<PAGE>

                                                                     EXHIBIT 3.1
                                FOURTH RESTATED
                          CERTIFICATE OF INCORPORATION
                                       OF
                          CB COMMERCIAL HOLDINGS, INC.


  CB Commercial Holdings, Inc., a corporation organized and existing under the
   General Corporation Law of the State of Delaware (the "Corporation"), DOES
                                HEREBY CERTIFY:

 FIRST:  The original name under which the Corporation was incorporated in the
                   State of Delaware is CB Acquisition Corp.

SECOND:  The original Certificate of Incorporation of the Corporation was filed
     with the Secretary of State of Delaware on March 9, 1989; the Restated
 Certificate of Incorporation was filed with the Secretary of State of Delaware
 on March 15, 1989; the Second Restated Certificate of Incorporation was filed
    with the Secretary of State of Delaware on April 17, 1989; and the Third
 Restated Certificate of Incorporation was filed with the Secretary of State of
                        Delaware on September 18, 1989.

 THIRD:  The Fourth Restated Certificate of Incorporation of the Corporation in
 the form attached hereto as Exhibit A has been duly adopted in accordance with
  the provisions of Sections 245 and 242 of the General Corporation Law of the
    State of Delaware by the directors and stockholders of the Corporation.

 FOURTH:  The Fourth Restated Certificate of Incorporation so adopted reads in
full as set forth in Exhibit A attached hereto and is hereby incorporated herein
                               by this reference.

IN WITNESS WHEREOF, the Corporation has caused this Certificate to be signed by
 the Chief Executive Officer and the Secretary this 2nd day of December, 1996.


                                              CB COMMERCIAL HOLDINGS, INC.



                                                 By /s/  James J. Didion
                                                    ---------------------------
                                                         Chief Executive Officer


ATTEST:



BY /s/  Karen A. Tallman
   -----------------------
         Secretary
<PAGE>

                                                                       EXHIBIT A

                                FOURTH RESTATED
                         CERTIFICATE OF INCORPORATION
                                      OF
                         CB COMMERCIAL HOLDINGS, INC.


     FIRST:  The name of the corporation is:
     -----

                CB Commercial Real Estate Services Group, Inc.

     SECOND:  The registered office of the corporation in the State of
     ------
Delaware is located at 1209 Orange Street, City of Wilmington, County of New
Castle. The name of the registered agent of the corporation at such address is
The Corporation Trust Company.

     THIRD:  The purpose of the corporation is to engage in any lawful act or
     -----
activity for which a corporation may be organized under the General Corporation
Law of the State of Delaware as the same exists or may hereafter be amended.

     FOURTH:
     ------

     A.  The total number of shares of all classes of capital stock that the
corporation is authorized to issue is 108,000,000, of which 8,000,000 shall be
Preferred Stock ("Preferred Stock") and 100,000,000 shall be Common Stock
("Common Stock").  Both the Preferred Stock and Common Stock shall have a par
value of $.01 per share.

     B.  The Common Stock may be issued from time to time as follows:

     1.  Prior to Recapitalization Date .  Prior to the Recapitalization Date
         -------------------------------
(as defined below), the Common Stock shall consist of three (3) classes:  (a)
4,000,000 shares designated Class B-1 Common Stock ("B-1 Stock"), (b) 12,000,000
shares designated Class B-2 Common Stock ("B-2 Stock") and (c) 1,600,000 shares
designated as Class C-1 Common Stock ("C-1 Stock").  The "Recapitalization Date"
means the date, prior to March 31, 1997, of the closing of an IPO.  An "IPO"
means a sale of Common Stock for not less than $18.75 per share in an
underwritten public offering registered under the Securities Act of 1933, as
amended, completed on or prior to March 31, 1996, which results in aggregate
proceeds to the corporation (prior to underwriters' discounts and expenses
relating to the issuance) of  $75,000,000 or more and which results in the
approval for quotation of such Common Stock on the National Association of
Securities Dealers Automated Quotation System or the listing of such Common
Stock on the New York Stock Exchange.

Prior to the Recapitalization Date, all outstanding shares of Common Stock shall
be identical and shall entitle the holders thereof to the same rights and
privileges, except as provided below:

     a.  Voting Rights.  The holders of shares of B-1 Stock and B-2 Stock shall
         -------------
have the right to vote on all matters to be voted upon by the stockholders of
the corporation.  The holder of shares of B-1 Stock and B-2 Stock shall be
entitled to one (1) vote per share, voting on each matter upon which such
holders are entitled to vote.  The holders of shares of C-1 Stock shall have no
right to vote under any circumstances or for any purpose except as specifically
required by the Delaware General Corporation Law.

     b.  Dividend Rights.  Subject to the payment of any dividends which the
         ---------------
holders of Preferred Stock are entitled to receive in preference to the holders
of Common Stock and subject to the provisions of the Certificates of
Designation, Preferences and Rights related to the Series A-1, Series A-2 and
Series A-3 Preferred Stock (the "Original Preferred Stock"), the holders of
shares of B-1 Stock, B-2 Stock and C-1 Stock

                                      -2-
<PAGE>

shall be entitled to receive, as and when declared by the Board of Directors,
out of any assets legally available therefor, such dividends as may be declared
from time to time by the Board of Directors, allocated with respect to each
share of B-1 Stock, B-2 Stock and C-1 Stock on a share-for-share basis.

     c.  Liquidation.  Upon any liquidation, dissolution or winding up of the
         -----------
corporation, whether voluntary or involuntary, each holder of shares of Common
Stock shall be entitled to share (subject to the payment of any amounts which
holders of Preferred Stock are entitled to receive in preference to or pari
passu with the holders of Common Stock) in the remaining assets of the
corporation to be distributed among the holders of shares of the capital stock
of the corporation as follows:

             i. First, each holder of shares of B-1 Stock and B-2 Stock shall be
entitled to receive an amount, reduced by any prior payments to such holder
pursuant to this Section B.1.c. of Article Fourth, equal to $10 per share (as
adjusted for any stock dividends, combinations or splits).

             ii. Second, each holder of shares of C-1 Stock shall be entitled to
receive an amount, reduced by any prior payments to such holder pursuant to this
Section B.1.c. of Article Fourth, equal to the par value of each such share (as
adjusted for any stock dividends, combination or splits).

             iii. Third, each holder of shares of B-1 Stock, B-2 Stock and C-1
Stock shall be entitled to share the remaining assets of the corporation to be
distributed among holders of shares of the corporation's capital stock on a
share-for-share basis.


     2.  On or After Recapitalization Date.  From and after the Recapitalization
         ---------------------------------
Date, the Common Stock shall consist of a single class of 100,000,000 shares,
each of which shall be identical.  From and after the Recapitalization Date,
there shall be no cumulative voting.

     3.  Automatic Conversion of Common Stock on Recapitalization Date.
         --------------------------------------------------------------
Immediately upon the closing of an IPO on the Recapitalization Date, (a) each
share of B-1 Stock and B-2 Stock shall automatically be converted into one (1)
share of Common Stock and (b) each share of C-1 Stock shall automatically be
converted into shares of Common Stock at the C-1 Conversion Rate.  The C-1
Conversion Rate is (a) the Conversion Price minus $10.00 per share, divided by
(b) the Conversion Price.  The Conversion Price means the greater of the price
at which each share of Common Stock is offered by the Corporation to the public
in an IPO and $22.00.  Such conversion shall be deemed to have been made
immediately upon the closing of an IPO.

     C.  The Preferred Stock may be issued from time to time as follows:

     1.  Prior to Conversion of Original Preferred Stock.   Prior to the date
         ------------------------------------------------
all of the Original Preferred Stock shall have been converted into Common Stock
in accordance with the applicable Certificate of Designation, Preferences and
Rights, each holder of shares of the Original Preferred Stock shall be entitled
to the rights and privileges set forth in the applicable Certificates of
Designation, Preference and Rights.

     2.  Authority of Board of Directors to Establish Series of Preferred Stock.
         ----------------------------------------------------------------------
The Preferred Stock shall consist of a single class of 8,000,000 shares and may
be issued from time to time in one or more series.  The Board of Directors of
the corporation (the "Board of Directors") is expressly authorized to provide
for the issue of all or any of the Preferred Stock in one or more series, to fix
the designation and number of shares thereof and to determine or alter for each
such series, such voting powers, full or limited, or no voting powers, and such
designations, preferences and relative, participating, optional or other special
rights, and the qualifications, limitations or restrictions thereof, as shall be
stated and expressed in the resolution or resolutions adopted by the Board of
Directors providing for the issuance of such stock and as may be permitted by
the General Corporation Law of the State of Delaware.  The Board of Directors is
also expressly authorized to increase or decrease (but not below the number of
shares of such series then outstanding, plus the number of shares of such series
issuable upon exercise of outstanding rights, options or warrants or upon

                                      -3-
<PAGE>

conversion of outstanding securities issued by the corporation) the number of
shares of any series. If the number of shares of any such series shall be so
decreased, the shares constituting such decrease shall resume the status that
they had prior to the adoption of the resolution originally fixing the number of
shares of such series.

