JLL sees investors hesitate as Ukraine war continues
The top team at JLL has pointed to an improved performance from its European operations over the start of the year – but warned that the war in Ukraine is having a notable impact on confidence in some markets, including Germany.
Chief executive Christian Ulbrich (pictured) welcomed a “very strong performance” in the region from the capital markets business and noted that it posted the strongest regional growth rate for investment sales. But he added that there is now a slowdown apparent as events in Ukraine take their toll.
“EMEA is a combination of many, many countries, and there is, if you generalise this, slightly more hesitation the closer you come to Ukraine,” Ulbrich said on an analyst call to discuss the agency’s first-quarter results.
The top team at JLL has pointed to an improved performance from its European operations over the start of the year – but warned that the war in Ukraine is having a notable impact on confidence in some markets, including Germany.
Chief executive Christian Ulbrich (pictured) welcomed a “very strong performance” in the region from the capital markets business and noted that it posted the strongest regional growth rate for investment sales. But he added that there is now a slowdown apparent as events in Ukraine take their toll.
“EMEA is a combination of many, many countries, and there is, if you generalise this, slightly more hesitation the closer you come to Ukraine,” Ulbrich said on an analyst call to discuss the agency’s first-quarter results.
“So Eastern Europe is suffering the most, but interestingly enough, Germany – which was always perceived as the safe haven – is feeling some hesitations from overseas investors. There’s still enough capital at the sideline so that you don’t see that currently in the transaction volumes, but it’s something which we know because we do so many transactions every day.”
This week the company announced first-quarter results that showed revenue up by a fifth year-on-year at $4.8bn (£3.8bn), and adjusted EBITDA of $273.6m, up by 44%.
The results marked the first time JLL has reported numbers for global business lines rather than detailing performance geography by geography. Last year the EMEA division posted an annual loss of $5.6m.
Asked on the earnings call about the EMEA-specific outlook, chief financial officer Karen Brennan said: “EMEA has been an area of focus for us over the past several quarters, given profitability and our intention to improve that. We’re happy with how that’s progressing in EMEA.
“We had, overall, 29% growth in our fee revenue compared to the prior year, and that was both from capital markets but also within market advisory and our work dynamics business.”
Brennan continued: “We’re pleased with how things have progressed there and are continuing to focus on our cost structure and driving efficiencies. And we were able to pull through that top line growth, particularly in capital markets, to improve profitability.”
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