What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2021-05-06 compared with 2020-11-02 · 227 added, 350 removed, 433 unchanged (57% of the section changed)

2 unchanged sentences

CONDENSED CONSOLIDATED BALANCE SHEETS

(in millions, except share and per share data)

September 30, 2020

December 31, 2019

(in millions, except share and per share data) March 31, 2021 December 31, 2020

Assets (unaudited)

Current assets:

1 unchanged sentence

Trade receivables, net of allowance of $ 70.2 and $ 66.5

1,477.4 1,636.1

Notes and other receivables 399.9 469.9

6 unchanged sentences

Operating lease right-of-use assets 706.5 707.4

Goodwill 4,201.7 4,224.7

Identified intangibles, net of accumulated amortization of $ 312.3 and $ 295.3

3 unchanged sentences

Deferred compensation plan 480.2 446.3

Other 186.6 182.3

Total assets $ 13,306.4 14,316.5

Liabilities and Equity

8 unchanged sentences

Short-term operating lease liabilities 159.1 165.7

Other 198.5 299.6

Total current liabilities 4,691.8 6,127.8

Credit facility, net of debt issuance costs of $ 7.7 and $ 8.7

342.3 ( 8.7 )

Long-term debt, net of debt issuance costs of $ 2.3 and $ 2.5

3 unchanged sentences

Long-term operating lease liabilities 692.4 683.9

Other 582.1 597.5

Total liabilities 7,591.7 8,698.7

7 unchanged sentences

Treasury stock, at cost, 767,240 and 864,890 shares

( 85.7 ) ( 96.1 )

Shares held in trust ( 5.4 ) ( 5.6 )

2 unchanged sentences

Noncontrolling interest 86.7 89.2

Total equity 5,706.9 5,610.0

Total liabilities, redeemable noncontrolling interest and equity $ 13,306.4 14,316.5

2 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(in millions, except share and per share data) (unaudited)

Three Months Ended September 30,

Nine Months Ended September 30,

(in millions, except share and per share data) (unaudited) Three Months Ended March 31,

Revenue before reimbursements $ 2,129.6 2,233.0

10 unchanged sentences

Interest expense, net of interest income 10.4 14.6

Equity earnings

Equity earnings (losses) 48.5 ( 28.3 )

Other income 11.8 0.9

Income before income taxes and noncontrolling interest 130.6 22.6

Income tax provision 28.2 5.0

Net income attributable to noncontrolling interest

Net income attributable to the Company

Dividends on unvested common stock, net of tax benefit

Net income 102.4 17.6

Net (loss) income attributable to noncontrolling interest ( 0.6 ) 12.3

Net income attributable to common shareholders $ 103.0 5.3

3 unchanged sentences

Diluted weighted average shares outstanding (in 000's) 52,175 52,458

Dividends declared per share

Net income attributable to the Company

Net income attributable to common shareholders $ 103.0 5.3

Change in pension liabilities, net of tax ( 0.2 ) —

Foreign currency translation adjustments ( 6.2 ) ( 143.4 )

Comprehensive income attributable to the Company

Comprehensive income attributable to common shareholders $ 96.6 ( 138.1 )

See accompanying notes to Condensed Consolidated Financial Statements.

1 unchanged sentence

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2020 AND 2019

FOR THE THREE MONTHS ENDED MARCH 31, 2021 AND 2020

Company Shareholders' Equity

Common Stock Additional Shares

(in millions, except share and

per share data) (unaudited)

per share data) (unaudited) Outstanding Paid-In Retained Held in Treasury Total

Shares Amount Capital Earnings Trust Stock AOCI (1)

December 31, 2020 51,105,417 $ 0.5 2,023.3 3,975.9 ( 5.6 ) ( 96.1 ) ( 377.2 ) 89.2 $ 5,610.0

Net income (loss) — — — 103.0 — — — ( 0.6 ) 102.4

Shares issued under stock-based compensation programs 290,563 — ( 15.6 ) — — 15.9 — — 0.3

2 unchanged sentences

Shares held in trust — — — — 0.2 — — — 0.2

Cumulative effect from adoption of new accounting for credit losses

Repurchase of common stock

Change in pension liabilities, net of tax — — — — — — ( 0.2 ) — ( 0.2 )

Foreign currency translation adjustments — — — — — — ( 6.2 ) — ( 6.2 )

1 unchanged sentence

March 31, 2021 51,306,200 $ 0.5 2,015.5 4,078.9 ( 5.4 ) ( 85.7 ) ( 383.6 ) 86.7 $ 5,706.9

Net income (3)

Shares issued under stock-based compensation programs

Shares repurchased for payment of taxes on stock-based compensation

Amortization of stock-based compensation

Shares held in trust

Foreign currency translation adjustments

Increase in amounts attributable to noncontrolling interest

June 30, 2020

Company Shareholder's Equity

Additional Shares

(in millions, except share and

per share data) (unaudited) Common Stock Paid-In Retained Held in Treasury Total

Shares Amount Capital Earnings Trust Stock AOCI (1)

December 31, 2019 51,549,654 $ 0.5 1,962.8 3,588.3 ( 5.7 ) — ( 427.8 ) 86.6 $ 5,204.7

Net income — — — 5.3 — — — 12.3 17.6

3 unchanged sentences

Shares held in trust — — — — 0.1 — — — 0.1

Cumulative effect from adoption of new accounting for credit losses — — — ( 14.9 ) — — — — ( 14.9 )

Repurchase of common stock ( 187,753 ) — — — — ( 25.0 ) — — ( 25.0 )

Change in pension liabilities, net of tax

Foreign currency translation adjustments — — — — — — ( 143.4 ) — ( 143.4 )

Decrease in amounts attributable to noncontrolling interest — — — — — — — ( 17.0 ) ( 17.0 )

September 30, 2020

March 31, 2020 51,622,839 $ 0.5 1,969.6 3,578.7 ( 5.6 ) ( 25.0 ) ( 571.2 ) 81.9 $ 5,028.9

Accumulated other comprehensive income (loss)

Noncontrolling interest

(3) Excludes net (loss) income attributable to redeemable noncontrolling interest of $( 0.2 ) million and $ 0.1 million for the three months ended September 30, 2020 and June 30, 2020, respectively.

JONES LANG LASALLE INCORPORATED

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (CONTINUED)

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2020 AND 2019

Company Shareholder's Equity

(in millions, except share and

per share data) (unaudited)

Comprehensive

Noncontrolling

December 31, 2018

Shares issued under stock-based compensation programs

Shares repurchased for payment of taxes on stock-based compensation

Amortization of stock-based compensation

Change in pension liabilities, net of tax

Foreign currency translation adjustments

Increase in amounts attributable to noncontrolling interest

March 31, 2019

Net income (3)

Shares issued under stock-based compensation programs

Shares repurchased for payment of taxes on stock-based compensation

Amortization of stock-based compensation

Dividends paid

Shares held in trust

Change in pension liabilities, net of tax

Foreign currency translation adjustments

Increase in amounts attributable to noncontrolling interest

June 30, 2019

Shares issued under stock-based compensation programs

Acquisition of HFF

Shares repurchased for payment of taxes on stock-based compensation

Amortization of stock-based compensation

Shares held in trust

Change in pension liabilities, net of tax

Foreign currency translation adjustments

Increase in amounts attributable to noncontrolling interest

September 30, 2019

(3) Excludes net income attributable to redeemable noncontrolling interest of $ 0.1 million for the three months ended June 30, 2019.

