Welcome to FirstService Corporation's third quarter earnings 2010 conference call. Legal counsel requires us to advise that the discussion scheduled to take place may contain forward-looking statements that involve risks and uncertainties. Actual results may be materially different from those contained in these forward-looking statements. Additional information concerning factors that could cause actual results to materially differ from those in the Form 10-K and in the company's other filings with Canada and US Securities Commission. As a reminder, today's call is being recorded and today is Wednesday, October 27, 2010. At this time, for opening remarks and introductions, I would like to turn the call over to the Founder and Chief Executive Officer, Mr. Jay Hennick. Please go ahead, sir.

Thank you, and good morning, everyone. As the operator said, I'm Jay Hennick, the Chief Executive Officer of the company. With me today is Scott Patterson, President and Chief Operating Officer, and John Friedrichsen, Senior Vice President and Chief Financial Officer. This morning, FirstService reported very solid third quarter results. Revenues were up 18% for the quarter; adjusted EBITDA of 5% and adjusted earnings per share was up slightly versus the prior year quarter. For the nine-month period, revenues were up 16%, adjusted EBITDA up 14% and adjusted earnings per share up 7%. And finally, our cash flow, another very important indicator of our success continued to be very strong up 32% versus the prior year quarter. John will provide full details on our financial results in a few minutes. Overall, as I said we're pleased with our third quarter results. Colliers International demonstrated very strong revenue growth in the United States, Canada, Australia and Asia while continuing to invest in its brand and in its global platform. Revenues in residential property management and property services also grew relative to the prior year period despite more difficult market conditions. Scott will expand on all of this in his operational report following shortly. Since gaining control of Colliers at the end of 2009, FirstService initiated a massive re-branding effort to create brand consistency on a worldwide basis. Many of you will recall seeing Colliers signage co-branded with many different local names in many different markets. We are in the process of transitioning away from this to one uniform Colliers International name brand providing singular and consistent branding in all 61 countries where we operate. We decided to undertake this initiative because we believe the Colliers International brand offers tremendous potential for the future. Colliers International is not only the third most…

Thank you, Jay. Despite an elevated level of continuing economic uncertainty in most of our major markets, FirstService reported solid overall results in our third quarter ended September 30th. Our service line diversification continues to provide us with an edge in dealing with this uncertainty and also allowing us to take advantage of the varied pace of economic recovery and improve our market positions. Due to our long-term track record and entrepreneurial culture, we continue to make decisions with balanced short-term results with creating long-term value. Here the highlights of our consolidated results for the quarter, revenues were $530.4 million, up 18% from $451.1 million in our third quarter last year with internal growth of 13%, 2% related to foreign exchange and 3% on the Canada acquisitions. Adjusted EDITDA totaled $45.7 million, up from $43.5 million last year with the margin coming in at 8.6% versus 9.6% last year. And our adjusted diluted earnings per share came in at $0.61 versus $0.60 last year. GAAP EPS for the quarter was $0.18 compared to $0.16 for the same quarter last year. But the difference between GAAP and adjusted EPS predominantly related to the change in value of our non-controlling interests, charges related to acquisition accounting and amortization of intangibles and a further tax valuation allowance relating to tax loss carry forwards in our Colliers International operations in US and Central and Eastern Europe, all of which are outlined in our press release issued this morning. Before commenting on our quarterly cash flow and balance sheet, I’d like to make a couple of additional comments relating to our consolidated operating results. Firstly, in regard to our adjusted EBITDA, our results for the quarter were negatively impacted by $2 million relating to re-branding cost in our Colliers business. And if not for these…

