JLL Q3 Adjusted EPS Jumps 50% on Leasing and Capital Markets Growth

Jones Lang LaSalle said third-quarter earnings rose sharply as stronger leasing and capital-markets activity combined with operating leverage to lift profitability. Revenue increased 12% year over year to $7.28 billion, while adjusted diluted earnings per share climbed 50% to $6.76.

Adjusted EBITDA rose 33% to $460.2 million, and adjusted net income increased 45% to $315.5 million. On a GAAP basis, net income attributable to common shareholders was $319.8 million, up from $222.8 million, while diluted EPS increased to $6.85 from $4.61.

The results were led by JLL’s transaction-oriented businesses. Leasing Advisory revenue grew 27% in local currency to $942 million, with adjusted EBITDA up 48% to $202 million. Capital Markets Services revenue advanced 21% to $737 million, while adjusted EBITDA increased 47% to $131 million.

Leasing and capital markets lead growth

Leasing Advisory benefited from stronger U.S. activity across industrial, office and data-center properties. U.S. leasing revenue rose 39%, primarily because of a meaningful increase in average deal size, offsetting declines in certain other geographies.

JLL said its office leasing revenue grew 9%, compared with a 5% increase in global market volumes. In the U.S., office leasing revenue rose 18% against market-volume growth of 2%. U.S. industrial leasing revenue increased 56%, exceeding the 38% growth in industry volumes. Higher revenue, after increased commission expense, and incremental platform leverage supported the segment’s profit growth.

Capital Markets Services recorded broad-based gains across geographies and property sectors. Investment-sales revenue increased 33%, debt-advisory revenue rose 13% and equity-advisory revenue climbed 39%. The U.S. and Japan led the geographic increase.

Global investment-sales revenue growth of 33% compared with a 9% rise in broader market activity, while JLL’s U.S. investment-sales revenue increased 34% against market growth of 11%. Adjusted EBITDA also benefited from lower loan-related expenses and incremental platform leverage, in addition to higher transaction revenue.

Real Estate Management Services remained JLL’s largest business, with revenue rising 9% in local currency to $5.50 billion. Adjusted EBITDA increased 13% to $115 million. Workplace Management growth reflected a broadly balanced mix of expanded mandates and new client wins, while Project Management posted double-digit growth led by the U.S. and India. Those gains outweighed softness in Australia and parts of Europe.

Investment Management was the only segment to contract. Revenue declined 7% in local currency to $105 million, and adjusted EBITDA fell 20% to $18 million, mainly because of lower incentive and transaction fees. Advisory fees were broadly stable as benefits from recent fundraising in the Americas offset anticipated lower fees from Asia-Pacific funds. Assets under management increased 2% during the quarter in both U.S. dollars and local currency, but were flat in dollars over the trailing 12 months.

2026 targets and capital returns

JLL’s 2026 financial targets call for adjusted EPS of $25.20 to $26.30, representing 37% growth at the midpoint and assuming continued activity under its share-repurchase authorization. The company targets mid- to high-single-digit revenue growth for Real Estate Management Services, high-teens growth for Leasing Advisory and mid-teens growth for Capital Markets Services. For Investment Management, it expects low-single-digit advisory-fee growth, with incentive and transaction fees toward the low end of their historical range.

The company repurchased $142 million of shares during the third quarter, bringing the year-to-date total to $552 million at an average price of $321 per share. JLL said it intends to execute a new $500 million accelerated share repurchase imminently, which would take full-year repurchases above $1 billion. As of September 30, $2.5 billion remained authorized for repurchases, and the share count was 3.2% lower than a year earlier.

Net debt declined to $859 million from $1.19 billion at the end of the second quarter and $1.10 billion a year earlier, reflecting positive third-quarter free cash flow and improved trailing-12-month free cash flow. Net debt was 0.5 times adjusted trailing-12-month EBITDA, compared with 0.7 times in the prior quarter. Corporate liquidity totaled $3.57 billion.

JLL’s presentation described commercial real estate markets as broadly growing and functioning, with global investment-sales volumes up 9% in the quarter and office leasing volumes up 5%. However, investors continued to face higher bond yields, early indications of tighter credit conditions and pricing adjustments in selected transactions. The company also cautioned that its targets, planned repurchases and other forward-looking statements remain subject to economic, market and company-specific risks that could cause actual results to differ materially.