See accompanying notes to Condensed Consolidated Financial Statements.

1 unchanged sentence

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Nine Months Ended September 30,

Three Months Ended March 31,

(in millions) (unaudited) 2021 2020

Cash flows from operating activities:

Adjustments to reconcile net income to net cash used in operating activities:

Net income $ 102.4 17.6

Reconciliation of net income to net cash provided by operating activities:

Depreciation and amortization 53.0 55.0

Equity (earnings) losses ( 48.5 ) 28.3

Net gain on dispositions ( 11.4 ) —

Distributions of earnings from real estate ventures 0.4 3.6

Other adjustments, net

Changes in working capital, net

Net cash provided by (used in) operating activities

Provision for loss on receivables and other assets ( 0.5 ) 38.1

Amortization of stock-based compensation 17.5 18.6

Net non-cash mortgage servicing rights and mortgage banking derivative activity ( 9.7 ) 1.6

Accretion of interest and amortization of debt issuance costs 1.2 1.4

Other, net ( 3.9 ) ( 10.8 )

Receivables 154.0 250.4

Reimbursable receivables and reimbursable payables ( 107.6 ) ( 58.7 )

Prepaid expenses and other assets ( 32.4 ) ( 45.9 )

Deferred tax assets, net ( 2.7 ) ( 5.5 )

Accounts payable and accrued liabilities ( 189.2 ) ( 187.8 )

Accrued Compensation ( 384.4 ) ( 652.0 )

Net cash used in operating activities ( 461.8 ) ( 546.1 )

Cash flows from investing activities:

4 unchanged sentences

Distributions of capital from real estate ventures 4.0 13.4

Other, net 4.0 ( 2.3 )

Net cash used in investing activities ( 97.8 ) ( 90.5 )

2 unchanged sentences

Repayments of borrowings under credit facility ( 892.0 ) ( 1,630.0 )

Net (repayments of) proceeds from short-term borrowings

Net proceeds from (repayments of) short-term borrowings 36.8 6.6

Payments of deferred business acquisition obligations and earn-outs ( 21.0 ) ( 9.8 )

Repurchase of common stock — ( 25.0 )

Payment of dividends

Net cash (used in) provided by financing activities

Other, net 10.9 ( 13.5 )

Net cash provided by financing activities 376.7 883.3

Effect of currency exchange rate changes on cash, cash equivalents and restricted cash ( 12.4 ) ( 21.1 )

6 unchanged sentences

Cash paid during the period for:

Interest $ 4.5 9.3

Income taxes, net of refunds 30.5 44.4

2 unchanged sentences

Business acquisitions (including contingent consideration) $ 3.8 —

Deferred business acquisition obligations

Non-cash consideration received for disposition 23.9 —

See accompanying notes to Condensed Consolidated Financial Statements.

2 unchanged sentences

INTERIM INFORMATION

Readers of this quarterly report should refer to the audited financial statements of Jones Lang LaSalle Incorporated ("JLL," which may also be referred to as "the Company" or as "we," "us" or "our") for the year ended December 31, 2019 , which are included in our 2019 Annual Report on Form 10-K, filed with the United States Securities and Exchange Commission ("SEC") and also available on our website ( www.us.jll.com ), since we have omitted from this quarterly report certain footnote disclosures which would substantially duplicate those contained in such audited financial statements.

Readers of this quarterly report should refer to the audited financial statements of Jones Lang LaSalle Incorporated ("JLL," which may also be referred to as "the Company" or as "we," "us" or "our") for the year ended December 31, 2020, which are included in our 2020 Annual Report on Form 10-K, filed with the United States Securities and Exchange Commission ("SEC") and also available on our website ( www.jll.com ), since we have omitted from this quarterly report certain footnote disclosures which would substantially duplicate those contained in such audited financial statements.

You should also refer to the "Summary of Critical Accounting Policies and Estimates" section within Item 7.

Management's Discussion and Analysis of Financial Condition and Results of Operations and to Note 2, Summary of Significant Accounting Policies, in the Notes to Consolidated Financial Statements in our 2020 Annual Report on Form 10-K for further discussion of our significant accounting policies and estimates.

Our Condensed Consolidated Financial Statements as of September 30, 2020 , and for the periods ended September 30, 2020 and 2019 , are unaudited.

Our Condensed Consolidated Financial Statements as of March 31, 2021, and for the three months ended March 31, 2021 and 2020, are unaudited.

In the opinion of management, we have included all adjustments (consisting solely of normal recurring adjustments) necessary for a fair presentation of the Condensed Consolidated Financial Statements for these interim periods.

4 unchanged sentences

leasing and capital markets) is driven by the size and timing of our clients' transactions and can fluctuate significantly from period to period.

The COVID-19 pandemic may have a material impact on the historical seasonality of our revenue and profits.

In 2020 and the three months ended March 31, 2021, macroeconomic conditions influenced by the COVID-19 pandemic impacted the historical seasonality of our revenue and profits and may continue to do so during the remainder of 2021.

A significant portion of our compensation and benefits expense is from incentive compensation plans, which we generally accrue throughout the year based on progress toward annual performance targets.

3 unchanged sentences

As required, we adjust for the impact of discrete items in the quarters in which they occur.

Changes in the geographic mix of income, including as a result of the COVID-19 pandemic, can impact our estimated effective tax rate.

As a result of the items mentioned above, the results for the periods ended September 30 are not fully indicative of what our results will be for the full fiscal year.

Changes in the geographic mix of income can impact our estimated effective tax rate.

As a result of the items mentioned above, the results for the periods ended March 31 are not fully indicative of what our results will be for the full fiscal year.

NEW ACCOUNTING STANDARDS

Recently adopted accounting guidance

In June 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No.

2016-13, Financial Instruments - Credit Losses (ASC Topic 326) , which created a new framework to evaluate financial instruments, such as trade receivables, for expected credit losses.

This new framework replaced the existing incurred loss approach and is expected to result in more timely recognition of credit losses.

On January 1, 2020, we adopted ASU No.

2016-13 using a modified-retrospective approach, as required by the ASU.

The adoption impacted our methodology of reserving for (i) Trade receivables, (ii) other receivable-related financial assets, specifically contract assets, and (iii) off-balance sheet credit exposures within the scope of this ASU.

Specifically, we evaluated our historical reserve balances for Trade receivables and the related write-off activity and developed a forward-looking process for adoption.

We also evaluated our loss-sharing guarantee obligation for certain mortgage loans we originate, sell and retain the servicing rights.

The following sections discuss our updated reserve methodologies.

Trade Receivables

We estimate an allowance to provide for uncollectible accounts receivable, which is applied upon recognition of the receivable.

We base this estimate on historical experience combined with a review of the receivable aging, current and expected economic conditions, and client credit quality.

The estimate also includes specifically identified amounts for which payment has become unlikely.

As trade receivables are due within one year, changes to economic conditions are not expected to have a significant impact on our estimate of expected credit losses.

However, we will monitor economic conditions on a quarterly basis to determine if any adjustments are deemed necessary.

Notes and Other Receivables and Long-Term Receivables

We make ongoing assessments of the collectability of outstanding Notes and other receivables and Long-term receivables, considering both objective and subjective factors such as the aging profile of outstanding balances, the contractual terms of repayment, and credit quality.

Aspects of credit quality considered in our assessments of collectability include historical experience, current and expected economic conditions, and our broader business relationship with the obligor.