Thank you, John. Let me start my review with our largest division, commercial real estate, where revenues for the quarter were $222.7 million, up 42.8% from the third quarter of 2009. Adjusting for FX, fluctuation revenues were up 36%, 32% organically. The strong results were driven by significant gains in the US, Canada, Asia and Australia, tempered by flat results in Latin America and modest net declines in Europe. Improved market conditions and transaction activity in most regions that we operate led to dramatic increases in brokerage revenues relative to the soft third quarter of 2009. In the aggregate, sales and leasing revenues were up approximately equally, both over 50%. We also experienced strong increases in appraisal and property management revenues in all our major markets. Let me now spend a minute focusing on each of our major regions. In the Americas, revenues were up 48% driven by very strong year-over-year gains in the US of close to 60%. Canada also posted strong growth of 40%, well as mentioned above Latin America was approximately flat with the year ago. Growth in the US was driven primarily by an increase in growth projectivity, particularly in New York City, Boston and our West Coast offices. Consistent with our June quarter, each of our US offices showed some level of growth relative to the prior year. In Canada, the strong results were led by growth in our major markets, Toronto, Vancouver and Calgary. Our margin in the Americas for the third quarter was mid single digit, similar to the prior year quarter. There were several factors during the quarter, which offset the operating leverage that we would normally expect to see with 48% revenue increase. More significant is that on average in US and Canada, our brokers were hitting higher commission splits compared…

(Operator Instructions) Our first question comes from Sara O’Brien with RBC Capital Markets, please go ahead. Sara O’Brien – RBC Capital Markets: The commercial real estate margins, you mentioned there is a, the $2 million in re-branding cost. But in terms of operating leverage given that the volumes were up so much, can we see that margin tick up in either the back half or I guess the last quarter this year into F ‘11 or do we have to wait in to sort of F ’11, late timeframe to see that pick up?

Well, I’ve made the comment that this quarter we are also impacted by increased splits in Canada and US as a result of the significant revenue increase. We will see that for a certain extent in the fourth quarter, but we will also see another large increase in revenues that we expect will realize leverage on. So our margins in the fourth quarter will be higher than the third and comparable to prior year. In 2011, we will definitely see higher margins than in 2010. Sara O’Brien – RBC Capital Markets: Okay, great. Just wondered on the field asset service, you mentioned volumes to be down, sort of 10% to 20% in last quarter, how much operating leverage do you gain in that? Should we expect the margin in the segment to come down significantly because of those delays?

No. We’re expecting that our margins will remain comparable to the September quarter. That business has quite a bit of variability in it. Right now, they’ve set themselves up to respond to increasing volumes and declines based on what they have experienced the last three quarters. Sara O'Brien – RBC Capital Markets: Okay, great. And just wondered, in terms of corporate expenses, a little higher than I would have expected at $5.4 million. What kind of a run rate do you expect going forward into F 11 for that?

: Sara O'Brien – RBC Capital Markets: Okay.

Thank you. Our next question comes from Dave Gold with Sidoti. Please go ahead. Dave Gold – Sidoti: Hi, good morning.

Good morning Dave. Dave Gold – Sidoti: So, a couple of things. One, I was hoping on field, if you can give a little bit more of a sense then for essentially the way things have stopped. I understand you can give 30 to 60 days or maybe a little longer based on year end. But basically if they have to start over, how does that truly affect you in basically confidence in adjusting that 30 or 60-day delay?

Well Dave, the comments that we are providing today are really from our clients. We are harassing them, staying very close to them. There is clearly a great deal of uncertainty right now around this issue. But we are providing the best information that we have and the best information that they have. They have restarted their foreclosure process and our expectation is that saving except for the holiday season, we would be back into it for more in the summer. The holiday season will likely temper that, but so at this point we’re expecting to start 2011 at higher levels. But again, we’ll know better in our year-end call and we’ll provide more clarity if we have it. Dave Gold – Sidoti: Okay. Can you give us a better sense to remind me at what point in the process usually they hire you?

When they’re foreclosed. Dave Gold – Sidoti: Okay, so at the end?

And when the owners are out of their home. Dave Gold – Sidoti: I see, okay. Got it. And then, I guess the other question in there, on the branding that still left to be done in the [Inaudible] site, what work is left to be done there in order of magnitude, as we talk about this revenue in the first half of next year. Is this a good run rate the $2 million a quarter?

I think that’s a number you can use going into, for the balance of this year and into the first half of next year, which I would I guess in aggregate total about six. That would be a good number; it will be in the five to six range, and it’s been rolled out globally, so region by region. Dave Gold – Sidoti: Got it. Okay, that’s it for me. Thanks.

You’re welcome.

