JLL fee revenue dips in EMEA as global revenue rises

JLL’s European branch saw fee revenue ease slightly in 2019 in a difficult year for the sector with political uncertainty stalling deals. But on a wider group level, the firm posted double-digit jumps in revenue and fee income for 2019. The firm reported annual revenue of $17.98bn (£14bn), up 10% year on year, and quarterly revenue was $5.4bn, up 10% on the quarter. The property agent’s overall fee revenue rose by 12% to $7.1bn during the year. Its capital markets business saw the strongest increase, with income rising by 35% to $1.5bn, followed by project and development services (17%), and advisory and consulting (11%). JLL chief executive Christian Ulbrich said: “JLL delivered a record fourth quarter to finish out an excellent 2019 for our clients, employees and shareholders. Our focus on generating profitable growth and driving productivity initiatives resulted in strong organic revenue gains and margin expansion, on top of the successful integration of HFF, our largest acquisition ever. “We enter 2020 with optimism and confidence in our ability to continue to take market share and capitalize on long-term growth opportunities.” JLL acquired capital markets services provider HFF in a transaction valued at $2bn in July last year. The deal resulted in a yearly increase in net debt for the firm, which stood at $860.9m as of December 31, 2019. This represented an increase of $633.9m from December 31, 2018. The firm the year-to-date increase reflected around $840m of net cash outflow to buy HFF. The firm’s EMEA division posted a 1% fall in overall revenue for the year to $3.5bn. It also saw a 3% fall in fee revenue for the year from $1.71bn to $1.66bn and a 2% quarterly drop from $574.1m to $559.8m. EMEA capital markets saw the biggest annual fall, at 11%, to $391.5m and 8% on quarter to $156.5m. Leasing took the second largest drop of 9% on year to $295.7m and 7% on quarter to $110.2m. The division was supported by better performances in project and development services which saw fee income rise 3% on year to $297.2m and 6% on quarter to $91.9m. Ulbrich said: “After the vote in December, there was an immediate uptick in the UK business. So December came in significantly stronger than otherwise without that vote. For the time being, we expect the UK to have a stronger year than it had in 2019. But what waits to be seen is how the conversations between the UK and Europe will actually go over the course of the year. So we have to see how the third and the fourth quarter will play out. “Overall, we expect a much better performance in 2020 in our EMEA business than in our EMEA business in 2019, which is less down to the market, but more down to all the decisions and activities we have been taking in 2019 to prepare ourselves for 2020.” In the Americas, fee revenue hit $3.8bn up 21% from $3.2bn the previous year, as well as a 22% hike in quarterly fee revenue to $1.2bn in Q4. Fee revenue also grew in Asia Pacific, reaching $1.1bn last year, up 3% and inching up 1% on quarter to $353.8m. To send feedback, e-mail anna.ward@egi.co.uk or tweet @annaroxelana or @estatesgazette