We record an allowance against the outstanding balance when our assessments determine payment has become unlikely.

After all collection efforts have been exhausted by management, the outstanding balance is written off against the reserve.

Historically, credit quality deterioration to the point of impairment or non-performance in our Notes and other receivables and Long-term receivables has been limited and has not had a material impact on the Condensed Consolidated Financial Statements.

Reimbursable Receivables

We record an allowance based on specific identification of an uncollectible reimbursable receivable, considering current and future economic conditions as well as client credit quality.

Historically, we have not experienced any material collection issues and, as such, have not applied a formulaic reserve to these receivables.

Contract Assets

Contract assets include amounts recognized as revenue for which we are not yet entitled to payment for reasons other than the passage of time, but that do not constrain revenue recognition.

Historically, we have not recognized a provision for contract assets.

Under ASC Topic 326, we include Contract assets in our reserving process and assess the risk of loss similar to our methodology for Trade receivables, since Contract assets are reclassified to Trade receivables when we become entitled to payment.

Accordingly, a reserve is applied upon recognition of the contract asset.

Financial Guarantees

Certain loans we originate and sell under the Fannie Mae Delegated Underwriting and Servicing (“DUS”) program retain a percentage of the risk of loss.

This loss-sharing aspect of the program represents an off-balance sheet credit exposure, and we have established a contingent reserve ("loan loss guarantee reserve") for this risk in accordance with ASC Topic 326.

To estimate the reserve, we use a model that analyzes historical losses, current and expected economic conditions, and reasonable and supportable forecasts.

The model also considers specific details of the underlying property used as collateral, such as occupancy and financial performance.

The loan loss guarantee reserve is calculated on an individual loan level.

As of September 30, 2020, the loan loss guarantee reserve was $ 45.7 million and was included within Other liabilities on the Condensed Consolidated Balance Sheets.

This balance reflected a notable increase from our opening balance (reflected in the table below) as a result of incorporating, into our model, economic conditions and projections related to the COVID-19 pandemic.

The loss-sharing guarantee obligation (in accordance with ASC Topic 460, Guarantees ) represents the non-contingent obligation incurred as a result of issuing a loss-sharing guarantee as part of our participation in the DUS program and is separate from the loan loss guarantee reserve discussed above.

See Note 10, Commitments and Contingencies , for further information on the DUS program and the loss-sharing guarantee obligation.

The following table details the cumulative impact to retained earnings upon adoption of ASC Topic 326.

Adjustment due to

As Reported Under

December 31, 2019

ASC Topic 326 on January 1, 2020

(in millions)

ASC Topic 326

Allowance for trade receivables

Deferred tax assets, net

Allowance for contract assets (1)

Liabilities and equity

Loan loss guarantee reserve (2)

Retained earnings

1 The portion of the allowance for long-term contract assets is included within Other assets on the Condensed Consolidated Balance Sheets.

2 Included within Other liabilities on the Condensed Consolidated Balance Sheets

In January 2020, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2020‑01, Investments-Equity Securities (Topic 321), Investments-Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815) , which, among other things, clarifies that a company should consider observable transactions that require a company to either apply or discontinue the equity method of accounting under Topic 323 and clarifies that, when determining the accounting for certain forward contracts and purchased options a company should not consider, whether upon settlement or exercise, if the underlying securities would be accounted for under the equity method or fair value option.

This ASU is effective for annual and interim periods beginning after December 15, 2020, with early adoption permitted.

The adoption of this guidance did not impact our financial statements and related disclosures.

REVENUE RECOGNITION

1 unchanged sentence

Such revenue was included entirely within Americas Capital Markets and is presented below.

Three Months Ended September 30,

Nine months ended

September 30,

Three months Ended March 31,

(in millions) 2021 2020

3 unchanged sentences

Such contract assets and liabilities are presented below.

(in millions)

September 30, 2020

December 31, 2019

(in millions) March 31, 2021 December 31, 2020

Contract assets, gross $ 348.3 347.8

3 unchanged sentences

Remaining performance obligations - Remaining performance obligations represent the aggregate transaction price for contracts where our performance obligations have not yet been satisfied.

As of September 30, 2020 , the aggregate amount of transaction price allocated to remaining performance obligations represented less than 5 % of our total revenue.

As of March 31, 2021, the aggregate amount of transaction price allocated to remaining performance obligations represented less than 5 % of our total revenue.

In accordance with ASC Topic 606, excluded from the aforementioned remaining performance obligations are (i) amounts attributable to contracts expected to be completed within 12 months and (ii) variable consideration for services performed as a series of daily performance obligations, such as facilities management, property management, and LaSalle contracts.

12 unchanged sentences

The Chief Operating Decision Maker of JLL measures and evaluates the segment results based on Segment income for purposes of making decisions about allocating resources and assessing performance.

As of September 30, 2020 , we define the Chief Operating Decision Maker collectively as our Global Executive Board, which comprises the following:

• Chief Executive Officer and President

• Chief Executive Officers of each of our four business segments

• Chief Financial Officer

• Chief Executive Officer of Corporate Solutions

• Chief Human Resources Officer

• Chief Executive Officer of Capital Markets

• Co-Chief Executive Officers of JLL Technologies

Summarized financial information by business segment is as follows.

Three Months Ended September 30,

Nine Months Ended September 30,

Three Months Ended March 31,

(in millions) 2021 2020

Leasing $ 363.7 418.9

Capital Markets 216.9 247.4

2 unchanged sentences

Advisory, Consulting and Other 98.7 91.6

Revenue $ 2,443.9 2,523.1

Depreciation and amortization $ 33.1 37.4

1 unchanged sentence

Segment income $ 145.0 94.6

Leasing $ 54.4 48.1

Capital Markets 74.2 73.2

2 unchanged sentences

Advisory, Consulting and Other 59.8 56.4

Revenue $ 716.2 755.9

Depreciation and amortization $ 10.9 9.2

Equity earnings (losses)

Segment income (loss)

Equity earnings $ — —

Segment loss $ ( 35.8 ) ( 20.5 )

Leasing $ 31.4 25.4

Capital Markets 29.3 21.7

2 unchanged sentences

Advisory, Consulting and Other 51.7 38.2

Revenue $ 785.8 712.1

Depreciation and amortization $ 7.3 6.6

Equity earnings

Equity earnings (losses) $ 1.0 ( 0.7 )

Segment income $ 17.8 2.4

2 unchanged sentences

Incentive fees — 5.7

Revenue $ 91.2 104.9

Depreciation and amortization $ 1.7 1.8

Equity earnings (losses) $ 13.0 ( 40.3 )

Segment income

Segment income (loss) $ 19.4 ( 26.1 )

The following table is a reconciliation of Segment income to consolidated Operating income.

Three Months Ended September 30,

Nine Months Ended September 30,

Three Months Ended March 31,

(in millions) 2021 2020

Segment income - Americas $ 145.0 94.6

Segment income (loss) - EMEA

Segment loss - EMEA ( 35.8 ) ( 20.5 )

Segment income - APAC 17.8 2.4

Segment income - LaSalle

Equity earnings

Segment income (loss) - LaSalle 19.4 ( 26.1 )

Equity (earnings) losses ( 48.5 ) 28.3

Restructuring and acquisition charges ( 17.2 ) ( 14.1 )

2 unchanged sentences

2021 Business Combinations Activity

During the nine months ended September 30, 2020 , we completed no new acquisitions and paid $ 58.5 million for deferred business acquisition and earn-out obligations for acquisitions completed in prior years.