       FIFTH:  A director of the corporation shall not be liable to the
       -----
corporation or its stockholders for monetary damages for breach of fiduciary
duty as a director, except to the extent such exemption from liability or
limitation thereof is not permitted under the General Corporation Law of the
State of Delaware as the same exists or may hereafter be amended.  Any repeal or
modification of the foregoing sentence shall not adversely affect any right or
protection of a director of the corporation existing hereunder with respect to
any act or omission occurring prior to such repeal or modification.

       SIXTH:
       -----

       A.  The corporation shall indemnify and hold harmless, to the fullest
extent permitted by applicable law as it presently exists or may hereafter be
amended, any person who was or is made or is threatened to be made a party or is
otherwise involved in any action, suit or proceeding, whether civil, criminal,
administrative or investigative (a "Proceeding") by reason of the fact that he,
or a person for whom he is the legal representative, is or was a director or
officer of the corporation or is or was serving at the request of the
corporation as a director, officer, employee or agent of another corporation or
of a partnership, joint venture, trust, enterprise or nonprofit entity,
including service with respect to employee benefit plans (an "Indemnitee"),
against all liability and loss suffered and expenses (including attorneys' fees)
reasonably incurred by such person.  The corporation shall not be required to
indemnify and hold harmless a person in connection with a Proceeding (or part
thereof) initiated by such person unless the Proceeding (or the part thereof
initiated by such person) was authorized by the Board of Directors.

       B.  The right to indemnification conferred by this Article SIXTH shall be
presumed to have been relied upon by the Indemnitee and shall be enforceable as
a contract right.  The corporation may enter into contracts to provide
individual Indemnitees with specific rights of indemnification to the fullest
extent permitted by applicable law and may create trust funds, grant security
interests, obtain letters of credit or use other means to ensure the payment of
such amounts as may be necessary to effect the rights provided in this Article
SIXTH or in any such contract.

       C.  Except for any Proceeding described in the last sentence of Section A
of Article SIXTH, upon making a request for indemnification, the Indemnitee
shall be presumed to be entitled to indemnification under this Article SIXTH and
the corporation shall have the burden of proof to overcome that presumption in
reaching any contrary determination.  Such indemnification shall include the
right to receive payment in advance of any reasonable expenses incurred by the
Indemnitee in connection with any Proceeding (other than a Proceeding described
in the last sentence of Section A of Article Sixth) consistent with the
provisions of applicable law.

       D. Any repeal or modification of the foregoing provisions of this Article
SIXTH shall not adversely affect any right or protection of any Indemnitee
existing at the time of such repeal or modification.

       SEVENTH:  The Board of Directors is authorized to adopt, amend or repeal
       -------
the by-laws of the corporation, without any action on the part of the
stockholders, solely by the affirmative vote of at least a majority of the
directors of the corporation then in office.

                                      -4-
<PAGE>

                          CERTIFICATE OF DESIGNATION,
                           PREFERENCES AND RIGHTS OF
                                       OF
                           SERIES A-1 PREFERRED STOCK
                                       OF
                 CB COMMERCIAL REAL ESTATE SERVICES GROUP, INC.
                 ----------------------------------------------
                    (formerly CB Commercial Holdings, Inc.)


             Pursuant to Section 151 of the General Corporation Law
                            of the State of Delaware


     CB Commercial Real Estate Services Group, Inc., a corporation organized and
existing under the General Corporation Law of the State of Delaware (the
"Corporation"), does hereby certify that pursuant to the authority conferred
upon the Board of Directors by Article FOURTH of the Certificate of
Incorporation of the Corporation, and in accordance with Section 151 of the
General Corporation Law of the State of Delaware, the said Board of Directors
has adopted the following resolution creating a series of Preferred Stock,
designated as Series A-1 Preferred Stock:

     RESOLVED, that pursuant to the authority vested in the Board of Directors
of the Corporation in accordance with the provisions of the Corporation's
Certificate of Incorporation, effective upon the closing of an IPO, a series of
Preferred Stock of the Corporation be and it hereby is created, and that the
designation and amount thereof and the powers, preferences and relative,
participating, optional and other special rights of the shares of such series,
and the qualifications, limitations or restrictions thereof are as follows:

     1.   Designation and Amount.  The shares of such series shall be designated
          ----------------------
as "Series A-1 Preferred Stock," par value $.01 per share, and the number of
shares constituting such series shall be 1,000,000.  Such number of shares may
be decreased (but may not be increased) by resolution of the Board of Directors;
provided, that no decrease shall reduce the number of shares of Series A-1
Preferred Stock to a number less than that of the shares then outstanding plus
the number of shares issuable upon exercise of outstanding rights, options or
warrants or upon conversion of outstanding securities issued by the Corporation.

     2.   Automatic Conversion of Existing Series A-1 Preferred Stock on
          --------------------------------------------------------------
Recapitalization.  Immediately upon the closing of an IPO on the
----------------
Recapitalization Date, each existing share of Series A-1 Preferred Stock of the
Corporation shall be converted automatically into one (1) share of Series A-1
Preferred Stock with the powers, preferences and relative, participating,
optional and other special rights of such shares of such series and the
qualifications, limitations or restrictions as set forth herein.

    3.   Dividends.
         ---------

     (a)  Preference Dividend
          -------------------

      (i) (A)  The holders of the Series A-1 Preferred Stock shall be entitled
    to receive dividends at the rate of $.25 per quarter on each share of Series
    A-1 Preferred Stock, payable out of funds legally available therefor in cash
    within one year after the last day of the quarter to which it relates (the
    "Preference Dividend").  On the Recapitalization Date, the accrual of such
    dividend shall be retroactive to October 1, 1996.  Such dividends shall be
    payable only when, as and if declared by the Board of Directors.

                                      -1-
<PAGE>

          (B) In the event the Preference Dividend is not declared and paid
    within one year after the last day of the quarter to which it relates, it
    will bear compound interest at a fixed rate of 8% per annum; provided,
                                                                 --------
    however, that (i) if applicable law restricts or prohibits the declaration
    -------
    or payment of the Preference Dividend, no dividend shall be required to be
    declared and paid and no interest shall accrue thereon or be paid to the
    extent so restricted or prohibited, and (ii) in the event a contractual
    restriction in a credit agreement with a third party to which the
    Corporation or one of its direct or indirect subsidiaries is a party
    restricts or prohibits the declaration or payment of the Preference
    Dividend, no dividend shall be required to be declared or paid other than in
    accordance with such contractual restriction, but the Preference Dividend
    shall accumulate and accrue as set forth above, interest shall be paid on
    the unpaid dividend to the extent permitted under applicable law and any
    interest which remains unpaid shall accrue as set forth above.

      (ii) Following the Recapitalization Date, until all accrued and unpaid
    Preference Dividends (and all accrued and unpaid interest thereon) on the
    Series A-1 Preferred Stock (subject to applicable law and contractual
    restrictions as set forth in Paragraphs 3(a)(i)(A) and (B) above) shall have
    been paid or declared and set apart during any fiscal year:

          (A) no shares of Common Stock shall be redeemed by the Corporation,
    other than shares of capital stock of the Corporation which were outstanding
    prior to the Recapitalization Date and other than shares of capital stock
    issued or issuable to officers, directors or employees of, or consultants
    to, the Corporation pursuant to stock option, stock purchase or similar
    plans and

          (B) no dividends (including dividends payable in the Common Stock of
    the Corporation, dividends payable in warrants to purchase Common Stock and
    dividends payable in securities convertible or exchangeable into shares of
    Common Stock of the Corporation) shall be paid or declared and set apart on
    any series of Preferred Stock or Common Stock of the Corporation (and in the
    case of Common Stock, no dividends shall accrue on such Common Stock) during
    that fiscal year.

    Nothing set forth in this Certificate shall limit the Corporation's ability
    to effect a stock split or reverse stock split.

      (iii)  Preference Dividends paid on the Series A-1 Preferred Stock, Series
    A-2 Preferred Stock and Series A-3 Preferred Stock in an amount less than
    the total amount of such Preference Dividends at the time accrued and
    payable on such shares and interest, if any, due on such Preference
    Dividend, shall be allocated pro rata on a share-by-share basis among all
    such shares at the time outstanding.

      (iv)  Upon the conversion of any share of Series A-1 Preferred Stock into
    the Corporation's Common Stock pursuant to Section 6 below, the holder of
    such share of Series A-1 Preferred Stock shall be entitled to receive in
    cash an amount equal to all accrued and unpaid Preference Dividends with
    respect thereto and interest, if any, due thereon, subject to restrictions
    of applicable law and contractual restrictions as set forth in Paragraph
    3(a)(i)(B) above.

     (b) Dividends in Excess of Preference Dividend.  Whenever any dividend is
         ------------------------------------------
declared and paid with respect to Common Stock, the holders of the Series A-1
Preferred Stock shall be entitled to receive (in addition to any Preference
Dividend and interest thereon in accordance with Paragraphs 3(a)(i)(A) and (B)
above) out of any assets legally available therefore a dividend on each share of
Series A-1 Preferred Stock equal to sixty percent (60%) of the dividend declared
and paid on each share of Common Stock (as proportionately adjusted for any
stock dividends, combinations or splits with respect to such shares).

