JLL Sees 16% Revenue Growth Driven By Office Leasing, Capital Markets Improvements

Strengthening commercial real estate market fundamentals boosted JLL's business in the fourth quarter, and its executives see that momentum continuing this year. 

The Chicago-based commercial real estate giant reported $6.8B in revenue in the fourth quarter, up 16% year-over-year, and its adjusted earnings was up 15%.

The firm's earnings growth was driven by increases in deal flow across the CRE market. Its overall transaction revenue was up 22%, including capital markets revenue growth of 32% and leasing revenue growth of 14%. 

JLL's executives said on its Wednesday morning earnings call they are seeing this strength continue this quarter, and they are projecting the firm's adjusted earnings before interest, taxes, deductions and amortizations will grow 14% this year. 

"Our leasing business is benefiting from the increasing return-to-office mandates," JLL CEO Christian Ulbrich said. 

The company's global office leasing reached its highest level since 2019, JLL Chief Financial Officer Karen Brennan said. That segment's 20% revenue growth last quarter drove JLL's Market Advisory segment to increase revenue by 11%. 

"That's quite encouraging as we think about all that's transpired since 2020," Brennan said. 

In its capital markets segment, JLL's 32% revenue increase was driven by investment sales and debt and equity advisory, most notably in the U.S. and Asia Pacific. In those markets, revenue was up across sectors, with residential and industrial properties leading the charge.

Investment sales in the U.S. grew 60% in the fourth quarter and roughly 30% for the full year. The company's global debt advisory revenue grew 70%, with the U.S. and Asia Pacific outperforming other markets.

"In the first couple of weeks in '25, we saw a really strong start to our capital markets business," Ulbrich said. "If interest rates are staying more or less in line where they are today, we expect that trend to be pretty stable for the rest of the year."

Brennan also said the firm is encouraged by the strength of the real estate debt market. 

"Banks are more actively quoting on and closing loans in the U.S.," he said. 

The one business line that didn't record revenue growth was its JLL Technologies division, which was down 9% in the fourth quarter and 8% for the full year.

JLL has pushed heavily into the proptech sector, investing in startups through its JLL Spark venture fund, partnering with proptech company HqO in 2022 and acquiring tech-powered brokerage Raise Commercial Real Estate in October.

The company said it saw negative returns for its technology platform this quarter due to "low contract signings in technology solutions over the past year, partially offset by modest growth in software services."

JLL executives said they see its technology investments as a differentiator for the firm, particularly in the booming artificial intelligence sector. When Ulbrich was asked about his expectations for the profitability of JLL Technologies moving forward, he said he is eager to make the business profitable on a full-year basis.

"We have to balance that trajectory with investing into the platform seeing specific growth areas, but at the same time, don't lose sight of bringing it back into profitability," he said. "[Our proptech portfolio] enhances our core business with cutting-edge technology, and it delivers superior technology to clients, so we are not overly disturbed by those variances."