During the three months ended March 31, 2021, we paid $ 26.2 million for deferred business acquisition and earn-out obligations for acquisitions completed in prior years.

2020 Business Combinations Activity

During the nine months ended September 30, 2020 , we made no adjustments to our preliminary allocation of the purchase consideration for certain acquisitions completed in 2019.

As of September 30, 2020 , we have completed our analysis to assign fair values to all the identifiable intangible and tangible assets acquired for our 2019 acquisitions.

During the year ended December 31, 2020 we completed no new acquisitions.

Earn-Out Payments

($ in millions)

September 30, 2020

December 31, 2019

($ in millions) March 31, 2021 December 31, 2020

Number of acquisitions with earn-out payments subject to the achievement of certain performance criteria 24 35

6 unchanged sentences

Goodwill and Other Intangible Assets

Goodwill and unamortized intangibles as of September 30, 2020 consisted of:

Goodwill and unamortized intangibles as of March 31, 2021 consisted of:

(1) goodwill of $ 4,201.7 million, (2) identifiable intangibles of $ 634.9 million amortized over their remaining finite useful lives, and (3) $ 52.1 million of identifiable intangibles with indefinite useful lives that are not amortized.

1 unchanged sentence

dollar, which means a portion of the movements in the reported book value of these balances is attributable to movements in foreign currency exchange rates.

During the three months ended September 30, 2020, as part of our annual impairment test of goodwill, we have considered qualitative and quantitative factors and determined it is not more-likely-than-not that the fair value of our Americas, Asia Pacific, and LaSalle reporting units are less than their carrying values.

With respect to our EMEA reporting unit reporting, we performed step 1 of the goodwill impairment analysis which indicated the estimated fair value exceeded the carrying value by over 20%.

In performing step 1, we relied on the discounted cash flow (“DCF”) method, an income approach, in determining the estimated fair value.

Our DCF analysis relied on significant judgments and assumptions in determining the inputs, specifically, forecasted revenue growth, forecasted profitability margin, and the discount rate used to present value the estimated future cash flows.

The following tables detail, by reporting segment, movements in goodwill.

Real Estate Services

(in millions)

(in millions) Americas EMEA Asia Pacific LaSalle Consolidated

Balance as of December 31, 2020 $ 2,878.0 959.7 329.2 57.8 $ 4,224.7

Dispositions ( 11.0 ) ( 0.7 ) — — ( 11.7 )

Impact of exchange rate movements 0.3 ( 8.6 ) ( 3.0 ) — ( 11.3 )

Balance as of September 30, 2020

Balance as of March 31, 2021 $ 2,867.3 950.4 326.2 57.8 $ 4,201.7

Real Estate Services

(in millions)

(in millions) Americas EMEA Asia Pacific LaSalle Consolidated

Balance as of December 31, 2019 $ 2,877.6 915.9 317.6 57.1 $ 4,168.2

Additions, net of adjustments

Impact of exchange rate movements ( 2.9 ) ( 46.6 ) ( 13.4 ) ( 1.0 ) ( 63.9 )

Balance as of September 30, 2019

Balance as of March 31, 2020 $ 2,874.7 869.3 304.2 56.1 $ 4,104.3

The following tables detail, by reporting segment, movements in the gross carrying amount and accumulated amortization of our identifiable intangibles.

Other Intangibles

(in millions)

MSRs Other Intangibles

(in millions) Americas Americas EMEA Asia Pacific LaSalle Consolidated

Gross Carrying Amount

1 unchanged sentence

Additions, net of adjustments (1)

40.0 — 3.8 — — 43.8

Adjustment for fully amortized intangibles ( 6.7 ) ( 7.9 ) ( 0.9 ) ( 2.2 ) — ( 17.7 )

Impact of exchange rate movements — 0.1 0.2 ( 0.4 ) ( 1.8 ) ( 1.9 )

Balance as of September 30, 2020

Balance as of March 31, 2021 $ 605.4 258.0 58.8 21.0 56.1 $ 999.3

Accumulated Amortization

1 unchanged sentence

Amortization, net (2)

( 21.6 ) ( 10.5 ) ( 1.8 ) ( 0.3 ) ( 0.4 ) ( 34.6 )

Adjustment for fully amortized intangibles 6.7 7.9 0.9 2.2 — 17.7

Impact of exchange rate movements — — ( 0.1 ) 0.1 ( 0.1 ) ( 0.1 )

Balance as of September 30, 2020

Net book value as of September 30, 2020

(1) Included in this amount for MSRs was (i) $ 15.3 million relating to prepayments/write-offs due to prepayments of the underlying obligation for which we assumed, acquired or retained the servicing rights and (ii) $ 1.9 million relating to a net impairment valuation allowance.

Balance as of March 31, 2021 $ ( 162.7 ) ( 96.7 ) ( 40.5 ) ( 6.6 ) ( 5.8 ) $ ( 312.3 )

Net book value as of March 31, 2021 $ 442.7 161.3 18.3 14.4 50.3 $ 687.0

(1) Included in this amount for MSRs was (i) $ 3.1 million relating to prepayments/write-offs due to prepayments of the underlying obligation for which we assumed, acquired or retained the servicing rights.

(2) Amortization of MSRs is included in Revenue before reimbursements within the Condensed Consolidated Statements of Comprehensive Income.

Other Intangibles

(in millions)

MSRs Other Intangibles

(in millions) Americas Americas EMEA Asia Pacific LaSalle Consolidated

Gross Carrying Amount

1 unchanged sentence

Additions, net of adjustments (1)

16.9 — — 0.5 — 17.4

Adjustment for fully amortized intangibles ( 12.7 ) — ( 0.2 ) — — ( 12.9 )

Impact of exchange rate movements — ( 0.5 ) ( 3.4 ) ( 2.1 ) ( 1.1 ) ( 7.1 )

Balance as of September 30, 2019

Balance as of March 31, 2020 $ 484.6 285.2 52.3 19.8 52.9 $ 894.8

Accumulated Amortization

1 unchanged sentence

Amortization, net (2)

( 22.6 ) ( 11.6 ) ( 1.8 ) ( 0.4 ) ( 0.7 ) ( 37.1 )

Adjustment for fully amortized intangibles 12.7 — 0.2 — — 12.9

Impact of exchange rate movements — 0.2 2.1 0.5 0.1 2.9

Balance as of September 30, 2019

Net book value as of September 30, 2019

Balance as of March 31, 2020 $ ( 113.9 ) ( 79.7 ) ( 32.6 ) ( 6.6 ) ( 3.3 ) $ ( 236.1 )

Net book value as of March 31, 2020 $ 370.7 205.5 19.7 13.2 49.6 $ 658.7

(1) Included in this amount for MSRs was $ 5.9 million relating to prepayments/write-offs due to prepayments of the underlying obligation for which we assumed, acquired or retained the servicing rights.

(2) Amortization of MSRs is included in Revenue before reimbursements within the Condensed Consolidated Statements of Comprehensive Income .

The remaining estimated future amortization expense of MSRs and other identifiable intangible assets, by year, as of September 30, 2020 , is presented in the following table.

(in millions)

Other Intangibles

2020 (remaining 3 months)

INVESTMENTS IN REAL ESTATE VENTURES

As of September 30, 2020 and December 31, 2019 , we had Investments in real estate ventures of $ 389.6 million and $ 404.2 million , respectively.