Thank you. Our next question comes from Frederic Bastien with Raymond James. Please go ahead. Frederic Bastien – Raymond James: Hi guys.

Hello Frederic Bastien – Raymond James: Just wondering if you expect to have any growth on a year-over-year basis with respect to the franchise businesses?

In the fourth quarter? Frederic Bastien – Raymond James: Yes.

Yes. I think we expected there will be continued year-over-year growth for the foreseeable future slow and consistent Frederic Bastien – Raymond James: So that should have set some of the, some of the losses you’re expecting from FAS? I guess that will offset any risk.

Our fourth quarter, we still believe our revenues is, based on the information we have today will be comparable to our last year 2009 fourth quarter. Frederic Bastien – Raymond James: Okay, thanks. And my other question relates to Colliers. Are there any key markets in the U.S where you still not have a presence, and whether you’re expecting to be moving in that direction in a short term?

Well we’re very active obviously in all activities in the U.S. We’re now present, Chicago as the last key market and that’s come on board two quarters ago. So, we are strongly represent virtually everywhere in every major market. There are some secondary markets that we want to fill out just to provide consistent service delivery across the board and we’re going to do that through licensing as oppose to actually opening those markets, because long term it’s probably the best way to operate them. There maybe one or two interesting additional opportunities to add a key market as a company owned operation, we will see how things transpire over the next couple of quarters, but we’re covered everywhere now. Frederic Bastien – Raymond James: And would you mind providing a little bit more color on the key market you would like to improve or enhance your presence in?

No, that’s not something that, that’s not ... Frederic Bastien – Raymond James: I thought I’d try. Thank you.

Thank you. Our next question comes from Stephen MacLeod, and he is with BMO Capital Markets. Please go ahead. Stephen MacLeod – BMO Capital Markets: Thanks, good morning guys.

Good morning, Stephen.

Good morning. Just a couple of questions for you on the Colliers side, you have this brand reinvestment that you’re, not reinvestment brand investment that you’re doing right now. Can you just clarify; sort of what the numbers are expected to be over the next three quarters? If it is 2 million a quarter, that’s probably a good run rate.

Yes.

Okay. Are you able to talk a little bit about what kind of positive impacts you’re beginning to see from the re-branding investment that you already put through?

Good question. It is actually been a huge momentum gain, you can see by the results this past quarter in the U.S. relative to our peers. I think we’re gaining share in many markets. The consistent Colliers branding is helping considerably with recruiting. It’s helping us with client, new client wins, because it’s a clear and consistent story and that’s one of the reasons why we decided that we would incur the expenditures that we have on upgrading the branding company-wide. We’re talking a lot about the branding, but branding also includes marketing materials, it includes online presence, it includes a whole variety of things that help to create a one Colliers and we really started to some degree a step behind everyone else, as I said in my comments, because up until now in the U.S. there were some markets that we didn’t know that carried on business using a local name. So it was Colliers X or Colliers Y and so creating one Colliers with the consistent platform has made a big difference in all the areas I mentioned and I think it’s going to continue to make a big difference in the quarters ahead. So, we’re really looking forward to continuing to generate significant revenue growth quarter-after-quarter, particularly in the U.S. over the next year or so and stay tuned and hopefully we can deliver that.

Okay. And regionally, do you see the Colliers re-branding getting more traction in different markets relative to others?

Well, in most cases and not most cases, in all cases where we owned the market and we own Colliers now in 42 countries, it always carried on business has Colliers International. So, the re-branding in the U.S., the benefits there and of course, we only own 29.9% of the U.K. Both the U.S. and the U.K. market are markets that drive business to other global regions, and so as we continue to have a uniform presence and market ourselves in the U.S. and the U.K. under a common brand, we hope that will translate into additional business for us in some of our other offices around the world and it is now.

Okay. That’s great. And continuing on the Colliers business, Scott you mentioned that in the U.S. and Canada you saw a higher broker commissions splits, is that something that is expected to change over the next 12 to 18months or sooner?

