What changed in this filing

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Item 1. Financial Statements

2022-05-09 compared with 2021-11-03 · 270 added, 320 removed, 440 unchanged (57% of the section changed)

2 unchanged sentences

CONDENSED CONSOLIDATED BALANCE SHEETS

(in millions, except share and per share data) September 30, 2021 December 31, 2020

(in millions, except share and per share data) March 31, 2022 December 31, 2021

Assets (unaudited)

7 unchanged sentences

Short-term contract assets, net of allowance of $ 2.3 and $ 2.5

Prepaid & other 478.1 517.1

Prepaid and other 566.7 500.7

Total current assets 6,165.4 6,387.7

3 unchanged sentences

Identified intangibles, net of accumulated amortization of $ 367.8 and $ 340.1

Investments in real estate ventures, including $ 537.7 and $ 340.3 at fair value

Investments, including $ 677.5 and $ 639.6 at fair value

Long-term receivables 327.5 316.4

7 unchanged sentences

Reimbursable payables 1,219.2 1,350.0

Accrued compensation & benefits 1,494.2 1,433.2

Accrued compensation and benefits 1,333.5 2,029.5

Short-term borrowings 118.2 147.9

Current maturities of long-term debt, net of debt issuance costs of $ 0.3 and $ 0.3

Short-term contract liabilities and deferred income 211.3 208.2

31 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,

2021 2020 2021 2020

Revenue before reimbursements $ 2,804.9 2,091.4 $ 7,442.0 6,152.9

Reimbursements 2,084.3 1,886.7 5,979.3 5,591.6

Total revenue $ 4,889.2 3,978.1 $ 13,421.3 11,744.5

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

Revenue $ 4,801.4 4,037.1

Operating expenses:

1 unchanged sentence

Operating, administrative and other 2,141.0 1,897.2

Reimbursed expenses 2,084.3 1,886.7 5,979.3 5,591.6

Depreciation and amortization 54.4 53.0

8 unchanged sentences

Net income 143.9 102.4

Net (loss) income attributable to noncontrolling interest ( 0.5 ) 2.7 ( 1.7 ) 14.1

Net loss attributable to noncontrolling interest ( 1.7 ) ( 0.6 )

Net income attributable to common shareholders $ 145.6 103.0

10 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2021 AND 2020

FOR THE THREE MONTHS ENDED MARCH 31, 2022 AND 2021

Company Shareholders' Equity

1 unchanged sentence

(in millions, except share and

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

Shares Amount Capital Earnings Trust Stock AOCI (1)

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

Capital Earnings Trust Stock AOCI (1)

December 31, 2021 50,024,139 $ 0.5 2,053.7 4,937.6 ( 5.2 ) ( 406.3 ) ( 395.4 ) 228.5 $ 6,413.4

4 unchanged sentences

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

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

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

Decrease in amounts attributable to noncontrolling interest — — — — — — — ( 1.9 ) ( 1.9 )

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 (loss) — — — 200.0 — — — ( 0.6 ) 199.4

Shares issued under stock-based compensation programs 13,712 — ( 1.0 ) — — 1.5 — — 0.5

Shares repurchased for payment of taxes on stock-based compensation ( 2,184 ) — ( 0.2 ) — — ( 0.2 ) — — ( 0.4 )

Amortization of stock-based compensation — — 26.3 — — — — — 26.3

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

Change in pension liabilities, net of tax — — — — — 0.7 — 0.7

Repurchase of common stock ( 615,351 ) — — — — ( 150.0 ) — — ( 150.0 )

1 unchanged sentence

Increase in amounts attributable to noncontrolling interest — — — — — — — 15.2 15.2

June 30, 2021 51,145,228 $ 0.5 2,040.6 4,278.9 ( 5.3 ) ( 122.3 ) ( 383.1 ) 90.4 $ 5,899.7

Net income (loss) — — — 237.2 — — — ( 0.5 ) 236.7

Shares issued under stock-based compensation programs 200,425 — ( 14.8 ) — — 25.5 — — 10.7

Shares repurchased for payment of taxes on stock-based compensation ( 82,956 ) — ( 16.1 ) — — ( 10.7 ) — — ( 26.8 )