Approximately 90% of our investments, as of September 30, 2020 , are primarily (i) direct investments in 48 separate property or commingled funds, where we co-invest alongside our clients and for which we also have an advisory agreement and (ii) investments by JLL Spark in property-technology funds and early-stage companies.

The remaining 10% of our Investments in real estate ventures, as of September 30, 2020 , were attributable to investment vehicles that use our capital and outside capital primarily provided by institutional investors to invest, primarily, in certain real estate ventures that own and operate real estate.

As of March 31, 2021 and December 31, 2020, we had Investments in real estate ventures of $ 545.1 million and $ 430.8 million, respectively.

Approximately 90% of our investments, as of March 31, 2021, are primarily (i) direct investments in 50 separate property or commingled funds, where we co-invest alongside our clients and for which we also have an advisory agreement and (ii) investments by JLL Technologies in early-stage proptech companies.

The remaining 10% of our Investments in real estate ventures, as of March 31, 2021, were attributable to investment vehicles that use our capital and outside capital primarily provided by institutional investors to invest, generally, in certain real estate ventures that own and operate real estate.

Of our investments attributable to investment vehicles, the majority was invested in LaSalle Investment Company II ("LIC II"), in which we held an effective ownership interest of 48.78 %.

We have maximum potential unfunded commitments to direct investments or investment vehicles of $ 338.8 million as of September 30, 2020 .

We have maximum potential unfunded commitments to direct investments or investment vehicles of $ 309.9 million as of March 31, 2021.

Of this amount, while we remain contractually obligated, we do not expect a call on the $ 60.4 million relating to our investment in LIC II as its fund life terminated in January 2020.

4 unchanged sentences

Summarized financial information for our consolidated VIEs is presented in the following tables.

(in millions)

September 30, 2020

December 31, 2019

(in millions) March 31, 2021 December 31, 2020

Property and equipment, net $ 154.0 117.4

Investments in real estate ventures 9.2 9.0

Other assets 11.2 21.0

Total assets $ 174.4 147.4

Other current liabilities $ 1.8 1.9

3 unchanged sentences

Total liabilities and members' equity $ 174.4 147.4

Three Months Ended September 30,

Nine Months Ended September 30,

Three Months Ended March 31,

(in millions) 2021 2020

Revenue $ 2.6 4.3

Operating and other expenses ( 3.2 ) ( 4.3 )

Net gains on sale of investments (1)

Net income (loss)

(1) $12.2 million of the year-to-date gain is included in Equity earnings;

the remaining $3.1 million is included in Other income.

Net (loss) income $ ( 0.6 ) 12.2

(1) The 2020 gain was included in Equity earnings.

We allocate the members' equity and net income of the consolidated VIEs to the noncontrolling interest holders as Noncontrolling interest on our Condensed Consolidated Balance Sheets and as Net income attributable to noncontrolling interest in our Condensed Consolidated Statements of Comprehensive Income, respectively.

There were no significant other-than-temporary impairment charges on Investments in real estate ventures for the nine months ended September 30, 2020 and 2019 .

There were no significant other-than-temporary impairment charges on Investments in real estate ventures for the three months ended March 31, 2021 and 2020.

We report a majority of our investments in real estate ventures at fair value.

3 unchanged sentences

Fair value investments as of January 1, $ 340.3 328.6

Investments 55.8 28.9

Distributions ( 3.3 ) ( 16.0 )

1 unchanged sentence

Foreign currency translation adjustments, net ( 3.1 ) ( 4.3 )

Fair value investments as of September 30,

Fair value investments as of March 31, $ 435.4 302.0

See Note 8, Fair Value Measurements, for additional discussion of our investments in real estate ventures reported at fair value.

2 unchanged sentences

Restricted stock unit ("RSU") and performance stock unit ("PSU") awards activity is presented in the following tables.

Weighted Average

Contractual Life

Unvested as of June 30, 2020

Unvested as of September 30, 2020

Unvested as of June 30, 2019

Unvested as of September 30, 2019

Weighted Average

(in 000's) PSU Shares

(in 000's) Total Shares

(in 000's) Weighted Average

Fair Value Weighted Average

Contractual Life

Unvested as of December 31, 2020 1,096.2 531.5 1,627.7 $ 137.42 1.69

Unvested as of September 30, 2020

Granted 56.6 — 56.6 145.93

Vested ( 207.5 ) ( 79.0 ) ( 286.5 ) 150.76

Forfeited ( 5.0 ) ( 13.4 ) ( 18.4 ) 149.11

Unvested as of March 31, 2021 940.3 439.1 1,379.4 $ 134.84 1.70

Unvested as of December 31, 2019 1,532.3 286.8 1,819.1 $ 141.51 2.39

Unvested as of September 30, 2019

As of September 30, 2020 , we had $ 84.3 million of unamortized deferred compensation related to unvested RSUs and PSUs, which we anticipate recognizing over varying periods into 2024 ;

Granted 9.7 — 9.7 160.03

Vested ( 324.6 ) — ( 324.6 ) 136.91

Forfeited ( 8.5 ) — ( 8.5 ) 137.68

Unvested as of March 31, 2020 1,208.9 286.8 1,495.7 $ 144.71 1.78

As of March 31, 2021, we had $ 74.2 million of unamortized deferred compensation related to unvested RSUs and PSUs, which we anticipate recognizing over varying periods into 2026;

$ 24.1 million relates to the awards issued in conjunction with the HFF acquisition.

9 unchanged sentences

The carrying values of our Credit facility and Short-term borrowings approximate their estimated fair values given the variable interest rate terms and market spreads.

We estimated the fair value of our Long-term debt as $ 686.1 million and $ 685.9 million as of September 30, 2020 and December 31, 2019 , respectively, using dealer quotes that are Level 2 inputs in the fair value hierarchy.

The carrying value of our Long-term debt was $ 682.9 million and $ 664.6 million as of September 30, 2020 and December 31, 2019 , respectively, and included debt issuance costs of $ 2.7 million and $ 3.1 million , respectively.

We estimated the fair value of our Long-term debt as $ 704.8 million and $ 723.7 million as of March 31, 2021 and December 31, 2020, respectively, using dealer quotes that are Level 2 inputs in the fair value hierarchy.

The carrying value of our Long-term debt was $ 684.0 million and $ 702.0 million as of March 31, 2021 and December 31, 2020, respectively, and included debt issuance costs of $ 2.3 million and $ 2.5 million, respectively.

Investments in Real Estate Ventures at Fair Value - Net Asset Value ("NAV")

3 unchanged sentences

Critical inputs to NAV estimates included valuations of the underlying real estate assets and borrowings, which incorporate investment-specific assumptions such as discount rates, capitalization rates, rental and expense growth rates, and asset-specific market borrowing rates.

As of September 30, 2020 and December 31, 2019 , investments in real estate ventures at fair value using NAV were $ 192.4 million and $ 224.8 million , respectively.

In instances where the reported NAV per share did not fully incorporate the COVID-19 pandemic’s impact on the fair value of underlying investments, we recognized an adjustment to decrease the reported NAV.

As of March 31, 2021, such adjustments totaled $9.3 million.

We did not consider any other adjustments to NAV estimates provided by investees, including adjustments for any restrictions to the transferability of ownership interests embedded within investment agreements to which we are a party, to be necessary based upon (i) our understanding of the methodology utilized and inputs incorporated to estimate NAV at the investee level, (ii) consideration of market demand for the specific types of real estate assets held by each venture and (iii) contemplation of real estate and capital markets conditions in the localities in which these ventures operate.

