Commercial real estate services firm JLL posted a 33% profit gain, fueled by its fifth-straight quarter of double-digit revenue growth, as executives predict a steady increase in deals for the rest of the year.
Chicago-based JLL, the world's second-largest firm of its kind, said earnings rose to $112.3 million for the second quarter from $84.4 million for the same time in 2024. JLL joined rivals CBRE, Newmark, Cushman & Wakefield and Colliers in posting revenue gains and higher earnings expectations for the full year.
JLL's revenue rose 10% to $6.25 billion in the recent quarter, led by gains in workplace, project and property management and other non-transaction business. Executives say those business lines are less susceptible to economic and real estate market fluctuations.
The firm raised the low end of its target full-year adjusted earnings before interest, taxes depreciation and amortization by $50 million to a new range of $1.3 billion to $1.45 billion.
“Regarding our 2025 full-year financial outlook, the market backdrop overall remains constructive, despite mixed economic indicators and the evolving policy environment,” CEO Christian Ulbrich said during an earnings call on Wednesday.
Transaction revenue grew 7% from the year-earlier period, led by a double-digit gain in its capital markets business, including property sales, financing and debt advisory.
Office, industrial leasing
Leasing revenue rose 5%, driven by strength in JLL’s office and industrial business in the United States and office deals in the firm’s Asia Pacific region. U.S. office leasing revenue increased for the sixth straight quarter, growing nearly 3%, JLL said.
"Client demand for high-quality and energy-efficient assets, which are becoming increasingly scarce, remains a consistent trend," said Kelly Howe, JLL's new chief financial officer. "Tenant requirements are generally steady, with sectors such as professional services, finance, and legal driving demand in many markets."
Despite the gains, Ulbrich said transaction activity slowed in the second quarter from the first three months of the year as some businesses weighed the effects of geopolitical and trade policy pressures.
"We saw an uptick in delayed and prolonged decision-making, particularly in industrial and manufacturing, and for more significant capital projects and investment decisions,” Ulbrich said.
Stephen Sheldon, a William Blair analyst who tracks real estate businesses with brokerages, said “we had somewhat higher hopes” for larger gains in JLL’s transaction business, given that some of its rivals reported bigger increases in deal activity.
JLL’s focus on larger deals — some of which are getting delayed by economic concerns — is likely weighing somewhat on the global brokerage’s performance, Sheldon said in a note to investors.
Rising property sales
JLL's capital markets business climbed to $520.3 million in the quarter, up 12% from the year-earlier time, led by strength in property sales and financing.
"We are encouraged by the stability of the debt markets and capital availability, alongside the amount of dry powder on the sidelines," Ulbrich said.
The firm's pipeline of financing and sales deals in progress remains fairly strong, particularly for retail and residential properties — though the economic outlook will determine how long it will take to finish transactions, he added.
"We are fairly optimistic around that performance of the capital markets business, because it seems that people are accepting the noise in the world, and they just move on and do their business," Ulbrich said.