Amortization of stock-based compensation — — 24.0 — — — — — 24.0

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

Repurchase of common stock ( 680,500 ) — — — — ( 151.6 ) — — ( 151.6 )

Foreign currency translation adjustments — — — — — — ( 47.2 ) — ( 47.2 )

Increase in amounts attributable to noncontrolling interest — — — — — — — 6.5 6.5

September 30, 2021 50,582,197 $ 0.5 2,033.7 4,516.1 ( 5.2 ) ( 259.1 ) ( 430.3 ) 96.4 $ 5,952.1

Accumulated other comprehensive income (loss)

Noncontrolling interest

JONES LANG LASALLE INCORPORATED

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (CONTINUED)

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2021 AND 2020

March 31, 2022 49,608,928 $ 0.5 2,066.8 5,083.2 ( 5.1 ) ( 552.7 ) ( 419.5 ) 242.0 $ 6,415.2

Company Shareholder's Equity

1 unchanged sentence

(in millions, except share and

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

Shares Amount Capital Earnings Trust Stock AOCI (1)

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

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 — — — 5.3 — — — 12.3 17.6

Shares issued under stock-based compensation programs 363,308 — 4.4 — — — — — 4.4

Shares repurchased for payment of taxes on stock-based compensation ( 102,370 ) — ( 16.2 ) — — — — — ( 16.2 )

Amortization of stock-based compensation — — 18.6 — — — — — 18.6

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 )

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

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

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

Net income (loss)

4 unchanged sentences

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

Foreign currency translation adjustments — — — — — — 33.8 — 33.8

Increase in amounts attributable to noncontrolling interest — — — — — — — 2.3 2.3

Balances at June 30, 2020 51,642,055 $ 0.5 1,999.3 3,593.9 ( 5.7 ) ( 24.4 ) ( 537.4 ) 83.2 $ 5,109.4

Net income (3)

— — — 131.9 — — — 2.9 134.8

Shares issued under stock-based compensation programs 221,527 — ( 1.2 ) 0.1 — 1.6 — — 0.5

Shares repurchased for payment of taxes on stock-based compensation ( 66,315 ) — ( 6.3 ) — — — — — ( 6.3 )

Amortization of stock-based compensation — — 16.3 — — — — — 16.3

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

Repurchase of common stock ( 258,131 ) — — — — ( 25.0 ) — — ( 25.0 )

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

1 unchanged sentence

Decrease in amounts attributable to noncontrolling interest — — — — — — — ( 1.9 ) ( 1.9 )

Balances at September 30, 2020 51,539,136 $ 0.5 2,008.1 3,725.9 ( 5.6 ) ( 47.8 ) ( 477.4 ) 82.5 $ 5,286.2

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

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.

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) 2022 2021

1 unchanged sentence

Net income $ 143.9 102.4

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

Reconciliation of net income to net cash used in operating activities:

Depreciation and amortization 54.4 53.0

Equity earnings ( 18.5 ) ( 48.5 )

Net (gain) loss on dispositions ( 11.3 ) 1.2

Distributions of earnings from real estate ventures 14.6 10.4

Net loss (gain) on dispositions 0.4 ( 11.4 )

Distributions of earnings from investments 2.6 0.4

Provision for loss on receivables and other assets 5.5 ( 0.5 )

9 unchanged sentences

Accrued compensation ( 710.1 ) ( 384.4 )

Net cash provided by operating activities 210.3 363.1

Net cash used in operating activities ( 716.4 ) ( 461.8 )

Cash flows from investing activities:

2 unchanged sentences

Business acquisitions, net of cash acquired ( 2.0 ) ( 0.2 )

Capital contributions to real estate ventures ( 132.3 ) ( 63.2 )

Distributions of capital from real estate ventures 39.1 30.5

Capital contributions to investments ( 36.5 ) ( 33.8 )

Distributions of capital from investments 5.6 4.0

Other, net ( 2.5 ) 4.0

3 unchanged sentences

Repayments of borrowings under credit facility ( 1,373.0 ) ( 892.0 )