As of March 31, 2021 and December 31, 2020, investments in real estate ventures at fair value using NAV were $ 222.7 million and $ 203.8 million, respectively.

As these investments are not required to be classified in the fair value hierarchy, they have been excluded from the following table.

1 unchanged sentence

The following table categorizes by level in the fair value hierarchy the estimated fair value of our assets and liabilities measured at fair value on a recurring basis.

September 30, 2020

December 31, 2019

(in millions)

March 31, 2021 December 31, 2020

(in millions) Level 1 Level 2 Level 3 Level 1 Level 2 Level 3

Investments in real estate ventures - fair value $ 72.6 — 140.1 77.2 — 59.3

14 unchanged sentences

Investments classified as Level 3 in the fair value hierarchy represent investments in early-stage non-public entities where we elected the fair value option.

The carrying value was deemed to approximate fair value for the majority of these investments due to the proximity of the investment date to the balance sheet date as well as consideration of investee-level performance updates.

The carrying value was deemed to approximate fair value for the majority of these investments due to the proximity of the investment date or date of most recent financing raise to the balance sheet date as well as consideration of investee-level performance updates.

To the extent there are changes in fair value, a result of pricing in subsequent funding rounds or changes in business strategy, for example, we recognize such changes through Equity earnings.

3 unchanged sentences

The inputs for these valuations are Level 2 inputs in the fair value hierarchy.

As of September 30, 2020 and December 31, 2019 , these contracts had a gross notional value of $ 2.03 billion ( $ 1.05 billion on a net basis) and $ 2.30 billion ( $ 1.05 billion on a net basis), respectively.

We recognize gains and losses from revaluation of these contracts as a component of Operating, administrative and other expense.

They are offset by the gains and losses we recognize on the revaluation of intercompany loans and other foreign currency balances.

The impact to net income was not significant for the nine months ended September 30, 2020 or 2019 .

As of March 31, 2021 and December 31, 2020, these contracts had a gross notional value of $ 2.22 billion ($ 1.22 billion on a net basis) and $ 2.34 billion ($ 1.42 billion on a net basis), respectively.

We record the asset and liability positions for our foreign currency forward contracts based on the net payable or net receivable position with the financial institutions from which we purchase these contracts.

The $ 3.2 million asset as of September 30, 2020 , was composed of gross contracts with receivable positions of $ 3.4 million and payable positions of $ 0.2 million .

The $ 10.5 million liability as of September 30, 2020 , was composed of gross contracts with receivable positions of $ 1.9 million and payable positions of $ 12.4 million .

The $ 6.9 million asset as of March 31, 2021, was composed of gross contracts with receivable positions of $ 8.4 million and payable positions of $ 1.5 million.

The $ 9.4 million liability as of March 31, 2021, was composed of gross contracts with receivable positions of $ 0.7 million and payable positions of $ 10.1 million.

As of December 31, 2020, the $ 13.1 million asset was composed of gross contracts with receivable positions of $ 13.5 million and payable positions of $ 0.4 million.

1 unchanged sentence

Warehouse Receivables

As of September 30, 2020 and December 31, 2019 , all of our Warehouse receivables were under commitment to be purchased by government-sponsored enterprises ("GSEs") or by a qualifying investor as part of a U.S.

As of March 31, 2021 and December 31, 2020, all of our Warehouse receivables were under commitment to be purchased by government-sponsored enterprises ("GSEs") or by a qualifying investor as part of a U.S.

government or GSE mortgage-backed security program.

2 unchanged sentences

employees that allows them to defer portions of their compensation.

We recorded this plan on our Condensed Consolidated Balance Sheet as of September 30, 2020 , as Deferred compensation plan assets of $ 410.7 million , long-term deferred compensation plan liabilities of $ 388.4 million , included in Deferred compensation, and as a reduction of equity, Shares held in trust, of $ 5.6 million .

We recorded this plan on our Condensed Consolidated Balance Sheet as of March 31, 2021, as Deferred compensation plan assets of $ 480.2 million, long-term deferred compensation plan liabilities of $ 452.0 million, included in Deferred compensation, and as a reduction of equity, Shares held in trust, of $ 5.4 million.

We recorded this plan on our Condensed Consolidated Balance Sheet as of December 31, 2020, as Deferred compensation plan assets of $ 446.3 million, long-term deferred compensation plan liabilities of $ 427.6 million, included in Deferred compensation, and as a reduction of equity, Shares held in trust, of $ 5.6 million.

6 unchanged sentences

The tables below present a reconciliation for assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3).

Balance as of June 30, 2020

Net change in fair value

Foreign CTA 1

Purchases / Additions

Balance as of September 30, 2020

Investments in real estate ventures

Mortgage banking derivative assets and liabilities, net

Earn-out liabilities

Balance as of June 30, 2019

Net change in fair value

Foreign CTA 1

Purchases / Additions

Balance as of September 30, 2019

Investments in real estate ventures

Mortgage banking derivative assets and liabilities, net

Earn-out liabilities

(in millions)

Balance as of December 31, 2019

Net change in fair value

Foreign CTA 1

Purchases / Additions

Balance as of September 30, 2020

(in millions) Balance as of December 31, 2020 Net change in fair value Foreign CTA (1)

Purchases / Additions Settlements Balance as of March 31, 2021

Investments in real estate ventures $ 59.3 31.8 — 49.1 ( 0.1 ) $ 140.1

1 unchanged sentence

Earn-out liabilities 85.7 ( 0.1 ) ( 0.4 ) 3.8 ( 20.8 ) 68.2

(in millions)

Balance as of December 31, 2018

Net change in fair value

Foreign CTA 1

Purchases / Additions

Balance as of June 30, 2019

(in millions) Balance as of December 31, 2019 Net change in fair value Foreign CTA (1)

Purchases / Additions Settlements Balance as of

March 31, 2020

Investments in real estate ventures $ 34.4 — — 7.0 — $ 41.4

3 unchanged sentences

Net change in fair value, included in the tables above, is reported in Net income as follows.

Category of Assets/Liabilities using Unobservable Inputs

Condensed Consolidated Statements

Category of Assets/Liabilities using Unobservable Inputs Condensed Consolidated Statements

of Comprehensive Income Account Caption

Earn-out liabilities (Short-term and Long-term)

Restructuring and acquisition charges

Investments in real estate ventures

Equity earnings

Other current assets - Mortgage banking derivative assets

Revenue before reimbursements

Other current liabilities - Mortgage banking derivative liabilities

Revenue before reimbursements

Earn-out liabilities (Short-term and Long-term) Restructuring and acquisition charges

Investments in real estate ventures Equity earnings

Other current assets - Mortgage banking derivative assets Revenue before reimbursements

Other current liabilities - Mortgage banking derivative liabilities Revenue before reimbursements

Non-Recurring Fair Value Measurements

2 unchanged sentences

Our determination of fair value primarily relies on Level 3 inputs.

We did not recognize any significant investment-level impairment losses during either of the three or nine months ended September 30, 2020 or 2019 .

We did not recognize any significant investment-level impairment losses during either of the three months ended March 31, 2021 or 2020.

See Note 6, Investments in Real Estate Ventures, for additional information, including information related to impairment charges recorded at the investee level.

Short-term borrowings and long-term debt obligations are composed of the following.