No, it’s a trend that we normally see from the first to second to third quarter, as brokers achieve higher revenue thresholds; they generally achieve higher splits in their favor. We saw it from prior year third quarter to this year, because of the significant revenue increase. So, we had much higher number of brokers and achieving higher splits this year. So, it’s not going to change over the next year, the trends will remain the same and they are really dependent on revenue going.

Okay. So that it accumulate through the year?

Right.

Okay. And then finally looking at the property services business FAS specifically, if, you have a stoppage in foreclosure volumes that are coming into the system right now. Can you talk about some of the other services that you are providing are you able to continue to maintain a level of revenues through maintenance and ongoing services for the property?

Well, if the homes aren’t selling, the foreclosed homes that we currently managed don’t sell we’ll continue to earn revenue on managing those properties, but ultimately we need new files and that’s what drives the business. So, if the file stops, then slowly our revenue will decline as our homes are sold.

Okay. Thanks and I will get back in line.

Okay.

Thank you. Our next question comes from Brandon Dobell and he is with William Blair. Please go ahead.

Thanks. You may have though o this before, I hoped on late, but any commentary about the pipeline of new contracts in the residential property services business, like managing those communities. I haven’t heard much about that beyond those two acquisitions you guys made, any commentary about organic growth in that business?

The market really isn’t growing, residential property management. There has been no new development to speak off for the last couple of years. So the growth is slowed and it becomes a market share gain. We are certainly winning new contracts, particularly larger associations and high-rise more complex properties where we bring a competitive advantage. But it’s also become a very, very competitive market and we’re losing contracts at the same time, primarily due to price, and they tend to be a smaller contract. So, we continue to grow. You saw a 1% this quarter. We expect organically 1%. Next quarter, we expect similar results. But until the market starts to grow again, it will not increase significantly. Brandon Dobell – William Blair: Any change in the tone of conversations with some of your subsidiaries about the option to put back remaining ownership to you or for you guys to purchase that remaining ownership, just given the, kind of the health or relative lack of health for these business segments that you guys have, or is it just kind as usual with the managers are running those businesses…?

Well, you recall the 18 months ago, we had a larger number of minority shareholders, all in the commercial real estate segment, wanting to monetize some of their investments. The way our deals are all structured, as you know Brandon, you can only put one third of your equity to us with at any given time, but generally speaking our businesses, other than commercial real estate are so recurring and they’ve grown year-over-year and they are such cash flow generating businesses, share value consistently grows year-after-year. So, unless somebody needs additional capital to do something, their best investment is to leave it right here in their operating business. It’s very interesting to note that we’ve had multiple calls from others in their commercial real estate space looking for opportunities to increase their equity stake in commercial real estate, which may send some messages to us all that thing seem to be changing. But I would say that the ownership of the various businesses will remain pretty much the way they are, unless we take some alternate steps, but I would say it will remain the same. Brandon Dobell – William Blair: Okay fair enough. And then, I wanted to go back to the broker commission put question for a second. I understand that there is a through the year increase based on volumes and multipliers, but is there a structural change in those split, so as the cycle improves just see the top level of those splits go up as it change with the re-branding efforts, consolidation efforts. Do you see any major changes on how you’re paying the majority of the brokers, especially in the U.S., but also in Europe?

There’s no structural change. All our deals, particularly with all the new recruits are consistent, and they cap at a certain level. There are some legacy deals that remain at higher levels, but I think when the market comes back, we’ll see our commission expands will be lower than it was in 2007 for example. So, we are managing it down and there is no original structural changes market increases. Brandon Dobell – William Blair: And a final question. Within Colliers is the consolidations of the branding effort, do you think that’s a necessary condition for you guys to have in placed before you take a look at the investor management business maybe a bigger stark or a present property management, or do you think you can explore those opportunities either through acquisition or through recruiting without having all the Colliers brands in all sort of way, come in next year?