Net proceeds from (repayments of) short-term borrowings 60.4 ( 17.1 )

Net (repayments of) proceeds from short-term borrowings ( 27.4 ) 36.8

Payments of deferred business acquisition obligations and earn-outs ( 6.0 ) ( 21.0 )

1 unchanged sentence

Other, net 14.9 10.9

Net cash provided by (used in) financing activities 39.3 ( 243.8 )

Net cash provided by financing activities 806.5 376.7

Effect of currency exchange rate changes on cash, cash equivalents and restricted cash ( 6.7 ) ( 12.4 )

12 unchanged sentences

Non-cash consideration received for disposition — 23.9

Deferred business acquisition obligations 1.4 —

See accompanying notes to Condensed Consolidated Financial Statements.

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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 2021 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, 2021, and for the periods ended September 30, 2021 and 2020, are unaudited.

Our Condensed Consolidated Financial Statements as of March 31, 2022, and for the periods ended March 31, 2022 and 2021, 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.

We have also reclassified certain prior year amounts to conform to the current presentation, specifically the incorporation of directly reimbursed expenses within Compensation and benefits, and Operating, administrative and other on our Condensed Consolidated Statements of Comprehensive Income, compared with its historical separate presentation.

Historically, our quarterly revenue and profits have tended to increase from quarter to quarter as the year progresses.

This is the result of a general focus in the real estate industry on completing transactions by calendar year end, while certain expenses are recognized evenly throughout the year.

Growth in our Property Management and Workplace Management businesses as well as other annuity-based services has, to an extent, lessened the seasonality in our revenue and profits during the past several years.

Within our Markets Advisory and Capital Markets segments, revenue from transaction-based activities is driven by the size and timing of our clients' transactions and can fluctuate significantly from period to period.

Our LaSalle Investment Management ("LaSalle") segment generally earns investment-generated performance fees on clients' real estate investment returns when assets are sold, the timing of which is geared toward the benefit of our clients, as well as co-investment equity gains and losses, primarily dependent on underlying valuations.

Within our Real Estate Services ("RES") segments, revenue from transaction-based activities (e.g.

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

In 2020 and during the nine months ended September 30, 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.

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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 September 30 are not fully indicative of what our results will be for the full fiscal year.

NEW ACCOUNTING STANDARDS

Recently adopted accounting guidance

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.

We adopted this guidance effective January 1, 2021, and the adoption did not impact our financial statements and related disclosures.

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.

Change in Reporting Segments

Effective January 1, 2022, we changed from our geographic-centric Real Estate Services segments of Americas, EMEA and Asia Pacific to global business line segments of Markets Advisory, Capital Markets, Work Dynamics and JLL Technologies.

Our real estate investment management business, LaSalle, continues as a reporting segment.

As our segment financial results are presented on this global business line view, the comparable period has been recast to align with the new reporting structure.

Refer to Note 2, Revenue Recognition, and Note 3, Business Segments, for additional information, including detail financial information, on our segments.

REVENUE RECOGNITION

Revenue excluded from the scope of ASC Topic 606 - Our mortgage banking and servicing operations - such as Mortgage Servicing Rights ("MSR")-related activity, loan origination fees, and servicing income - are excluded from the scope of ASC Topic 606.

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

Three Months Ended September 30, Nine Months Ended September 30,

We earn revenue from the following services (segments are bolded).

• Markets Advisory

◦ Property Management

◦ Advisory, Consulting and Other

• Capital Markets

◦ Investment Sales, Debt/Equity Advisory and Other

◦ Loan Servicing

◦ Valuation Advisory

• Work Dynamics

◦ Workplace Management

◦ Project Management

◦ Portfolio Services and Other

• JLL Technologies

Markets Advisory

Leasing revenue is earned from brokerage commissions as we represent tenants and/or landlords in connection with real estate leases.

Our performance obligation is to facilitate the execution of a lease agreement, which is satisfied at a point in time, upon lease execution.

Generally, we are either entitled to the full consideration upon lease execution or in part upon lease execution with the remainder upon the occurrence of a future event outside of our control (e.g., tenant occupancy, lease commencement, or rent commencement).

