The news report was written by James Buckley, CoStar News Editor in London.
Jones Lang LaSalle confirmed it has won one of the largest commercial property management roles of all time, having been appointed by HSBC as its sole global facilities management (FM) provider, as tipped by CoStar News in November.
The 5-year agreement is the largest facility management contract yet awarded to a single provider on a global basis by a financial services firm. CoStar News revealed in November of last year that JLL was set to win the contract, which is thought to have a value of around $1.27 billion.
The contract will see JLL replacing all incumbent FM advisers across HSBC’s 58 million-square-foot portfolio in Europe, South America, Asia Pacific, Middle East and Africa, while continuing to serve as real estate advisor to HSBC in North America, a role JLL has had since 1998.
JLL replaces Interserve in the UK, which was awarded the $318 million FM contract in 2009. EC Harris will be replaced in Hong Kong. In EMEA alone, the contract covers more than 4,000 locations.
The new contract adds more than 42 million square feet of real estate worldwide to Jones Lang LaSalle’s responsibilities, and renews existing facility management services in North America, China, Thailand, Mexico and Panama. Jones Lang LaSalle also acts as one of HSBC’s regional transaction partners, serving its Asia Pacific, Latin America and Middle East-North Africa regions.
HSBC’s 11,000-site portfolio includes 6,000 offices with the remainder comprising of a wide spectrum of buildings ranging from ATM locations to residential properties.
One of the world's largest banking and financial services organisations, HSBC Holdings plc, the parent company of the HSBC Group, is headquartered in London. The Group serves customers worldwide from approximately 6,900 offices in more than 80 countries and territories in Europe, the Asia-Pacific region, North and Latin America, the Middle East and Africa, and had assets totaling US$2,721 billion as of 30 September 2012.
The practice of outsourcing non-core real estate functions to dedicated third-party experts has increased in recent years as service providers have attempted to expand their abilities to deliver consistent services across broader geographies and corporations have better understood the productivity benefits of outsourcing.
HSBC’s decision to outsource facility management services worldwide is designed to increase operational efficiency and consistency across its 11,000-site portfolio throughout North America, Latin America, Asia Pacific, Europe, Middle East and Africa.
Colin Dyer, president and CEO of Jones Lang LaSalle said: “Jones Lang LaSalle and HSBC are committed to introducing innovative solutions that advance the performance of real estate as a driver of measurable business improvements. Our global team is focused on improving the productivity of HSBC’s real estate through operational efficiency across its global workplaces.”
“As companies demand more consistency and control over their real estate facilities, they increasingly look for a single provider that can deliver on a global basis,” said Jordi Martin, managing director of integrated facilities management at Jones Lang LaSalle. “Being entrusted by HSBC to manage its facilities worldwide shows that this can be achieved and it is a reflection of our continued investment in building a world-class global facility management platform.”
“As real estate is typically the third largest operating cost for companies, our ability to deliver more efficient real estate operations will benefit HSBC’s overall productivity and business performance,” said Bill Thummel, Jones Lang LaSalle’s managing director, global accounts. “Our model of mixing a strategic management approach with extensive self-delivery and a commitment to supporting HSBC’s sustainability goals allows HSBC to better focus on its core business.”
"In the Americas, we will leverage our supply chain economies of scale to improve the performance of some 500 HSBC facilities in North America and an additional 4,000 more throughout Latin America," said Tod Lickerman, CEO of Jones Lang LaSalle's Americas Corporate Solutions business. "This contract will deliver consistency throughout HSBC's locations in the Americas and around the globe."
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