(in millions)

September 30, 2020

December 31, 2019

($ in millions) March 31, 2021 December 31, 2020

Short-term borrowings:

3 unchanged sentences

Credit facility, net of debt issuance costs of $ 7.7 and $ 8.7

342.3 ( 8.7 )

Long-term senior notes, 4.4 %, face amount of $ 275.0 , due November 2022, net of debt issuance costs of $ 0.6 and $ 0.8

1 unchanged sentence

Long-term senior notes, 2.21 %, face amount of € 175.0 , due June 2029, net of debt issuance costs of $ 0.9 and $ 0.9

Total debt $ 1,116.9 755.3

Credit Facility

We have a $ 2.75 billion unsecured revolving credit facility (the "Facility") that matures on May 17, 2023 .

Pricing on the Facility ranges from LIBOR plus 0.875% to 1.35% , with pricing as of September 30, 2020 , at LIBOR plus 0.95 % .

In addition to outstanding borrowings under the Facility presented in the above table, we had outstanding letters of credit under the Facility of $ 0.7 million and $ 0.8 million as of September 30, 2020 and December 31, 2019 , respectively.

Our $ 2.75 billion unsecured revolving credit facility (the "Facility") matures on May 17, 2023.

Pricing on the Facility ranges from three-month LIBOR plus 0.875% to 1.35% , with pricing as of March 31, 2021, at LIBOR plus 0.95 %.

In addition to outstanding borrowings under the Facility presented in the above table, we had outstanding letters of credit under the Facility of $ 0.7 million as of both March 31, 2021 and December 31, 2020.

On April 14, 2021, we renewed the Facility, which included the extension of the maturity date to April 2026.

Refer to Note 13, Subsequent Events for further detail.

The following tables provides additional information on our Facility.

Three Months Ended September 30,

Nine Months Ended

September 30,

Three Months Ended March 31,

($ in millions) 2021 2020

1 unchanged sentence

Effective interest rate on the Facility 1.0 % 2.4 %

We will continue to use the Facility for, but not limited to, business acquisitions, working capital needs (including payment of accrued incentive compensation), co-investment activities, dividend payments, share repurchases and capital expenditures.

Short-Term Borrowings and Long-Term Debt

1 unchanged sentence

Amounts outstanding are presented in the debt table above.

As of September 30, 2020 , our issuer and senior unsecured ratings are investment grade:

As of March 31, 2021, our issuer and senior unsecured ratings are investment grade:

Baa1 from Moody’s Investors Service, Inc.

1 unchanged sentence

Our Facility and senior notes are subject to customary financial and other covenants, including cash interest coverage ratios and leverage ratios, as well as event of default conditions.

We remained in compliance with all covenants as of September 30, 2020 .

We remained in compliance with all covenants as of March 31, 2021.

Warehouse Facilities

September 30, 2020

December 31, 2019

($ in millions)

Outstanding Balance

Maximum Capacity

Outstanding Balance

Maximum Capacity

March 31, 2021 December 31, 2020

($ in millions) Outstanding Balance Maximum Capacity Outstanding Balance Maximum Capacity

Warehouse Facilities:

LIBOR plus 1.15%, October 21, 2020 1

LIBOR plus 1.40% , expires September 20, 2021

$ 171.5 400.0 144.4 400.0

LIBOR plus 1.40% , expires September 18, 2021 (1)

516.6 1,200.0 768.9 1,600.0

LIBOR plus 1.40% , expires August 27, 2021 (2)

87.3 200.0 195.9 900.0

Fannie Mae ASAP (3) program, LIBOR plus 1.15%

LIBOR plus 1.25% 5

58.9 n/a 128.8 n/a

LIBOR plus 1.50%

— 300.0 261.6 300.0

Gross warehouse facilities 834.3 2,100.0 1,499.6 3,200.0

Debt issuance costs

Debt issuance costs ( 0.8 ) n/a ( 1.2 ) n/a

Total warehouse facilities $ 833.5 2,100.0 1,498.4 3,200.0

1 In the third quarter of 2020, JLL extended the Warehouse facility;

previously, the facility had a maturity date of September 21, 2020.

In October 2020, JLL extended the Warehouse facility to September 20, 2021 with a maximum capacity of $400 million and an increase to the interest rate (to LIBOR plus 1.40%).

2 In the third quarter of 2020, JLL extended the Warehouse facility with an increase to the interest rate;

previously, the facility had a maturity date of September 19, 2020 and an interest rate of LIBOR plus 1.15%.

3 In the third quarter of 2020, JLL extended the Warehouse facility with an increase to the interest rate;

previously, the facility had a maturity date of August 31, 2020 and an interest rate of LIBOR plus 1.15%.

(1) The temporary maximum capacity increase to $1,600.0 million expired on January 31, 2021;

thereafter, the maximum capacity reverted to its original contractual amount.

(2) The temporary maximum capacity increase to $900.0 million expired on January 6, 2021;

thereafter, the maximum capacity reverted to its original contractual amount.

(3) As Soon As Pooled ("ASAP") funding program.

5 In the third quarter of 2020, the maximum capacity was reduced from $1.0 billion to $500 million.

We have lines of credit established for the sole purpose of funding our Warehouse receivables.

These lines of credit exist with financial institutions and are secured by the related warehouse receivables.

Pursuant to these warehouse facilities, we are required to comply with certain financial covenants regarding (1) minimum net worth, (2) minimum servicing-related loans, and (3) minimum adjusted leverage ratios.

We remained in compliance with all covenants under our Warehouse facilities as of September 30, 2020 .

Pursuant to these warehouse facilities, we are required to comply with certain financial covenants regarding (i) minimum net worth, (ii) minimum servicing-related loans and (iii) minimum adjusted leverage ratios.

We remained in compliance with all covenants under our Warehouse facilities as of March 31, 2021.

COMMITMENTS AND CONTINGENCIES

We are a defendant in various litigation matters arising in the ordinary course of business, some of which involve claims for damages that are substantial in amount.

Professional Indemnity Insurance

When a potential loss event occurs, we estimate the ultimate cost of the claim and accrue the amount in Other current and long-term liabilities on our Condensed Consolidated Balance Sheets when probable and estimable.

In addition, we have established receivables from third-party insurance providers for claim amounts in excess of the risk retained by our captive insurance company.

In total, these receivables were $ 41.0 million and $ 37.7 million as of September 30, 2020 and December 31, 2019 , respectively, and are included in Notes and other receivables and Long-term receivables on our Condensed Consolidated Balance Sheets.

In total, these receivables were $ 14.5 million and $ 44.0 million as of March 31, 2021 and December 31, 2020, respectively, and are included in Notes and other receivables and Long-term receivables on our Condensed Consolidated Balance Sheets.

The following table shows the professional indemnity accrual activity and related payments.

2 unchanged sentences

Prior year claims adjustments (including foreign currency changes) ( 30.2 )

September 30, 2020

Claims paid ( 0.4 )

March 31, 2021 $ 17.6

December 31, 2019 $ 38.1

New claims 0.3

Prior year claims adjustments (including foreign currency changes) ( 4.8 )

September 30, 2019

Claims paid —

March 31, 2020 $ 33.6

DUS Program Loan Loss-Sharing

As a participant in the DUS program, we retain a portion of the risk of loss for loans that are originated and sold under the DUS program.

1 unchanged sentence

Generally, we share approximately one-third of incurred losses, subject to a cap of 20% of the principal balance of the mortgage at origination.