     (c)  Except as otherwise provided herein, no right shall accrue to holders
of shares of Series A-1 Preferred Stock by reason of the fact that dividends on
said shares are not declared in any prior year, nor shall any undeclared or
unpaid dividend bear or accrue any interest.

                                      -2-
<PAGE>

     4.  Liquidation.
         -----------

     (a)  Liquidation Preference.  In the event of any liquidation, dissolution
          ----------------------
or winding up of the Corporation, whether voluntary or involuntary, the holders
of the Series A-1 Preferred Stock shall be entitled to receive, prior and in
preference to any distribution of any of the assets or surplus funds of the
Corporation to the holders of the Common Stock by reason of their ownership
thereof, all accrued but unpaid dividends and interest (if any) thereon (subject
to applicable law and contractual restrictions as set forth in Paragraphs
3(a)(i)(A) and (B) above), then, to the extent any assets of the Corporation
remain available for distribution to the stockholders of the Corporation, the
holders of Preferred Stock and Common Stock shall be entitled to receive an
amount equal to $10.00 per share (as proportionately adjusted for any stock
dividends, combinations or splits with respect to such shares), reduced by any
prior payments to such holder (not including all accrued but unpaid dividends
and accrued interest thereon) in connection with any liquidation, dissolution or
winding up.  The Series A-1 Preferred Stock shall rank on a parity with the
Corporation's Series A-2 and A-3 Preferred Stock as to the receipt of the
respective preferential amounts for each such series upon the occurrence of such
event.

     (b)  Distributions in Excess of Liquidation Preference.  With respect to
          -------------------------------------------------
the distribution of any remaining assets of the Corporation in connection with a
liquidation, dissolution or winding up, the holders of the Series A-1 Preferred
Stock shall be entitled (after distributions required by paragraph (a) above) to
receive with respect to each share of Preferred Stock sixty percent (60%) of any
distribution made with respect to a share of Common Stock (as proportionately
adjusted for any stock dividends, combinations or splits with respect to such
shares).

     5.   Voting Rights.  The holders of Series A-1 Preferred Stock shall have
          -------------
the following voting rights:

     (a) Each share of Series A-1 Preferred Stock shall entitle the holder
thereof to two (2) votes on all matters submitted to a vote of the stockholders
of the Corporation.

     (b) Except as otherwise expressly provided herein or required by law, the
holders of Series A-1 Preferred Stock, the holders of the Series A-2 Preferred
Stock and the holders of Common Stock entitled to vote shall vote together as
one class on all matters submitted to a vote of stockholders of the Corporation.

     (c) Except as otherwise expressly provided herein, holders of Series A-1
Preferred Stock shall have no special voting rights and their consent shall not
be required (except to the extent they are entitled to vote with holders of
Common Stock as set forth herein) for taking any corporate action.

     6.   Conversion.  The Series A-1 Preferred Stock shall not be convertible
          ----------
at any time during which the Market Price for a share of Common Stock into which
each share of Preferred Stock is converted is less than $10.00 per share.
Except as otherwise set forth above, any holder of Series A-1 Preferred Stock
may elect from time to time to convert some or all of such holder's Preferred
Stock into shares of Common Stock as follows:


     Market Price
     of Common Stock     Conversion Ratio
     ---------------     ----------------

     $10.00 to $21.99    78.00% of a share of Common Stock for each share of
                        Preferred Stock

     $22.00-$22.99       76.00% of a share of Common Stock for each share of
                        Preferred Stock

                                      -3-
<PAGE>

     $23.00-$23.99       74.00% of a share of Common Stock for each share of
                        Preferred Stock

     $24.00-$24.99       72.00% of a share of Common Stock for each share of
                        Preferred Stock

     $25.00-$25.99       70.00% of a share of Common Stock for each share of
                        Preferred Stock

     $26.00-$26.99       68.00% of a share of Common Stock for each share of
                        Preferred Stock

     $27.00-$27.99       66.00% of a share of Common Stock for each share of
                        Preferred Stock

     $28.00-$28.99       64.00% of a share of Common Stock for each share of
                        Preferred Stock

     $29.00-$29.99       62.00% of a share of Common Stock for each share of
                        Preferred Stock

     $30.00 and above    60.00% of a share of Common Stock for each share of
                        Preferred Stock

     The Market Price and the Conversion Ratio shall be adjusted as hereinafter
provided.  Any such election shall be made by written notice to the
Corporation's Secretary and shall be effective on the first day on which the
Common Stock is traded after such election is received by the Corporation's
Secretary.  Market Price for the conversion shall be determined by using as the
last day of the period for determining Market Price the effective date of the
election.

     (a) Adjustments to Market Price and Conversion Ratio for Certain Dividends
         ----------------------------------------------------------------------
and for Combinations or Subdivisions of Common Stock.  In the event that this
----------------------------------------------------
Corporation at any time or from time to time (i) shall declare or pay, without
consideration, any dividend on each outstanding share of the Common Stock
payable in Common Stock, (ii) shall issue Common Stock pursuant to the exercise
of a Warrant Dividend which was exercised at less than Market Price existing at
the time of the issuance of such Warrant Dividend, (iii) shall effect a
subdivision of the outstanding shares of Common Stock into a greater number of
shares of Common Stock (by stock split, reclassification or otherwise than by
payment of a dividend in Common Stock or in any warrant or right to acquire
Common Stock) or (iv) in the event the outstanding shares of Common Stock shall
be combined or consolidated, by reclassification or otherwise, into a lesser
number of shares of Common Stock, then the Market Price and Conversion Ratio for
the Series A-1 Preferred Stock in effect immediately prior to such event shall,
concurrently with the effectiveness of such event, be proportionately decreased
or increased, as appropriate, so as to protect the conversion privileges of the
Preferred Stock.  In the event that this Corporation shall declare or pay,
without consideration, any dividend on the Common Stock payable in any warrant
or right to acquire Common Stock exercisable for no consideration, then the
Corporation shall be deemed to have made a dividend payable in Common Stock in
an amount of shares equal to the maximum number of shares issuable upon exercise
of such warrant or right to acquire Common Stock.  A "Warrant Dividend" means a
dividend declared or paid by the Corporation without consideration on each
outstanding share of Common Stock and payable in a warrant or right to acquire
Common Stock.  Notwithstanding the foregoing, no adjustment for any Warrant
Dividend shall be required until, and then only to the extent that, such Warrant
Dividend has been actually exercised at less than the Market Price of Common
Stock at the time of the issuance of such Warrant Dividend.

     (b) Adjustments for Reclassification and Reorganization.  If the Common
         ---------------------------------------------------
Stock issuable upon conversion of the Series A-1 Preferred Stock shall be
changed into the same or a different number of shares of

                                      -4-
<PAGE>

any other class or classes of stock, whether by capital reorganization,
reclassification or otherwise (other than a subdivision or combination of shares
provided for in Section 6 above), the Market Price and Conversion Ratio then in
effect shall, concurrently with the effectiveness of such reorganization or
reclassification, be proportionately adjusted so that the Series A-1 Preferred
Stock shall be convertible into, in lieu of the number of shares of Common Stock
which the holders would otherwise have been entitled to receive, a number of
shares of such other class or classes of stock equivalent to the number of
shares of Common Stock that would have been received by the holders in the event
of a conversion of the Series A-1 Preferred Stock immediately before that
change.

     (c) No Impairment.  The Corporation will not, by amendment of its
         -------------
Certificate of Incorporation or through any reorganization, transfer of assets,
consolidation, merger, dissolution, issue or sale of securities or any other
voluntary action, avoid or seek to avoid the observance or performance of any of
the terms to be observed or performed hereunder by the Corporation, but will at
all times in good faith assist in the carrying out of all the provisions of this
Section 6 and in the taking of all such action as may be necessary or
appropriate in order to protect the conversion provisions applicable to the
Series A-1 Preferred Stock against impairment; provided, however, that
notwithstanding any other provision hereof, the Corporation may at any time and
from time to time take any of the foregoing actions without any adjustment to
the Market Price or Conversion Ratio unless such adjustment is specifically and
expressly provided for herein.

     (d) Certificates as to Adjustments.  Upon the occurrence of each adjustment
         ------------------------------
or readjustment of any Market Price and Conversion Ratio pursuant to this
Section 6 (other than adjustments pursuant to Section 6a(ii) with respect to the
issuance of Common Stock pursuant to the exercise of a Warrant Dividend), the
Corporation at its expense shall promptly compute such adjustment or
readjustment in accordance with the terms hereof and prepare and furnish to each
holder of Series A-1 Preferred Stock a certificate executed by the Corporation's
President or Chief Financial Officer setting forth such adjustment or
readjustment and showing in detail the facts upon which such adjustment or
readjustment is based.  Upon the declaration and payment by the Corporation of a
Warrant Dividend, in lieu of the certificate described above, the Corporation at
its expense shall promptly prepare and furnish to each holder of Series A-1
Preferred Stock a certificate executed by the Corporation's President or Chief
Financial Officer stating that the Corporation has declared and paid a Warrant
Dividend and describing the terms thereof.  The Corporation shall, upon the
written request at any time of any holder of Series A-1 Preferred Stock, furnish
or cause to be furnished to such holder a like certificate setting forth (i)
such adjustments and readjustments, (ii) the Conversion Ratio for such series of
Preferred Stock at the time in effect, and (iii) the number of shares of Common
Stock which at the time would be received upon the conversion of the Series A-1
Preferred Stock.

