—			—			36

		1,064,215			690,246			(140,582	)		539			1,614,418
Operating income		106,062			30,977			(6,756	)		(539	)		129,744
Interest income		3,272			3,951			(44	)		—			7,179
Interest expense		60,501			10,992			(2,138	)		20,983	(d)		90,338

Income from continuing operations before provision for income tax		48,833			23,936			(4,662	)		(21,522	)		46,585
Provision for income taxes		30,106			10,719			(2,103	)		(8,609	)(e)		30,113

Income from continuing operations	$	18,727		$	13,217		$	(2,559	)	$	(12,913	)	$	16,472

Basic earnings per share from continuing operations	$	1.25											$	0.73

Weighted average shares outstanding for basic earnings per share		15,025,308												22,525,308	(f)

Diluted earnings per share from continuing operations	$	1.23											$	0.72

Weighted average shares outstanding for diluted earnings per share		15,222,111												22,722,111	(f)

The accompanying notes are an integral part of these financial statements.

Notes to Unaudited Pro Forma Combined Statements of Operations

for the Twelve Months Ended December 31, 2002

(a)

Reflects the elimination of the historical results of (1) the residential real estate services subsidiaries, which were sold to Montauk Battery Realty, LLC on March 14, 2003, and (2) the real estate investment assets, which were sold to Island Fund I, LLC immediately prior to the closing of the Insignia Acquisition. For purposes of the unaudited pro forma combined statement of operations, these dispositions were assumed to have occurred on January 1, 2002.

(b)	This adjustment represents incremental pro forma deferred rent expense resulting from the recalculation of deferred rent expense from the assumed Insignia Acquisition closing date of January 1, 2002.

(c)

This increase is comprised of pro forma amortization expense related to Insignia’s property management contracts established in purchase accounting over their estimated useful lives of up to seven years, partially offset by the reversal of Insignia’s historical amortization expense. In addition, depreciation expense was adjusted as a result of fair value adjustments to property and equipment.

(d)	The increase in pro forma interest expense as a result of the pro forma transactions is summarized as follows:

	(in thousands)
Interest on $200.0 million in aggregate principal amount senior notes at 9¾% per annum	$	19,500
Interest on $75.0 million in additional tranche B term loan borrowings at LIBOR plus 4.25% (1)		4,573
Additional 0.50% interest rate margin on existing senior secured term loan facilities		1,249
Incremental revolving credit facility loans at LIBOR plus 3.75% (1) (2)		1,092
Amortization of deferred financing costs over the term of each respective debt instrument		2,995
Incremental commitment and administration fees		231

Subtotal		29,640
Less: historical interest expense of Insignia		(5,760	)
Less: historical amortization of deferred financing costs of the Company (prior credit facility)		(1,711	)
Less: historical amortization of deferred financing costs of Insignia		(1,186	)

Subtotal		(8,657	)

Net increase in interest expense	$	20,983

(1)

For purposes of the calculations above, LIBOR is based on the average three month LIBOR rate for fiscal year 2002.

(2)

The incremental revolving credit facility loans reflect the difference between Insignia’s outstanding revolving credit facility balance as of December 31, 2002 of $95.0 million and the amounts outstanding in excess of $95.0 million during 2002 (the amount that was repaid from the proceeds of the pro forma transactions). Such excess was assumed to be financed under the Company’s existing credit facility at LIBOR plus 3.75%.

(e)	Represents the tax effect of the pro forma adjustments included in notes (a) through (d) above at the respective statutory rates, excluding some items that are permanently non-deductible for tax purposes.

(f)	Reflects the pro forma number of weighted average shares giving effect to the 852,865 shares of Class A common stock of the Company and 6,647,135 shares of Class B common stock of the Company issued in connection with the Insignia Acquisition.

CBRE HOLDING, INC.

UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS

For the Six Months Ended June 30, 2003

(in thousands, except share data)

	Historical						Pro Forma Adjustments						Pro Forma Combined
	CBRE Holding			Insignia			Disposition of Real Estate Investment Assets (a)			Insignia Acquisition			Pro Forma Combined
Revenue	$	585,441		$	285,606		$	(5,481	)	$	—		$	865,566

Costs and expenses:
Cost of services		276,665			—			—			—			276,665
Operating, administrative and other		263,596			—			—			—			263,596
Cost and expenses—Insignia		—			280,850			(7,631	)		122	(b)		273,341
Depreciation and amortization		12,500			8,946			(788	)		1,022	(c)		21,680
Equity (income) loss from unconsolidated subsidiaries		(6,864	)		3,318			(3,318	)		—			(6,864	)
Merger-related charges		3,310			4,885			—			(4,885	)(d)		3,310

		549,207			297,999			(11,737	)		(3,741	)		831,728

Operating income (loss)		36,234			(12,393	)		6,256			3,741			33,838
Interest income		1,776			1,646			—			(260	)(e)		3,162
Interest expense		31,264			4,134			(841	)		8,531	(f)		43,088

Income (loss) from continuing operations before provision (benefit) for income tax		6,746			(14,881	)		7,097			(5,050	)		(6,088	)
Provision (benefit) for income taxes		2,921			(5,208	)		2,923			(2,020	)(g)		(1,384	)

Income (loss) from continuing operations	$	3,825		$	(9,673	)	$	4,174		$	(3,030	)	$	(4,704	)

Basic earnings (loss) per share from continuing operations	$	0.25											$	(0.21	)

Weighted average shares outstanding for basic earnings (loss) per share		15,035,075												22,535,075

Diluted earnings (loss) per share from continuing operations	$	0.25											$	(0.21	)

Weighted average shares outstanding for diluted earnings (loss) per share		15,321,994												22,535,075

The accompanying notes are an integral part of these financial statements.

Notes to Unaudited Pro Forma Combined Statements of Operations

for the Six Months Ended June 30, 2003

(a)

Reflects the elimination of the historical results of the real estate investment assets, which were sold to Island Fund I, LLC immediately prior to the closing of the Insignia Acquisition. For purposes of the unaudited pro forma combined statement of operations, these dispositions were assumed to have occurred on January 1, 2002.

(b)	This adjustment represents incremental pro forma deferred rent expense resulting from the recalculation of deferred rent expense from the assumed Insignia Acquisition closing date of January 1, 2002.

(c)

(d)

Per Rule 11-02 of Regulation S-X, the pro forma combined statement of operations shall disclose income (loss) from continuing operations before nonrecurring charges or credits directly attributable to the transaction. Accordingly, this adjustment removes such charges for the pro forma combined statement of operations. Insignia’s historical merger costs represent professional fees incurred related to the Insignia Acquisition.

(e)

Represents the reversal of historical interest income earned by CB Richard Ellis Services on the net proceeds from the $200.0 million in aggregate principal amount 9¾% senior notes held in escrow from May 22, 2003 through July 23, 2003, the date of the closing of the Insignia Acquisition. The net proceeds held in escrow were released to CB Richard Ellis Services upon consummation of the acquisition.

(f)	The increase in pro forma interest expense as a result of the pro forma transactions is summarized as follows:

	(in thousands)
Interest on $200.0 million in aggregate principal amount senior notes at 9¾% per annum	$	9,750
Interest on $75.0 million in additional tranche B term loan borrowings at LIBOR plus 4.25% (1)		2,100
Additional 0.50% interest rate margin on existing senior secured term loan facilities		580
Amortization of deferred financing costs over the term of each respective debt instrument		1,497
Incremental commitment and administration fees		174

Subtotal		14,101
Less: historical interest expense of the Company for $200.0 million in aggregate principal amount 9¾% senior notes		(2,167	)
Less: historical interest expense of Insignia		(1,667	)
Less: historical amortization of deferred financing costs of the Company (prior credit facility & 9¾% senior notes)		(1,001	)
Less: amortization of deferred financing costs of Insignia		(735	)

Subtotal		(5,570	)

Net increase in interest expense	$	8,531

(1)

For purposes of the calculations above, LIBOR is based on the average three month LIBOR rate for the six months ended June 30, 2003.

(g)	Represents the tax effect of the pro forma adjustments included in notes (a) through (f) above at the respective statutory rates, excluding some items that are permanently non-deductible for tax purposes.

(h)	Reflects the pro forma number of weighted average shares giving effect to the 852,865 shares of Class A common stock of the Company and 6,647,135 shares of Class B common stock of the Company issued in connection with the Insignia Acquisition.