As of September 30, 2020 and December 31, 2019 , we had loans subject to such loss-sharing arrangements with an aggregate unpaid principal balance of $ 11.0 billion and $ 9.7 billion , respectively.

As of March 31, 2021 and December 31, 2020, we had loans subject to such loss-sharing arrangements with an aggregate unpaid principal balance of $ 12.9 billion and $ 12.2 billion, respectively.

For all DUS program loans with loss-sharing obligations, we record a non-contingent liability equal to the estimated fair value of the guarantee obligations undertaken upon sale of the loan, which reduces our gain on sale of the loan.

Subsequently, this liability is amortized over the estimated life of the loan and recognized as Revenue on the Condensed Consolidated Statements of Comprehensive Income.

As of September 30, 2020 and December 31, 2019 , the loss-sharing guarantee obligations were $ 20.7 million and $ 20.6 million , respectively, and are included in Other liabilities on our Condensed Consolidated Balance Sheets.

There were no loan losses incurred for the three and nine months ended September 30, 2020 and 2019 .

As of March 31, 2021 and December 31, 2020, the loss-sharing guarantee obligations were $ 23.5 million and $ 22.1 million, respectively, and are included in Other liabilities on our Condensed Consolidated Balance Sheets.

There were no loan losses incurred for the three months ended March 31, 2021 and 2020.

The loss-sharing aspect of the program represents an off-balance sheet credit exposure.

We record a separate contingent reserve for this risk calculated on an individual loan level.

As of March 31, 2021 and December 31, 2020, the loan loss guarantee reserve was $28.6 million and $36.7 million, respectively, and are included within Other liabilities on our Condensed Consolidated Balance Sheets.

RESTRUCTURING AND ACQUISITION CHARGES

3 unchanged sentences

Restructuring and acquisition charges are presented in table below.

Three Months Ended September 30,

Nine Months Ended September 30,

Three Months Ended March 31,

(in millions) 2021 2020

5 unchanged sentences

The following tables show the accrual activity and payments relating to cash-based Restructuring and acquisition charges.

(in millions)

Severance & Employment-Related

Restructuring, Acquisition and

Integration Costs

(in millions) Severance & Employment-Related Lease

Exit Restructuring, Acquisition and

Integration Costs Total

December 31, 2020 $ 41.3 2.5 1.2 $ 45.0

Accruals 1.8 3.3 6.2 11.3

Payments made ( 18.9 ) ( 4.8 ) ( 5.6 ) ( 29.3 )

September 30, 2020

(in millions)

Severance & Employment-Related

Other Restructuring,

Acquisition and Integration Costs

March 31, 2021 $ 24.2 1.0 1.8 $ 27.0

(in millions) Severance & Employment-Related Lease

Exit Other Restructuring,

Acquisition and Integration Costs Total

December 31, 2019 $ 24.3 8.4 3.8 $ 36.5

Accruals 1.3 2.4 7.4 11.1

Payments made ( 14.3 ) ( 9.6 ) ( 6.9 ) ( 30.8 )

September 30, 2019

We expect the majority of accrued severance and other accrued acquisition costs as of September 30, 2020 will be paid during the next twelve months.

March 31, 2020 $ 11.3 1.2 4.3 $ 16.8

We expect the majority of accrued severance and other accrued acquisition costs as of March 31, 2021 will be paid during the next twelve months.

Lease exit payments depend on the terms of various leases, which extend as far out as 2026.

HFF Acquisition

Included in Restructuring and acquisition charges were $ 13.8 million and $ 55.2 million , respectively, for the three and nine months ended September 30, 2020 compared to $ 60.1 million and $ 69.8 million , respectively, for the three and nine months ended September 30, 2019 of charges relating to the acquisition and integration of HFF (including transaction/deal costs, retention and severance expense, early lease termination costs, and other integration expenses).

Included in Restructuring and acquisition charges were $ 11.5 million for the three months ended March 31, 2021 compared to $ 21.3 million for the three months ended March 31, 2020 of charges relating to the acquisition and integration of HFF (including retention and severance expense, early lease termination costs, and other integration expenses).

During the integration of HFF, we expect to incur significant charges over the two years following the acquisition in an effort to maximize the value of the combined organization.

4 unchanged sentences

The tables below present the changes in Accumulated other comprehensive income (loss) ("AOCI") by component.

For pension and postretirement benefits, we report amounts reclassified from AOCI relating to employer service cost in Compensation and benefits within the Condensed Consolidated Statements of Comprehensive Income.

All other reclassifications relating to pension and postretirement benefits are reported within Other income.

(in millions)

Pension and postretirement benefit

Cumulative foreign currency translation adjustment

Balance as of June 30, 2020

Other comprehensive income before reclassification

Amounts reclassified from AOCI after tax expense of

$ - , $ - and $ -

Other comprehensive income after tax expense of $ - , $ - and $ -

Balance as of September 30, 2020

(in millions)

Pension and postretirement benefit

Cumulative foreign currency translation adjustment

Balance as of June 30, 2019

(in millions) Pension and postretirement benefit Cumulative foreign currency translation adjustment Total

Balance as of December 31, 2020 $ ( 81.2 ) ( 296.0 ) $ ( 377.2 )

Other comprehensive loss before reclassification — ( 6.2 ) ( 6.2 )

2 unchanged sentences

Other comprehensive loss after tax expense of $ - , $ - and $ - ( 0.2 ) ( 6.2 ) ( 6.4 )

Balance as of September 30, 2019

(in millions)

Pension and postretirement benefit

Cumulative foreign currency translation adjustment

Balance as of March 31, 2021 $ ( 81.4 ) ( 302.2 ) $ ( 383.6 )

(in millions) Pension and postretirement benefit Cumulative foreign currency translation adjustment Total

Balance as of December 31, 2019 $ ( 72.0 ) ( 355.8 ) $ ( 427.8 )

3 unchanged sentences

Other comprehensive loss after tax expense of $ - , $ - and $ - — ( 143.4 ) ( 143.4 )

Balance as of September 30, 2020

(in millions)

Pension and postretirement benefit

Cumulative foreign currency translation adjustment

Balance as of December 31, 2018

Other comprehensive income before reclassification

Amounts reclassified from AOCI after tax expense of

$ - , $ - and $ -

Other comprehensive (loss) income after tax expense of $ - , $ - and $ -

Balance as of September 30, 2019

Balance as of March 31, 2020 $ ( 72.0 ) ( 499.2 ) $ ( 571.2 )

All other reclassifications relating to pension and postretirement benefits are reported within Other income.

SUBSEQUENT EVENTS

On April 14, 2021, we executed Amendment No.

2 ("Amendment No.

2") to the Second Amended and Restated Multicurrency Credit Agreement dated as of June 21, 2016 (as amended, the "Credit Agreement") with a syndicate of lenders.

The borrowing capacity under the Credit Agreement remains at $ 2.75 billion.

The features to the Credit Agreement, as amended, provide for (i) an extension of the maturity date from May 2023 to April 2026, (ii) incremental flexibility of cash add-backs, all capped at the greater of $175.0 million or 20% of Bank Adjusted EBITDA for any twelve-month period, (iii) incorporating non-cash add-backs to Bank Adjusted EBITDA, (iv) certain sustainability-linked metrics incorporating KPI's with incentive pricing, and (v) auto-adjustment to new benchmark interest rates.

Refer to Note 9, Debt for further information on our Facility.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements