Global real estate services firm JLL saw its EBITDA fall in 2020 by almost a quarter compared to 2019, as the coronavirus crisis affected all business lines, with LaSalle's adjusted earnings before deductions slumping some 60% year-on-year.
In the EMEA region, the firm's fourth-quarter and full-year revenue and fee revenue were significantly impacted by the pandemic, falling 12% and 18% respectively year-on-year.
Adjusted EBITDA plummeted 79% for the region for the year, reflecting months of lockdown and uncertainty, which stalled leasing, property management, capital markets and development services fees.
Capital markets revenue declines for the quarter and year were most notable in Germany, France and Spain; but certain geographies reflected resiliency and market outperformance in the fourth quarter, the firm revealed.
While continued depressed office market volumes drove lower leasing revenue, particularly in the UK and Poland, strong performance in industrial partially offset this impact.
The decline in property & facility management fee revenue for the full year in the EMEA region was primarily due to approximately $52 mln (€43 mln) of lower fee revenue in the UK mobile engineering business (approximately $12 mln for the quarter).
Work delays from client office closures also had a sizeable impact, as did the absence of approximately $30 mln of prior-year fee revenue relating to property management businesses in continental Europe that were sold in late 2019.
Cost savings
But the firm reported that a range of global actions to mitigate costs had proved successful, with expense management strategies across the organisation saving some $330 mln for the full year. These non-permanent savings represent costs likely to return in future periods as the macroeconomic environment recovers.
Said Christian Ulbrich, JLL CEO: 'Our resilient 2020 performance demonstrated the diversification of the JLL global platform and our commitment to provide outstanding service to our clients.
'With disciplined financial management, we successfully leveraged our investments to drive efficiency gains and prioritised debt reduction to fortify our strong financial position.
'We accomplished this while realising the benefits of integrating HFF into our capital markets platform, realigning our cost structure and increasing cash return to shareholders. JLL enters 2021 poised to lead in a post-pandemic environment and generate substantial value for all stakeholders over the long term.'