Well I mean, you’re saying a lot of things, and I agree with each one of them. The branding is critical, its have a huge, it’s made a huge difference to us in terms of recruiting and new client wins. We think it will continue to do that. It’s also helped us with acquisition opportunities. There is some licensing in some secondary markets, which would love to be owned operations as opposed licensed operations and so we think that from the standpoint of having a stronger more consistent brand we win on all those areas. Property management is code of what we do. If you look at property management FirstService why, we probably do pretty close to $1 billion in property management which is more recurring than most of our peers and if you have both our Resi and our commercial management operations together. So we understand property management. We think having the stronger brand is accelerating the growth on the commercial side of our property management, not withstanding the comments earlier on the Resi side. So, I think that should benefit. Investment Management is an interesting area of discussion, it’s strategic, and it’s something that we talk about all the time. The reality is our clients don’t want us to be in, asset management, they see it as a massive conflict and it is frankly a conflict and it could be a conflict that could be managed, but it’s a conflict notwithstanding and our current thinking although we are always looking at strategic options, our current thinking is that’s one of the differentiators of Colliers versus its pears. It is not in the investment business, it is not going to be a competitor to our clients, and I think that’s a differentiator that the more we communicate to our potential clients will translate into additional opportunities for us.

To ask a follow up question form Sara O'Brien with RBC Capital Markets. Please go ahead.

Hi, just wondered Scott, maybe if you could talk on the commercial real estate platform, what are your expectations for growth growing forward? I mean I know it’s a little early to talk about F’11, but I guess my sense was you guys were still a little bit cautious going into the next year. Wonder how that plays out in terms of your acquisition appetite going forward from here?

Well I won’t comment on acquisitions, I will let Jay do that, but I think that we have positive trends in most of our regions. We are waiting for Central and Eastern Europe to match some of the growth we are seeing in our other regions. But we would expect that to continue into 2011, but I think we will expect the level of growth to be much more modest that we’ve seen this year.

Okay

Which still translate into, we are quite at its early days, but 2011 should be a much better year overall in commercial real estate than 2010 at least that’s our hope. In terms of acquisitions; look our leverage ratios are extremely low. We are ready willing and able to find the right opportunity, we always operated on our one step of the time kind of philosophy and so there is a lot of activity out there, and we’ll capitalize when the time is right. In the mean time we’ll use our cash flow are to continue to pay down or debt as John indicated and having leverage ratios in the low ones, pretty low. So, we’re quite excited about having the capital strength to capitalize, if it’s the right opportunity there.

Okay, great. And then just a couple of small net piggy ones, but tax rate it’s been in sort of the high 40th past couple of quarters. I guess when we take out the valuation allowance it’s down to about 21%. What do you guys use or what should we use in our models for kind of a regular or normalized tax rate going forward?

Probably about 28%, 28% to 30%, I wish we can put our final point on it, but that range would be consistent with where we see it this year and going forward.

Okay, great. And then one last one just on property management, I am not sure if you addressed it, but the 100 basis points lift in margin, any reason for that? Is that national accounts or what give you the list in this quarter and is it sustainable?

It wasn’t quite a 100, it was 60.

Okay.

But it was good to see just a little mix. Some of the landscaping business that we’re losing frankly as low margin and provide some favorable mix change and we do continue to expand our collection business, which is a higher margin business for us.

Okay. Great, thanks a lot.

You have another question from Stephanie Price and she is with CIBC, please go ahead. Stephanie Price – CIBC: Good morning.

Good morning. Stephanie Price – CIBC: First, you announced a major corporate real estate services contract at the end of July with a restaurant chain. Could you talk about why Colliers was chosen and who you were competing against and what you are seeing in that market?

Oh boy, Stephanie, why do you have to talk about that restaurant chain? Stephanie Price – CIBC: I didn’t name it by name.

Can we talk about AT Kearney; can we talk about [Inaudible] can we talk about some of the thought leaders that we’ve been successful winning over the past couple of quarters? No, we have to talk about the losers. Actually, I’m demeaning it a little bit only because it creates a laugh for people, but Hooters [ph] is growing exponentially outside of the U.S. It’s creating great opportunities for us in markets that really value U.S. brands, happens to be a subject matter that is always a feeling to at least have of the population out there. So, we’re excited about winning that business and we’re excited about working with the Hooters people who are very aggressively trying to grow their business. Stephanie Price – CIBC: And can you give us sort of an indication of who you are competing against or what Colliers were chosen?