     (e) Reservation of Stock Issuable Upon Conversion.  The Corporation shall
         ---------------------------------------------
at all times reserve and keep available out of its authorized but unissued
shares of Common Stock, solely for the purpose of effecting the conversion of
the shares of the Series A-1 Preferred Stock, such number of its shares of
Common Stock as shall from time to time be sufficient to effect the conversion
of all outstanding shares of the Series A-1 Preferred Stock; and if at any time
the number of authorized but unissued shares of Common Stock shall not be
sufficient to effect the conversion of all then outstanding shares of the Series
A-1 Preferred Stock, the Corporation will take such corporate action as may, in
the opinion of its counsel, be necessary to increase its authorized but unissued
shares of Common Stock to such number of shares as shall be sufficient for such
purpose, including, without limitation, engaging in best efforts to obtain the
requisite stockholder approval of any necessary amendment to its Certificate of
Incorporation.

     (f) Fractional Shares.  No fractional share shall be issued upon the
         -----------------
conversion of any share or shares of Series A-1 Preferred Stock.  All shares of
Common Stock (including fractions thereof) issuable upon conversion of more than
one share of Series A-1 Preferred Stock by a holder thereof shall be aggregated
for purposes of determining whether the conversion would result in the issuance
of any fractional share.  If, after the aforementioned aggregation, the
conversion would result in the issuance of a fraction of a share of Common
Stock, the Corporation shall, in lieu of issuing any fractional share, pay the
holder otherwise entitled to such fraction a sum in cash equal to the fair
market value of such fraction on the date of conversion (as determined in good
faith by the Board of Directors).

                                      -5-
<PAGE>

     7.  Reacquired Shares.  Any shares of Series A-1 Preferred Stock purchased
         -----------------
or otherwise acquired by the Corporation in any manner whatsoever shall be
retired and canceled promptly after the acquisition thereof.  All such shares
shall upon their cancellation become authorized but unissued shares of Preferred
Stock and may be reissued as part of a new series of Preferred Stock to be
created by resolution or resolutions of the Board of Directors, subject to the
conditions and restrictions on issuance set forth herein.

     8.   Restrictions and Limitations.  So long as any shares of Series A-1,
          ----------------------------
Series A-2 and Series A-3 Preferred Stock remain outstanding, the Corporation
shall not, (i) issue any other equity security (including any security
convertible into or exercisable for any equity security) senior to or on parity
with the Series A-1, Series A-2 or Series A-3 Preferred Stock as to dividend
rights or liquidation preferences or (ii) without the vote or written consent by
the holders of a majority of the then outstanding shares of Series A-1, Series
A-2 and Series A-3 Preferred Stock, voting together as a single class, amend its
Certificate of Incorporation if such amendment would change any of the rights,
preferences or privileges provided for herein for the benefit of any shares of
that series of Preferred Stock.

     9.   Definitions.
          -----------

     "IPO" means a sale of Common Stock for not less than $18.75 per share in an
underwritten offering registered under the Securities Act of 1933, as amended,
which is completed on or before March 31, 1997, which results in aggregate
proceeds to the Corporation (prior to underwriters' discounts and expenses
relating to the issuance) of $75,000,000 or more and which results in the
listing of such Common Stock on the New York Stock Exchange or the approval for
quotation of such Common Stock on the National Association of Securities Dealers
Automated Quotation System.

     "Market Price" means (i) during the first 20 consecutive days in which the
Common Stock is traded after the closing of an IPO, the price at which the
common stock was offered to the public in the IPO and (ii) thereafter, the
average closing price for a share of Common Stock as reported by the Wall Street
                                                                     ---- ------
Journal (West Coast Edition) for a period of 20 consecutive trading days
-------
immediately prior to the day as of which Market Price is being determined
(ignoring for purposes of consecutiveness days on which the market or stock
exchange on which such stock trades is not open).

     "Recapitalization Date" means the date, prior to March 31, 1997, of the
closing of an IPO.

     IN WITNESS WHEREOF, the Corporation has caused this Certificate of
Designation, Preferences and Rights of Series A-1 Preferred Stock to be duly
executed by its Chief Executive Officer and attested to by its Secretary this
2nd day of December, 1996.



                                       /s/  James J. Didion
                                       --------------------
                                       CHIEF EXECUTIVE OFFICER



                                       ATTEST:



                                       /s/  Karen A. Tallman
                                       ---------------------
                                       SECRETARY



                                      -6-
<PAGE>

                          CERTIFICATE OF DESIGNATION,
                           PREFERENCES AND RIGHTS OF
                                       OF
                           SERIES A-2 PREFERRED STOCK
                                       OF
                 CB COMMERCIAL REAL ESTATE SERVICES GROUP, INC.
                 ----------------------------------------------
                    (formerly CB Commercial Holdings, Inc.)

             Pursuant to Section 151 of the General Corporation Law
                            of the State of Delaware


     CB Commercial Real Estate Services Group, Inc., a corporation organized and
existing under the General Corporation Law of the State of Delaware (the
"Corporation"), does hereby certify that pursuant to the authority conferred
upon the Board of Directors by Article FOURTH of the Certificate of
Incorporation of the Corporation, and in accordance with Section 151 of the
General Corporation Law of the State of Delaware, the said Board of Directors
has adopted the following resolution creating a series of Preferred Stock,
designated as Series A-2 Preferred Stock:

     RESOLVED, that pursuant to the authority vested in the Board of Directors
of the Corporation in accordance with the provisions of the Corporation's
Certificate of Incorporation, effective upon the closing of an IPO, a series of
Preferred Stock of the Corporation be and it hereby is created, and that the
designation and amount thereof and the powers, preferences and relative,
participating, optional and other special rights of the shares of such series,
and the qualifications, limitations or restrictions thereof are as follows:

     1.   Designation and Amount.  The shares of such series shall be designated
          ----------------------
as "Series A-2 Preferred Stock," par value $.01 per share, and the number of
shares constituting such series shall be 2,000,000.  Such number of shares may
be decreased (but may not be increased) by resolution of the Board of Directors;
provided, that no decrease shall reduce the number of shares of Series A-2
Preferred Stock to a number less than that of the shares then outstanding plus
the number of shares issuable upon exercise of outstanding rights, options or
warrants or upon conversion of outstanding securities issued by the Corporation.

     2.   Automatic Conversion of Existing Series A-2 Preferred Stock on
          --------------------------------------------------------------
Recapitalization.  Immediately upon the closing of an IPO on the
----------------
Recapitalization Date, each existing share of Series A-2 Preferred Stock of the
Corporation shall be converted automatically into one (1) share of Series A-2
Preferred Stock with the powers, preferences and relative, participating,
optional and other special rights of such shares of such series and the
qualifications, limitations or restrictions as set forth herein.

     3.   Dividends.
          ---------

     (a)  Preference Dividend
          -------------------

          (i)  (A)  The holders of the Series A-2 Preferred Stock shall be
     entitled to receive dividends at the rate of $.25 per quarter on each share
     of Series A-2 Preferred Stock, payable out of funds legally available
     therefor in cash within one year after the last day of the quarter to which
     it relates (the "Preference Dividend").  On the Recapitalization Date, the
     accrual of such dividend shall be retroactive to October 1, 1996.  Such
     dividends shall be payable only when, as and if declared by the Board of
     Directors.

                                      -1-
<PAGE>

               (B) In the event the Preference Dividend is not declared and paid
     within one year after the last day of the quarter to which it relates, it
     will bear compound interest at either (i) a fixed rate of 8% per annum or
     (ii) the LIBOR Rate plus 2-1/2% per annum until paid, as irrevocably
     designated by each holder of Preferred Stock pursuant to the Preferred
     Stockholder Agreement; provided, however, that (i) if applicable law
                            --------  -------
     restricts or prohibits the declaration or payment of the Preference
     Dividend, no dividend shall be required to be declared and paid and no
     interest shall accrue thereon or be paid to the extent so restricted or
     prohibited, and (ii) in the event a contractual restriction in a credit
     agreement with a third party to which the Corporation or one of its direct
     or indirect subsidiaries is a party restricts or prohibits the declaration
     or payment of the Preference Dividend, no dividend shall be required to be
     declared or paid other than in accordance with such contractual
     restriction, but the Preference Dividend shall accumulate and accrue as set
     forth above, interest shall be paid on the unpaid dividend to the extent
     permitted under applicable law and any interest which remains unpaid shall
     accrue as set forth above.

          (ii) Following the Recapitalization Date, until all accrued and unpaid
     Preference Dividends (and all accrued and unpaid interest thereon) on the
     Series A-2 Preferred Stock (subject to applicable law and contractual
     restrictions as set forth in Paragraphs 3(a)(i)(A) and (B) above) shall
     have been paid or declared and set apart during any fiscal year:

               (A) no shares of Common Stock shall be redeemed by the
     Corporation, other than shares of capital stock of the Corporation which
     were outstanding prior to the Recapitalization Date and other than shares
     of capital stock issued or issuable to officers, directors or employees of,
     or consultants to, the Corporation pursuant to stock option, stock purchase
     or similar plans and

               (B) no dividends (including dividends payable in the Common Stock
     of the Corporation, dividends payable in warrants to purchase Common Stock
     and dividends payable in securities convertible or exchangeable into shares
     of Common Stock of the Corporation) shall be paid or declared and set apart
     on any series of Preferred Stock or Common Stock of the Corporation (and in
     the case of Common Stock, no dividends shall accrue on such Common Stock)
     during that fiscal year.

     Nothing set forth in this Certificate shall limit the Corporation's ability
     to effect a stock split or reverse stock split.

          (iii)  Preference Dividends paid on the Series A-1 Preferred Stock,
     Series A-2 Preferred Stock and Series A-3 Preferred Stock in an amount less
     than the total amount of such Preference Dividends at the time accrued and
     payable on such shares and interest, if any, due on such Preference
     Dividend, shall be allocated pro rata on a share-by-share basis among all
     such shares at the time outstanding.

          (iv)  Upon the conversion of any share of Series A-2 Preferred Stock
     into the Corporation's Common Stock pursuant to Section 6 below, the holder
     of such share of Series A-2 Preferred Stock shall be entitled to receive in
     cash an amount equal to all accrued and unpaid Preference Dividends with
     respect thereto and interest, if any, due thereon, subject to restrictions
     of applicable law and contractual restrictions as set forth in Paragraph
     3(a)(i)(B) above.

     (b) Dividends in Excess of Preference Dividend.  Whenever any dividend is
         ------------------------------------------
declared and paid with respect to Common Stock, the holders of the Series A-2
Preferred Stock shall be entitled to receive (in addition to any Preference
Dividend and interest thereon in accordance with Paragraphs 3(a)(i)(A) and (B)
above) out of any assets legally available therefore a dividend on each share of
Series A-2 Preferred Stock equal to sixty percent (60%) of the dividend declared
and paid on each share of Common Stock (as proportionately adjusted for any
stock dividends, combinations or splits with respect to such shares).

     (c)  Except as otherwise provided herein, no right shall accrue to holders
of shares of Series A-2 Preferred Stock by reason of the fact that dividends on
said shares are not declared in any prior year, nor shall any undeclared or
unpaid dividend bear or accrue any interest.

                                      -2-
<PAGE>

     4.  Liquidation.
         -----------

     (a)  Liquidation Preference.  In the event of any liquidation, dissolution
          ----------------------
or winding up of the Corporation, whether voluntary or involuntary, the holders
of the Series A-2 Preferred Stock shall be entitled to receive, prior and in
preference to any distribution of any of the assets or surplus funds of the
Corporation to the holders of the Common Stock by reason of their ownership
thereof, all accrued but unpaid dividends and interest (if any) thereon (subject
to applicable law and contractual restrictions as set forth in Paragraphs
3(a)(i)(A) and (B) above), then, to the extent any assets of the Corporation
remain available for distribution to the stockholders of the Corporation, the
holders of Preferred Stock and Common Stock shall be entitled to receive an
amount equal to $10.00 per share (as proportionately adjusted for any stock
dividends, combinations or splits with respect to such shares), reduced by any
prior payments to such holder (not including all accrued but unpaid dividends
and accrued interest thereon) in connection with any liquidation, dissolution or
winding up.  The Series A-2 Preferred Stock shall rank on a parity with the
Corporation's Series A-1 and A-3 Preferred Stock as to the receipt of the
respective preferential amounts for each such series upon the occurrence of such
event.

     (b)  Distributions in Excess of Liquidation Preference.  With respect to
          -------------------------------------------------
the distribution of any remaining assets of the Corporation in connection with a
liquidation, dissolution or winding up, the holders of the Series A-2 Preferred
Stock shall be entitled (after distributions required by paragraph (a) above) to
receive with respect to each share of Preferred Stock sixty percent (60%) of any
distribution made with respect to a share of Common Stock (as proportionately
adjusted for any stock dividends, combinations or splits with respect to such
shares).

     5.   Voting Rights.  The holders of Series A-2 Preferred Stock shall have
          -------------
the following voting rights:

     (a) Each share of Series A-2 Preferred Stock shall entitle the holder
thereof to one (1) vote on all matters submitted to a vote of the stockholders
of the Corporation.

     (b) Except as otherwise expressly provided herein or required by law, the
holders of Series A-1 Preferred Stock, the holders of the Series A-2 Preferred
Stock and the holders of Common Stock entitled to vote shall vote together as
one class on all matters submitted to a vote of stockholders of the Corporation.

     (c) Except as otherwise expressly provided herein, holders of Series A-2
Preferred Stock shall have no special voting rights and their consent shall not
be required (except to the extent they are entitled to vote with holders of
Common Stock as set forth herein) for taking any corporate action.

     6.   Conversion.  The Series A-2 Preferred Stock shall not be convertible
          ----------
at any time during which the Market Price for a share of Common Stock into which
each share of Preferred Stock is converted is less than $10.00 per share.
Except as otherwise set forth above, any holder of Series A-2 Preferred Stock
may elect from time to time to convert some or all of such holder's Preferred
Stock into shares of Common Stock as follows:

<TABLE>
<CAPTION>

     Market Price
     of Common Stock     Conversion Ratio
     ---------------     ----------------
     <S>                 <C>
     $10.00 to $21.99    78.00% of a share of Common Stock for each share of
                         Preferred Stock

     $22.00-$22.99       76.00% of a share of Common Stock for each share of
                         Preferred Stock
</TABLE>

                                      -3-
<PAGE>

<TABLE>
     <S>                 <C>
     $23.00-$23.99       74.00% of a share of Common Stock for each share of
                         Preferred Stock

     $24.00-$24.99       72.00% of a share of Common Stock for each share of
                         Preferred Stock

     $25.00-$25.99       70.00% of a share of Common Stock for each share of
                         Preferred Stock

     $26.00-$26.99       68.00% of a share of Common Stock for each share of
                         Preferred Stock

     $27.00-$27.99       66.00% of a share of Common Stock for each share of
                         Preferred Stock

     $28.00-$28.99       64.00% of a share of Common Stock for each share of
                         Preferred Stock

     $29.00-$29.99       62.00% of a share of Common Stock for each share of
                         Preferred Stock

     $30.00 and above    60.00% of a share of Common Stock for each share of
                         Preferred Stock
</TABLE>

     The Market Price and Conversion Ratio shall be adjusted as hereinafter
provided.  Any such election shall be made by written notice to the
Corporation's Secretary and shall be effective on the first day on which the
Common Stock is traded after such election is received by the Corporation's
Secretary.  Market Price for the conversion shall be determined by using as the
last day of the period for determining Market Price the effective date of the
election.

     (a) Adjustments to Market Price and Conversion Ratio for Certain Dividends
         ----------------------------------------------------------------------
and for Combinations or Subdivisions of Common Stock.  In the event that this
----------------------------------------------------
Corporation at any time or from time to time (i) shall declare or pay, without
consideration, any dividend on each outstanding share of the Common Stock
payable in Common Stock, (ii) shall issue Common Stock pursuant to the exercise
of a Warrant Dividend which was exercised at less than Market Price existing at
the time of the issuance of such Warrant Dividend, (iii) shall effect a
subdivision of the outstanding shares of Common Stock into a greater number of
shares of Common Stock (by stock split, reclassification or otherwise than by
payment of a dividend in Common Stock or in any warrant or right to acquire
Common Stock) or (iv) in the event the outstanding shares of Common Stock shall
be combined or consolidated, by reclassification or otherwise, into a lesser
number of shares of Common Stock, then the Market Price and Conversion Ratio for
the Series A-2 Preferred Stock in effect immediately prior to such event shall,
concurrently with the effectiveness of such event, be proportionately decreased
or increased, as appropriate, so as to protect the conversion privileges of the
Preferred Stock.  In the event that this Corporation shall declare or pay,
without consideration, any dividend on the Common Stock payable in any warrant
or right to acquire Common Stock exercisable for no consideration, then the
Corporation shall be deemed to have made a dividend payable in Common Stock in
an amount of shares equal to the maximum number of shares issuable upon exercise
of such warrant or right to acquire Common Stock. A "Warrant Dividend" means a
dividend declared or paid by the Corporation without consideration on each
outstanding share of Common Stock and payable in a warrant or right to acquire
Common Stock. Notwithstanding the foregoing, no adjustment for any Warrant
Dividend shall be required until, and then only to the extent that, such Warrant
Dividend has been actually exercised at less than the Market Price of Common
Stock at the time of the issuance of such Warrant Dividend.

