Commercial real estate services firm JLL posted its highest quarterly revenue on record as executives predict increasing demand this year for office and industrial space.
Chicago-based JLL, the world’s second-largest commercial real estate services firm, said profit rose 67% to $401.7 million in the fourth quarter. Revenue climbed 10% to $7.6 billion, its seventh straight quarter of double-digit growth as the firm increased its estimate for earnings before interest, taxes, depreciation and amortization.
JLL reported revenue gains across all its business segments, led by a 19% jump in property sales and financing and a 17% rise in leasing, fueled by a pickup in office and industrial deals in the United States, United Kingdom and India.
“Investor confidence is rising, more investors are deploying capital and real estate debt markets remain robust, which we expect will lead to further growth in 2026,” Chief Executive Officer Christian Ulbrich said during a conference call Wednesday to discuss the results.
Momentum is also building in JLL's leasing business, with a nascent recovery in industrial demand joining the rebound in office activity, Ulbrich said.
JLL was the fourth real estate services firm to report improved results as the industry sees recovery in transactions, with leasing and sales demand for several firms meeting or surpassing levels in 2019, before the pandemic upended dealmaking.
The results come after the shares of some commercial real estate services firms fell last week on initial concern that artificial intelligence could hurt demand for their services before the stocks began to rebound. Colliers and Marcus & Millichap also posted revenue growth, and they raised their outlooks for 2026.
Ulbrich joined his counterparts at rival firms in downplaying AI concerns. JLL sees "significant runway for profitable growth and minimal risk of disintermediation" from AI, he said. “There will always be human interaction for pretty much everything you see within our space. And that human interaction will be executed by people who have the right data at hand and have the knowledge to deliver that service.”
Leasing rebound
JLL’s stock rose as much as 7.7% on Wednesday as its earnings exceeded analysts’ expectations. The firm also posted for the full year a 45% increase in its profit to $792 million and 11% annual revenue increase to $26.1 billion.
JLL's global office leasing revenue jumped 26% in the quarter when compared to the year-earlier period, fueled by an increase in larger and longer-term deals, Chief Financial Officer Kelly Howe said.
Leases of 100,000 square feet or more increased 15% in the U.S. as companies upgraded offices for return-to-work mandates that now have private-sector employees working in offices for an average of four days per week, Howe said.
"We've definitely seen a recovery in large deals," Howe said. "That really plays to our strength."
JLL's industrial leasing revenue rose 11% in the fourth quarter and has stayed strong in the early months of this year, Howe said.
"We believe that the industrial leasing business has bottomed out and looks like it's building momentum again," she said. "We expect continued acceleration around that particular segment and our pipelines look strong."
JLL also had "a very strong fourth quarter around data centers," Ulbrich said.
Unlike its larger rival CBRE, JLL does not provide specific numbers on revenue from data center leasing, property sales and management.
However, JLL said it doubled its revenue in those areas over the past year, including an uptick in data center deals in the fourth quarter.