2010 was a year of solid overall results for FirstService, and reflected our diversification, in both our services and the markets in which we operate. We reported record operating results, with revenues of just under $2 billion, adjusted EBITDA of $147 million and adjusted earnings per share of $1.61. Measures taken to adjust our cost structure in 2008 and 2009 put us in a position of strength entering 2010, and we were able to take advantage of strong economic growth in the Asia-Pacific region and the more moderate recovery in North America. We also enjoyed improved results from our operations in most of Central and Eastern Europe, where the recovery has been very slow.

The biggest story was our Commercial Real Estate division, which rebounded sharply in 2010 from subpar results in 2009 when it was significantly impacted by the recession and lack of market liquidity. These conditions were far-reaching and affected not only our own operations, but also those of every other competitor in the commercial real estate business. Finishing strongly in 2009, due to our stringent cost management and the early stages of recovery in several global markets, we were well positioned to continue our positive momentum into 2010. We finished the year in this division with revenues of over $860 million: a 38% increase and the highest ever for our commercial real estate operations. Our adjusted EBITDA increased more than six fold to over $39 million.

Perhaps more importantly, we continued to build our business under the Colliers International brand, which we had gained control of in early 2010. This move, which was a very positive outcome of the downturn experienced in 2008 and 2009, solidified and unified Colliers International, providing greater clarity to the market about the future direction of the brand, and the financial and strategic commitment of FirstService. With this came the opportunity to build new and expanded relationships with our clients through comprehensive services, provided through our Corporate Solutions real estate outsourcing programs. It also enabled the recruitment of top-notch real estate professionals across our markets, particularly in our US and Asia-Pacific operations.

Meanwhile, our stalwart Residential Property Management division provided another solid year of operating results, with revenues up 3%, and adjusted EBITDA margins declining 50 basis points to 8.9%. While the issues negatively affecting the US residential housing market are well known, particularly those related to the value of residential real estate and mortgage finance, our business has remained resilient - largely due to the essential services we provide. Having said this, we have seen more intense price competition for both core property management services and the discretionary, ancillary services that we provide, particularly landscaping services in the Sunbelt states. And while operating conditions remained somewhat challenging, we forged ahead with further expansion into new markets - such as Houston, Vancouver and Calgary - with the acquisition of market leaders in these cities and our initial expansion into the Canadian market.

Finally, our Property Services operations again delivered solid results, though not at the same pace as in 2009. Revenues in 2010 were up 6%. Our market-leading Field Asset Services ("FAS") business continued to perform well during a year in which ongoing intervention by regulators, as well as the slowing of judicial processes required to complete foreclosures in several US states, contributed to a protracted recession in the US residential real estate market. FAS continued to find new ways of assisting its clients in maintaining, and in some cases enhancing, the value of their real estate assets. Meanwhile, we continued to experience modest recovery in our consumer-oriented franchises. These benefited from our stabilization efforts in 2009, when we worked closely with our management teams and franchisees to align their cost structures to the realities of reduced revenues. An increase in demand, combined with the above measures, resulted in improved operating results in 2010.

FirstService has acquired well over 100 companies since becoming a public company in 1993. These acquisitions have augmented our own internal growth initiatives and have provided our shareholders with excellent long-term returns. Our interests in M&A remain focused on building out our service lines through expansion into new regions or adding complementary services. Occasionally, FirstService completes larger acquisitions, particularly when entering an entirely new service platform, as was the case with our entry into commercial real estate in late 2004. But rarely do our acquisitions attract media attention. And while the latest surge of other players' M&A transactions may generate more headlines, FirstService prefers a lower profile, disciplined approach, including reasonable metrics around both price and deal structure. This is the best way to create value, one step at a time, and maximize our return to shareholders.

The challenges experienced in 2008 and 2009 have not been lost on us at FirstService or the executive management team that leads our Colliers International business. Together, we made difficult operational and strategic decisions that positioned us well for the current recovery. In fact, we are in a better market position today, particularly in our key markets, than we were at anytime during the last expansionary stage of the commercial real estate cycle through 2007. And with control of the Colliers International brand, we have the potential to double the size of our global commercial real estate business over the next five years.

Three major accomplishments come to mind. First, after achieving control over the Colliers International brand, we set out to rebrand and spent significantly in 2010 doing so. This rebranding consisted of two components: 1) refreshing the look of the familiar Colliers International logo, and 2) utilizing a singular "Colliers International" identification globally, as opposed to the co-branding with local real estate firms, which had historically been the approach taken as Colliers International expanded. While our commercial real estate operations will incur additional rebranding related expenses in 2011, this process has largely been completed.

Second, we successfully completed several high profile recruitments of individuals and teams across our various markets in 2010. These added key talent in areas where our service offerings could be enhanced. We expect to continue this campaign in 2011 and are confident that our enterprising culture, unified brand and global reach will attract the commercial real estate industry's most successful and collaborative professionals.