     (b) Adjustments for Reclassification and Reorganization.  If the Common
         ---------------------------------------------------
Stock issuable upon conversion of the Series A-2 Preferred Stock shall be
changed into the same or a different number of shares of

                                      -4-
<PAGE>

any other class or classes of stock, whether by capital reorganization,
reclassification or otherwise (other than a subdivision or combination of shares
provided for in Section 6 above), the Market Price and Conversion Ratio then in
effect shall, concurrently with the effectiveness of such reorganization or
reclassification, be proportionately adjusted so that the Series A-2 Preferred
Stock shall be convertible into, in lieu of the number of shares of Common Stock
which the holders would otherwise have been entitled to receive, a number of
shares of such other class or classes of stock equivalent to the number of
shares of Common Stock that would have been received by the holders in the event
of a conversion of the Series A-2 Preferred Stock immediately before that
change.

     (c) No Impairment.  The Corporation will not, by amendment of its
         -------------
Certificate of Incorporation or through any reorganization, transfer of assets,
consolidation, merger, dissolution, issue or sale of securities or any other
voluntary action, avoid or seek to avoid the observance or performance of any of
the terms to be observed or performed hereunder by the Corporation, but will at
all times in good faith assist in the carrying out of all the provisions of this
Section 6 and in the taking of all such action as may be necessary or
appropriate in order to protect the conversion provisions applicable to the
Series A-2 Preferred Stock against impairment; provided, however, that
notwithstanding any other provision hereof, the Corporation may at any time and
from time to time take any of the foregoing actions without any adjustment to
the Market Price or Conversion Ratio unless such adjustment is specifically and
expressly provided for herein.

     (d) Certificates as to Adjustments.  Upon the occurrence of each adjustment
         ------------------------------
or readjustment of any Market Price and Conversion Ratio pursuant to this
Section 6 (other than adjustments pursuant to Section 6a(ii) with respect to the
issuance of Common Stock pursuant to the exercise of a Warrant Dividend), the
Corporation at its expense shall promptly compute such adjustment or
readjustment in accordance with the terms hereof and prepare and furnish to each
holder of Series A-2 Preferred Stock a certificate executed by the Corporation's
President or Chief Financial Officer setting forth such adjustment or
readjustment and showing in detail the facts upon which such adjustment or
readjustment is based.  Upon the declaration and payment by the Corporation of a
Warrant Dividend, in lieu of the certificate described above, the Corporation at
its expense shall promptly prepare and furnish to each holder of Series A-2
Preferred Stock a certificate executed by the Corporation's President or Chief
Financial Officer stating that the Corporation has declared and paid a Warrant
Dividend and describing the terms thereof.  The Corporation shall, upon the
written request at any time of any holder of Series A-2 Preferred Stock, furnish
or cause to be furnished to such holder a like certificate setting forth (i)
such adjustments and readjustments, (ii) the Conversion Ratio for such series of
Preferred Stock at the time in effect, and (iii) the number of shares of Common
Stock which at the time would be received upon the conversion of the Series A-2
Preferred Stock.

     (e) Reservation of Stock Issuable Upon Conversion.  The Corporation shall
         ---------------------------------------------
at all times reserve and keep available out of its authorized but unissued
shares of Common Stock, solely for the purpose of effecting the conversion of
the shares of the Series A-2 Preferred Stock, such number of its shares of
Common Stock as shall from time to time be sufficient to effect the conversion
of all outstanding shares of the Series A-2 Preferred Stock; and if at any time
the number of authorized but unissued shares of Common Stock shall not be
sufficient to effect the conversion of all then outstanding shares of the Series
A-2 Preferred Stock, the Corporation will take such corporate action as may, in
the opinion of its counsel, be necessary to increase its authorized but unissued
shares of Common Stock to such number of shares as shall be sufficient for such
purpose, including, without limitation, engaging in best efforts to obtain the
requisite stockholder approval of any necessary amendment to its Certificate of
Incorporation.

     (f) Fractional Shares.  No fractional share shall be issued upon the
         -----------------
conversion of any share or shares of Series A-2 Preferred Stock.  All shares of
Common Stock (including fractions thereof) issuable upon conversion of more than
one share of Series A-2 Preferred Stock by a holder thereof shall be aggregated
for purposes of determining whether the conversion would result in the issuance
of any fractional share.  If, after the aforementioned aggregation, the
conversion would result in the issuance of a fraction of a share of Common
Stock, the Corporation shall, in lieu of issuing any fractional share, pay the
holder otherwise entitled to such fraction a sum in cash equal to the fair
market value of such fraction on the date of conversion (as determined in good
faith by the Board of Directors).

                                      -5-
<PAGE>

     7.  Reacquired Shares.  Any shares of Series A-2 Preferred Stock purchased
         -----------------
or otherwise acquired by the Corporation in any manner whatsoever shall be
retired and canceled promptly after the acquisition thereof.  All such shares
shall upon their cancellation become authorized but unissued shares of Preferred
Stock and may be reissued as part of a new series of Preferred Stock to be
created by resolution or resolutions of the Board of Directors, subject to the
conditions and restrictions on issuance set forth herein.

     8.  Restrictions and Limitations.  So long as any shares of Series A-1,
         ----------------------------
Series A-2 and Series A-3 Preferred Stock remain outstanding, the Corporation
shall not, (i) issue any other equity security (including any security
convertible into or exercisable for any equity security) senior to or on parity
with the Series A-1, Series A-2 or Series A-3 Preferred Stock as to dividend
rights or liquidation preferences or (ii) without the vote or written consent by
the holders of a majority of the then outstanding shares of Series A-1, Series
A-2 and Series A-3 Preferred Stock, voting together as a single class, amend its
Certificate of Incorporation if such amendment would change any of the rights,
preferences or privileges provided for herein for the benefit of any shares of
that series of Preferred Stock.

     9.  Definitions.
         -----------

     "IPO" means a sale of Common Stock for not less than $18.75 per share in an
underwritten offering registered under the Securities Act of 1933, as amended,
which is completed on or before March 31, 1997, which results in aggregate
proceeds to the Corporation (prior to underwriters' discounts and expenses
relating to the issuance) of $75,000,000 or more and which results in the
listing of such Common Stock on the New York Stock Exchange or the approval for
quotation of such Common Stock on the National Association of Securities Dealers
Automated Quotation System.

     "LIBOR Business Day" means a day other than a Saturday, Sunday or other day
on which commercial banks in New York, New York or Los Angeles, California are
authorized or required to close and any day on which banks are not open for
dealings in dollar deposits in the London interbank market.

     "LIBOR Rate" means the rate per annum (rounded upwards, if any, to the next
higher 1/16th of 1%) on the basis of the offered rate of deposits in U.S.
dollars to The Sumitomo Bank, Limited in the London interbank market in amounts
comparable to the aggregate amount of any dividend which was required to have
been declared and paid and for a period of six months as of approximately 11:00
a.m. (London time) on the day any dividend was required to have been declared
and paid or, if such day is not a LIBOR Business Day, the next succeeding LIBOR
Business Day.

     "Market Price" means (i) during the first 20 consecutive days in which the
Common Stock is traded after the closing of an IPO, the price at which the
common stock was offered to the public in the IPO and (ii) thereafter, the
average closing price for a share of Common Stock as reported by the Wall Street
                                                                     ---- ------
Journal (West Coast Edition) for a period of 20 consecutive trading days
-------
immediately prior to the day as of which Market Price is being determined
(ignoring for purposes of consecutiveness days on which the market or stock
exchange on which such stock trades is not open).

     "Recapitalization Date" means the date, prior to March 31, 1997, of the
closing of an IPO.

                                      -6-
<PAGE>

     IN WITNESS WHEREOF, the Corporation has caused this Certificate of
Designation, Preferences and Rights of Series A-2 Preferred Stock to be duly
executed by its Chief Executive Officer and attested to by its Secretary this
2nd day of December, 1996.


                                         /s/ James J. Didion
                                         -------------------------------------
                                                 Chief Executive Officer


                                         Attest:

                                         /s/ Karen A. Tallman
                                         -------------------------------------
                                                 Secretary


                                      -7-
<PAGE>

                          CERTIFICATE OF DESIGNATION,
                           PREFERENCES AND RIGHTS OF
                                       OF
                           SERIES A-3 PREFERRED STOCK
                                       OF
                 CB COMMERCIAL REAL ESTATE SERVICES GROUP, INC.
                 ----------------------------------------------
                    (formerly CB Commercial Holdings, Inc.)


             Pursuant to Section 151 of the General Corporation Law
                            of the State of Delaware


     CB Commercial Real Estate Services Group, Inc., a corporation organized and
existing under the General Corporation Law of the State of Delaware (the
"Corporation"), does hereby certify that pursuant to the authority conferred
upon the Board of Directors by Article FOURTH of the Certificate of
Incorporation of the Corporation, and in accordance with Section 151 of the
General Corporation Law of the State of Delaware, the said Board of Directors
has adopted the following resolution creating a series of Preferred Stock,
designated as Series A-3 Preferred Stock:

     RESOLVED, that pursuant to the authority vested in the Board of Directors
of the Corporation in accordance with the provisions of the Corporation's
Certificate of Incorporation, effective upon the closing of an IPO, a series of
Preferred Stock of the Corporation be and it hereby is created, and that the
designation and amount thereof and the powers, preferences and relative,
participating, optional and other special rights of the shares of such series,
and the qualifications, limitations or restrictions thereof are as follows:

     1.   Designation and Amount.  The shares of such series shall be designated
          ----------------------
as "Series A-3 Preferred Stock," par value $.01 per share, and the number of
shares constituting such series shall be 1,000,000.  Such number of shares may
be decreased (but may not be increased) by resolution of the Board of Directors;
provided, that no decrease shall reduce the number of shares of Series A-3
Preferred Stock to a number less than that of the shares then outstanding plus
the number of shares issuable upon exercise of outstanding rights, options or
warrants or upon conversion of outstanding securities issued by the Corporation.