Well, I think it was chosen primarily because when you look at the global footprint of Colliers and you compare it to others we have consistently stronger operations in some of the markets where Hooters wants to go to. Asia, extremely strong in so many Asian markets, and Eastern Europe and Southeastern Europe also, and having a presence there, dots on the map had made a big difference I think in the selection of us versus others. Stephanie Price – CIBC: Moving on to residential property management, and just with the national accounts part of it. Is there any cross opportunities between that and FAS?

There is cross opportunities between that and FAS. It’s not material in the overall schema things, but what FAS does for our properties that we wrench on behalf of the banks, is it does some of the field services, so it will do through it’s contract and network it will do some of the landscaping, it will do some of this, the swimming pool service and inspections to some degree as well on a monthly basis. So, there is some crossover revenue and it’s been very helpful, I think to the property management guys having a feed on the street in so many markets and so many independent contractors through FAS that we can call on to get the job done. Stephanie Price – CIBC: And just again the residential property management, I noticed they Grubb & Ellis also our putting forward the national residential property management offering. Can you kind of talk about the impact on FAS and maybe a bit more broadly to Brandon’s question different competition in that market?

I am sorry; I didn’t hear all of that. Could you give me that question again? Stephanie Price – CIBC: No problem, Grubb & Ellis announced a national residential property management offering during Q3 and I am just wondering about the impact on FirstService and also, and it is more broadly competition in that market.

Well, we are the market leader in that space, it’s nice to see that they have the side a bit residential property management as a good area for them to pursue. They are focused from what we understand is more on the rental apartment side of the business which we do, also but I think theirs is an initiative focused primarily on managing and renting apartments for institutions. Stephanie Price – CIBC: Okay. Great. Thank you very much.

Welcome.

Thank you. We have another question from Stephen MacLeod with BMO Capital Markets. Please go ahead. Stephen MacLeod – BMO Capital Markets: Thanks. I just wanted to clarify one thing. John when you are talking about the tax rate you mentioned 28% to 30%, so is that a normalized tax rate excluding the deferred tax valuation allowance?

Yes, that’s right. Stephen MacLeod – BMO Capital Markets: Okay. And what is your outlook for the deferred tax valuation allowance going forward?

Well, our effort is to get rid of that thing obviously and utilize these losses and once we have sustainable taxable income, which is always the same as accounting income, but when we have sustainable taxable income, we will be in a position to utilize the losses and then also to remove this allowance. So that’s something that’s out there, whether or not 2011 or in the 2012 we all know, but certainly if the Colliers contains to deliver and participate in this recovery that we would expect and would be able to utilize and get rid of that in ’11 or probably 2012.

Okay. And until that time, what kind of number do you look at on a yearly or quarterly basis or does it just bounce around?

It just going to, it will bounce around. I wish there was more certainty around this, but it’s irrelatively a complex exercise, especially all the moving parts here. And it’s going to probably range, stay closer to 40% would be kind of the number that we would expect, but it could be plus or minus that. Stephen MacLeod – BMO Capital Markets: So that’s a 40% tax rate - -

Yes, without getting the benefit of these tax loss carry forwards.

Okay. And then just one final question, the non-controlling interest share of earnings, how do you sort of see that moving around going forward?

Well, we kind of use the 20% to 22% in that range. I think that’s good for now unless there’s any dramatic change to the NCI component in our businesses. Jay, I think you addressed that earlier. We don’t expect there to be any, but you never know, but for now, the 20% to 22% is probably a good number. Stephen MacLeod – BMO Capital Markets: Alright, great. Thank you.

Welcome.

And we do have one more question from Damir Gunja and they are with TD Securities [ph]. Please go ahead. Damir Gunja – TD Securities: Thanks very much. Just on the FAS, assuming I guess in early 2011, you have a nice return to higher activity levels. Is there an opportunity there to perhaps expand margins or should we be expecting sort of a consistent experience as you had in recent quarters?

Our expectations that the margins that we’ve earned in the last three quarters are the margins that we expect loner-term Damir Gunja – TD Securities: Okay, thanks very much.

Thank you. There are no further questions at this time.

Okay, ladies and gentlemen thanks for joining us on this conference call and we look forward to having you, join us again on our fourth quarter. Thank you.