Finally, we completed several acquisitions during 2010, including the strengthening of our position in The Netherlands through the acquisition of BHH, and expanding our presence in the US Mid-west with high profile market anchoring positions in Chicago, Kansas City and St. Louis.

Our acquisition in late 2009 of a 29.6% stake in Colliers UK, a small public company listed on the AIM exchange, provided a meaningful presence in the UK, with smaller operations in Ireland and Spain. The goal of this move was expanding our operations further into Western Europe, and London in particular. However, we acknowledged at the time that market conditions were likely to remain challenging, and given the state of the Colliers UK business, significant repositioning would be required. The downside of this was a $0.12 charge to our adjusted EPS in 2010 representing our share of this operation's losses. However, on a positive note, Colliers UK hired a new CEO - Tony Horrell - a highly experienced leader in the London market, and also participated in the Colliers global rebranding. We have also started to drive business between London and other major international cities within the operations of Colliers International, something that was not occuring in the past. This represents a significant growth opportunity to service global clients and leverage greater collaboration between our various offices, particularly in our Europe, North America and Asia-Pacific regions.

Narrowing our field of view from "diversified" services to "real estate" services was a tough strategic decision, the seeds of which were sown in 2004 with the acquisition of Colliers Macaulay Nicolls, the largest operator within Colliers International. As much as we coveted our wide service line diversification, and the strong businesses we owned in business process outsourcing and integrated security services, it became clear that our shareholders would benefit from focusing our resources and capital on real estate services - one of the largest service sectors in the global economy. Through divestitures in 2006 and 2008, we delivered significant returns for our shareholders, redeployed capital and strengthened our balance sheet going into a period of economic uncertainty. Although all the benefits were not entirely obvious at the time, it was the right move. Today, our position is better than ever, with a strong balance sheet supporting the focused growth of our global real estate services business.

As we have stated before, we'd like to claim we had some unique foresight in making our decision to acquire FAS, but the reality is that our primary motivation was more about the company's strong management team and unique business model: it serviced clients on a national basis through an extensive network of contractors, all supported by a robust IT system and solid business processes. As addressed previously, there were significant external factors, primarily caused by government intervention to slow the rate of foreclosures, which negatively impacted the volume of foreclosures in 2010.

However, the shadow inventory consisting of existing homes in foreclosure and significantly delinquent mortgages remain at all time highs, estimated at up to eight million homes across the US. Based on historical experience, most of these homes will eventually come into possession of mortgage lenders and servicers, and will require preparation for resale. With FAS playing a pivotal role in assisting our lender and servicer clients, from time of possession to either resale or rental, we see significant future opportunity at FAS.

In 2010, it was apparent that consumers in the US remained focused on reducing debt, increasing their saving rates and channeling most of their spending into essentials. Meanwhile, with unemployment remaining elevated and consumer confidence generally tepid, the market for our consumer-focused service businesses remained challenging. But the good news is that we prepared for this with significant measures taken in 2009 to align our businesses to this new reality. Though we expect 2011 to remain challenging, our franchise businesses are extremely well positioned to excel as the recovery in the US economy, and in consumer spending particularly, builds momentum during the next few years. We provide services that range from the immediately essential, such as the services provided by our Paul Davis Restoration business, to those that are discretionary, as in the case of California Closets. In many cases, our services relate to property maintenance or improvements that cannot be indefinitely deferred.

Using hindsight to evaluate moves like this is often not the right frame of reference. During the latter half of 2008 and throughout 2009, turbulent markets and limited liquidity were significantly impacting the way many companies planned for their capital requirements. Though we were not compelled to raise capital at that time, we decided to take a more conservative view and remove any uncertainty regarding our future capital requirements with this financing. It featured a fixed interest rate for 5 years of 6.50% and a conversion premium of 40% at the time of issue. Though this financing reduced our adjusted EPS in 2010, it was not nearly as dilutive as the financings that many of our competitors were compelled to complete in 2009. The upshot is that we are now more than ever extremely well positioned to support our growth with significant cash flow generation from our operations and a strong balance sheet, including well over $200 million in combined cash on hand and through our revolving credit facility.

In Commercial Real Estate, we expect the recovery of 2010 to continue, as we remain at an early stage of the cycle of commercial real estate activity in most markets. We'll continue to balance the pursuit of growth opportunities with careful cost management, with a focus on improving margins as we gain greater share and benefit from operating leverage.

In Residential Property Management, we expect continued growth in our properties under management based on market share gains, as well as an uptick in the growth in on-site ancillary services. Some of these services were deferred in 2009 and 2010, but practically will be difficult to defer longer. Meanwhile we expect to continue to grow our financial services and products to our growing base of properties under management. Though price increases on core management contract services will likely remain as challenging as they were in 2010, we believe that we can improve margins, based on better productivity, higher ancillary service revenues and additional operating leverage achieved through continued growth.

In Property Services, we expect that FAS will be a major contributor to our revenue and profitability, with growth expected to outpace 2010. Meanwhile, we expect our franchise and branchise operations to benefit from a continuing recovery in US consumer spending, and for this to accelerate beyond 2011.