     2.   Automatic Conversion of Existing Series A-3 Preferred Stock on
          --------------------------------------------------------------
Recapitalization.  Immediately upon the closing of an IPO on the
----------------
Recapitalization Date, each existing share of Series A-3 Preferred Stock of the
Corporation shall be converted automatically into one (1) share of Series A-3
Preferred Stock with the powers, preferences and relative, participating,
optional and other special rights of such shares of such series and the
qualifications, limitations or restrictions as set forth herein.

     3.   Dividends.
          ---------

     (a)  Preference Dividend
          -------------------

          (i)  (A)  The holders of the Series A-3 Preferred Stock shall be
     entitled to receive dividends at the rate of $.25 per quarter on each share
     of Series A-3 Preferred Stock, payable out of funds legally available
     therefor in cash within one year after the last day of the quarter to which
     it relates (the "Preference Dividend"). On the Recapitalization Date, the
     accrual of such dividend shall be retroactive to October 1, 1996.  Such
     dividends shall be payable only when, as and if declared by the Board of
     Directors.
<PAGE>

               (B) In the event the Preference Dividend is not declared and paid
     within one year after the last day of the quarter to which it relates, it
     will bear compound interest at a fixed rate of 8% per annum; provided,
                                                                  --------
     however, that (i) if applicable law restricts or prohibits the declaration
     -------
     or payment of the Preference Dividend, no dividend shall be required to be
     declared and paid and no interest shall accrue thereon or be paid to the
     extent so restricted or prohibited, and (ii) in the event a contractual
     restriction in a credit agreement with a third party to which the
     Corporation or one of its direct or indirect subsidiaries is a party
     restricts or prohibits the declaration or payment of the Preference
     Dividend, no dividend shall be required to be declared or paid other than
     in accordance with such contractual restriction, but the Preference
     Dividend shall accumulate and accrue as set forth above, interest shall be
     paid on the unpaid dividend to the extent permitted under applicable law
     and any interest which remains unpaid shall accrue as set forth above.

          (ii) Following the Recapitalization Date, until all accrued and unpaid
     Preference Dividends (and all accrued and unpaid interest thereon) on the
     Series A-3 Preferred Stock (subject to applicable law and contractual
     restrictions as set forth in Paragraphs 3(a)(i)(A) and (B) above) shall
     have been paid or declared and set apart during any fiscal year:

               (A) no shares of Common Stock shall be redeemed by the
     Corporation, other than shares of capital stock of the Corporation which
     were outstanding prior to the Recapitalization Date and other than shares
     of capital stock issued or issuable to officers, directors or employees of,
     or consultants to, the Corporation pursuant to stock option, stock purchase
     or similar plans and

               (B) no dividends (including dividends payable in the Common Stock
     of the Corporation, dividends payable in warrants to purchase Common Stock
     and dividends payable in securities convertible or exchangeable into shares
     of Common Stock of the Corporation) shall be paid or declared and set apart
     on any series of Preferred Stock or Common Stock of the Corporation (and in
     the case of Common Stock, no dividends shall accrue on such Common Stock)
     during that fiscal year.

     Nothing set forth in this Certificate shall limit the Corporation's ability
     to effect a stock split or reverse stock split.

          (iii)  Preference Dividends paid on the Series A-1 Preferred Stock,
     Series A-2 Preferred Stock and Series A-3 Preferred Stock in an amount less
     than the total amount of such Preference Dividends at the time accrued and
     payable on such shares and interest, if any, due on such Preference
     Dividend, shall be allocated pro rata on a share-by-share basis among all
     such shares at the time outstanding.

          (iv)  Upon the conversion of any share of Series A-3 Preferred Stock
     into the Corporation's Common Stock pursuant to Section 6 below, the holder
     of such share of Series A-3 Preferred Stock shall be entitled to receive in
     cash an amount equal to all accrued and unpaid Preference Dividends with
     respect thereto and interest, if any, due thereon, subject to restrictions
     of applicable law and contractual restrictions as set forth in Paragraph
     3(a)(i)(B) above.

     (b) Dividends in Excess of Preference Dividend.  Whenever any dividend is
         ------------------------------------------
declared and paid with respect to Common Stock, the holders of the Series A-3
Preferred Stock shall be entitled to receive (in addition to any Preference
Dividend and interest thereon in accordance with Paragraphs 3(a)(i)(A) and (B)
above)) out of any assets legally available therefore a dividend on each share
of Series A-3 Preferred Stock equal to sixty percent (60%) of the dividend
declared and paid on each share of Common Stock (as proportionately adjusted for
any stock dividends, combinations or splits with respect to such shares).

     (c)  Except as otherwise provided herein, no right shall accrue to holders
of shares of Series A-3 Preferred Stock by reason of the fact that dividends on
said shares are not declared in any prior year, nor shall any undeclared or
unpaid dividend bear or accrue any interest.

                                      -2-
<PAGE>

     4.  Liquidation.
         -----------

     (a)  Liquidation Preference.  In the event of any liquidation, dissolution
          ----------------------
or winding up of the Corporation, whether voluntary or involuntary, the holders
of the Series A-3 Preferred Stock shall be entitled to receive, prior and in
preference to any distribution of any of the assets or surplus funds of the
Corporation to the holders of the Common Stock by reason of their ownership
thereof, all accrued but unpaid dividends and interest (if any) thereon (subject
to applicable law and contractual restrictions as set forth in Paragraphs
3(a)(i)(A) and (B) above), then, to the extent any assets of the Corporation
remain available for distribution to the stockholders of the Corporation, the
holders of Preferred Stock and Common Stock shall be entitled to receive an
amount equal to $10.00 per share (as proportionately adjusted for any stock
dividends, combinations or splits with respect to such shares), reduced by any
prior payments to such holder (not including all accrued but unpaid dividends
and accrued interest thereon) in connection with any liquidation, dissolution or
winding up.  The Series A-3 Preferred Stock shall rank on a parity with the
Corporation's Series A-1 and A-2 Preferred Stock as to the receipt of the
respective preferential amounts for each such series upon the occurrence of such
event.

     (b)  Distributions in Excess of Liquidation Preference.  With respect to
          -------------------------------------------------
the distribution of any remaining assets of the Corporation in connection with a
liquidation, dissolution or winding up, the holders of the Series A-3 Preferred
Stock shall be entitled (after distributions required by paragraph (a) above) to
receive with respect to each share of Preferred Stock sixty percent (60%) of any
distribution made with respect to a share of Common Stock (as proportionately
adjusted for any stock dividends, combinations or splits with respect to such
shares).

     5.   Voting Rights.  The holders of Series A-3 Preferred Stock shall have
          -------------
no right to vote under any circumstances or for any purpose except as
specifically required by the Delaware General Corporations Law.

     6.   Conversion.  The Series A-3 Preferred Stock shall not be convertible
          ----------
at any time during which the Market Price for a share of Common Stock into which
each share of Preferred Stock is converted is less than $10.00 per share.
Except as otherwise set forth above, any holder of Series A-3 Preferred Stock
may elect from time to time to convert some or all of such holder's Preferred
Stock into shares of Common Stock as follows:

<TABLE>
<CAPTION>

     Market Price
     of Common Stock     Conversion Ratio
     ---------------     ----------------
     <S>                 <C>
     $10.00 to $21.99    78.00% of a share of Common Stock for each share of
                         Preferred Stock

     $22.00-$22.99       76.00% of a share of Common Stock for each share of
                         Preferred Stock

     $23.00-$23.99       74.00% of a share of Common Stock for each share of
                         Preferred Stock

     $24.00-$24.99       72.00% of a share of Common Stock for each share of
                         Preferred Stock

     $25.00-$25.99       70.00% of a share of Common Stock for each share of
                         Preferred Stock

     $26.00-$26.99       68.00% of a share of Common Stock for each share of
                         Preferred Stock
</TABLE>

                                      -3-
<PAGE>

<TABLE>
     <S>                 <C>
     $27.00-$27.99       66.00% of a share of Common Stock for each share of
                         Preferred Stock

     $28.00-$28.99       64.00% of a share of Common Stock for each share of
                         Preferred Stock

     $29.00-$29.99       62.00% of a share of Common Stock for each share of
                         Preferred Stock

     $30.00 and above    60.00% of a share of Common Stock for each share of
                         Preferred Stock

</TABLE>

     The Market Price and the Conversion Ratio shall be adjusted as hereinafter
provided. Any such election shall be made by written notice to the Corporation's
Secretary and shall be effective on the first day on which the Common Stock is
traded after such election is received by the Corporation's Secretary.  Market
Price for the conversion shall be determined by using as the last day of the
period for determining Market Price the effective date of the election.

     (a) Adjustments to Market Price and Conversion Ratio for Certain Dividends
         ----------------------------------------------------------------------
and for Combinations or Subdivisions of Common Stock.  In the event that this
----------------------------------------------------
Corporation at any time or from time to time (i) shall declare or pay, without
consideration, any dividend on each outstanding share of the Common Stock
payable in Common Stock, (ii) shall issue Common Stock pursuant to the exercise
of a Warrant Dividend which was exercised at less than Market Price existing at
the time of the issuance of such Warrant Dividend, (iii) shall effect a
subdivision of the outstanding shares of Common Stock into a greater number of
shares of Common Stock (by stock split, reclassification or otherwise than by
payment of a dividend in Common Stock or in any warrant or right to acquire
Common Stock) or (iv) in the event the outstanding shares of Common Stock shall
be combined or consolidated, by reclassification or otherwise, into a lesser
number of shares of Common Stock, then the Market Price and Conversion Ratio for
the Series A-3 Preferred Stock in effect immediately prior to such event shall,
concurrently with the effectiveness of such event, be proportionately decreased
or increased, as appropriate, so as to protect the conversion privileges of the
Preferred Stock.  In the event that this Corporation shall declare or pay,
without consideration, any dividend on the Common Stock payable in any warrant
or right to acquire Common Stock exercisable for no consideration, then the
Corporation shall be deemed to have made a dividend payable in Common Stock in
an amount of shares equal to the maximum number of shares issuable upon exercise
of such warrant or right to acquire Common Stock.  A "Warrant Dividend" means a
dividend declared or paid by the Corporation without consideration on each
outstanding share of Common Stock and payable in a warrant or right to acquire
Common Stock.  Notwithstanding the foregoing, no adjustment for any Warrant
Dividend shall be required until, and then only to the extent that, such Warrant
Dividend has been actually exercised at less than the Market Price of Common
Stock at the time of the issuance of such Warrant Dividend.

     (b) Adjustments for Reclassification and Reorganization.  If the Common
         ---------------------------------------------------
Stock issuable upon conversion of the Series A-3 Preferred Stock shall be
changed into the same or a different number of shares of any other class or
classes of stock, whether by capital reorganization, reclassification or
otherwise (other than a subdivision or combination of shares provided for in
Section 6 above), the Market Price and Conversion Ratio then in effect shall,
concurrently with the effectiveness of such reorganization or reclassification,
be proportionately adjusted so that the Series A-3 Preferred Stock shall be
convertible into, in lieu of the number of shares of Common Stock which the
holders would otherwise have been entitled to receive, a number of shares of
such other class or classes of stock equivalent to the number of shares of
Common Stock that would have been received by the holders in the event of a
conversion of the Series A-3 Preferred Stock immediately before that change.

     (c) No Impairment.  The Corporation will not, by amendment of its
         -------------
Certificate of Incorporation or through any reorganization, transfer of assets,
consolidation, merger, dissolution, issue or sale of securities or any other
voluntary action, avoid or seek to avoid the observance or performance of any of
the terms to be

                                      -4-
<PAGE>

observed or performed hereunder by the Corporation, but will at all times in
good faith assist in the carrying out of all the provisions of this Section 6
and in the taking of all such action as may be necessary or appropriate in order
to protect the conversion provisions applicable to the Series A-3 Preferred
Stock against impairment; provided, however, that notwithstanding any other
provision hereof, the Corporation may at any time and from time to time take any
of the foregoing actions without any adjustment to the Market Price or
Conversion Ratio unless such adjustment is specifically and expressly provided
for herein.

     (d) Certificates as to Adjustments.  Upon the occurrence of each adjustment
         ------------------------------
or readjustment of any Market Price and Conversion Ratio pursuant to this
Section 6 (other than adjustments pursuant to Section 6a(ii) with respect to the
issuance of Common Stock pursuant to the exercise of a Warrant Dividend), the
Corporation at its expense shall promptly compute such adjustment or
readjustment in accordance with the terms hereof and prepare and furnish to each
holder of Series A-3 Preferred Stock a certificate executed by the Corporation's
President or Chief Financial Officer setting forth such adjustment or
readjustment and showing in detail the facts upon which such adjustment or
readjustment is based.  Upon the declaration and payment by the Corporation of a
Warrant Dividend, in lieu of the certificate described above, the Corporation at
its expense shall promptly prepare and furnish to each holder of Series A-3
Preferred Stock a certificate executed by the Corporation's President or Chief
Financial Officer stating that the Corporation has declared and paid a Warrant
Dividend and describing the terms thereof.  The Corporation shall, upon the
written request at any time of any holder of Series A-3 Preferred Stock, furnish
or cause to be furnished to such holder a like certificate setting forth (i)
such adjustments and readjustments, (ii) the Conversion Ratio for such series of
Preferred Stock at the time in effect, and (iii) the number of shares of Common
Stock which at the time would be received upon the conversion of the Series A-3
Preferred Stock.

     (e) Reservation of Stock Issuable Upon Conversion.  The Corporation shall
         ---------------------------------------------
at all times reserve and keep available out of its authorized but unissued
shares of Common Stock, solely for the purpose of effecting the conversion of
the shares of the Series A-3 Preferred Stock, such number of its shares of
Common Stock as shall from time to time be sufficient to effect the conversion
of all outstanding shares of the Series A-3 Preferred Stock; and if at any time
the number of authorized but unissued shares of Common Stock shall not be
sufficient to effect the conversion of all then outstanding shares of the Series
A-3 Preferred Stock, the Corporation will take such corporate action as may, in
the opinion of its counsel, be necessary to increase its authorized but unissued
shares of Common Stock to such number of shares as shall be sufficient for such
purpose, including, without limitation, engaging in best efforts to obtain the
requisite stockholder approval of any necessary amendment to its Certificate of
Incorporation.

     (f) Fractional Shares.  No fractional share shall be issued upon the
         -----------------
conversion of any share or shares of Series A-3 Preferred Stock.  All shares of
Common Stock (including fractions thereof) issuable upon conversion of more than
one share of Series A-3 Preferred Stock by a holder thereof shall be aggregated
for purposes of determining whether the conversion would result in the issuance
of any fractional share.  If, after the aforementioned aggregation, the
conversion would result in the issuance of a fraction of a share of Common
Stock, the Corporation shall, in lieu of issuing any fractional share, pay the
holder otherwise entitled to such fraction a sum in cash equal to the fair
market value of such fraction on the date of conversion (as determined in good
faith by the Board of Directors).

     7.   Reacquired Shares.  Any shares of Series A-3 Preferred Stock purchased
          -----------------
or otherwise acquired by the Corporation in any manner whatsoever shall be
retired and canceled promptly after the acquisition thereof.  All such shares
shall upon their cancellation become authorized but unissued shares of Preferred
Stock and may be reissued as part of a new series of Preferred Stock to be
created by resolution or resolutions of the Board of Directors, subject to the
conditions and restrictions on issuance set forth herein.

     8.   Restrictions and Limitations.  So long as any shares of Series A-1,
          ----------------------------
Series A-2 and Series A-3 Preferred Stock remain outstanding, the Corporation
shall not, (i) issue any other equity security (including any security
convertible into or exercisable for any equity security) senior to or on parity
with the Series A-1, Series A-2 or Series A-3 Preferred Stock as to dividend
rights or liquidation preferences or (ii) without the vote or written consent by
the holders of a majority of the then outstanding shares of Series A-1, Series
A-2

                                      -5-
<PAGE>

and Series A-3 Preferred Stock, voting together as a single class, amend its
Certificate of Incorporation if such amendment would change any of the rights,
preferences or privileges provided for herein for the benefit of any shares of
that series of Preferred Stock.

     9.   Definitions.
          -----------

     "IPO" means a sale of Common Stock for not less than $18.75 per share in an
underwritten offering registered under the Securities Act of 1933, as amended,
which is completed on or before March 31, 1997, which results in aggregate
proceeds to the Corporation (prior to underwriters' discounts and expenses
relating to the issuance) of $75,000,000 or more and which results in the
listing of such Common Stock on the New York Stock Exchange or the approval for
quotation of such Common Stock on the National Association of Securities Dealers
Automated Quotation System.

     "Market Price" means (i) during the first 20 consecutive days in which the
Common Stock is traded after the closing of an IPO, the price at which the
common stock was offered to the public in the IPO and (ii) thereafter, the
average closing price for a share of Common Stock as reported by the Wall Street
                                                                     ---- ------
Journal (West Coast Edition) for a period of 20 consecutive trading days
-------
immediately prior to the day as of which Market Price is being determined
(ignoring for purposes of consecutiveness days on which the market or stock
exchange on which such stock trades is not open).

     "Recapitalization Date" means the date, prior to March 31, 1997, of the
closing of an IPO.

     IN WITNESS WHEREOF, the Corporation has caused this Certificate of
Designation, Preferences and Rights of Series A-3 Preferred Stock to be duly
executed by its Chief Executive Officer and attested to by its Secretary this
2nd day of December, 1996.



                                         /s/  James J. Didion
                                         ---------------------------------------
                                                  Chief Executive Officer



                                         Attest:



                                         /s/  Karen A. Tallman
                                         ---------------------------------------
                                                 Secretary


                                      -6-