The majority of the events that preclude our entitlement to the full consideration upon lease execution are considered to be “normal course of business” and, therefore, do not result in a constraint upon the recognition of revenue.

In the infrequent instance our fee entitlement in a contract with a customer is predicated on the occurrence of a future event(s) uncertain of occurring, we constrain the recognition of revenue until the uncertainty is resolved or the future event occurs.

Generally, less than 5% of our Leasing revenue recognized in a period had previously been constrained.

Property Management

Property Management provides on-site day-to-day real estate management services for owners of office, industrial, retail, multifamily residential and various other types of properties, representing a series of daily performance obligations delivered over time.

Pricing is generally in the form of a monthly management fee based upon property-level cash receipts, square footage under management or some other variable metric.

Although we are principal in limited situations, we generally act as agent on behalf of our Property Management clients in relation to third-party vendors and subcontractors engaged to deliver operational services to our clients' properties.

In these situations, we arrange, but do not control, the services provided by third party vendors and subcontractors prior to the transfer of the services to the client.

As a result, the third-party costs incurred on behalf of clients, along with the corresponding revenue, are presented net on our Condensed Consolidated Statements of Comprehensive Income.

Advisory, Consulting and Other

Advisory, Consulting and Other includes a variety of different service offerings, whereby our performance obligation is to provide services as specified in the contract.

Occasionally, our entitlement to consideration is predicated on the occurrence of an event such as the delivery of a report for which client acceptance is required.

However, except for event-driven point-in-time transactions, the majority of services provided within this service line are delivered over time due to the continuous transfer of control to our clients.

Capital Markets

Investment Sales, Debt/Equity Advisory and Other

We provide brokerage and other services for capital transactions, such as real estate sales or loan originations and refinancing.

Our performance obligation is to facilitate the execution of capital transactions, and we are generally entitled to the full consideration at the point in time upon which our performance obligation is satisfied, at which time we recognize revenue.

In addition, revenue related to mortgage servicing rights ("MSR" or "MSRs") and loan origination fees are reported within Investment Sales, Debt/Equity Advisory and Other.

Loan Servicing

We service substantially all the loans we originate and sell, and service loans we did not originate but subsequently acquire the rights to service.

We obtain a periodic fee for each loan we service based on a proportion of the cash collections.

Capital Markets revenue excluded from the scope of Accounting Standards Codification Topic 606, Revenue from Contracts with Customers ("ASC Topic 606")

Our mortgage banking and servicing operations, comprised of (i) all Loan Servicing revenue and (ii) activities related to MSRs and loan origination fees (included in Investment Sales, Debt/Equity Advisory and Other), are not considered revenue from contracts with customers, and accordingly are excluded from the scope of ASC Topic 606.

Such out-of-scope revenue is presented below.

Three Months Ended March 31,

(in millions) 2022 2021

Revenue excluded from scope of ASC Topic 606 $ 69.9 70.2

Valuation Advisory

Valuation Advisory service offerings include (but are not limited to) asset appraisal, business valuation, property tax advisory, complex litigation, and environmental property consulting.

Our performance obligation is to provide services as specified in the contract and our pricing is negotiated based on the scale and complexity of each assignment.

Typically, our entitlement to consideration is predicated on the occurrence of an event such as the delivery of an appraisal or report for which client acceptance is required.

Work Dynamics

Workplace Management

Workplace Management, previously referred to as Integrated Facilities Management (IFM), provides comprehensive, on-site day-to-day real estate management services to corporations and institutions across a broad range of industries that outsource the management of the real estate they occupy, representing a series of daily performance obligations delivered over time.

Pricing generally includes a management fee and, in many instances, an incentive fee or other form of variable consideration.

Although we may act as agent on behalf of our clients with respect to certain mandates, we generally act as principal for our Workplace Management contracts with respect to third-party vendors and subcontractors engaged to deliver operational services to our clients' facilities.

In these situations, we control the services provided by such third-party vendors and subcontractors prior to the transfer of the services to the client.

As a result, the third-party costs incurred on behalf of our clients, along with the corresponding reimbursement revenue, are presented gross on our Condensed Consolidated Statements of Comprehensive Income.

Project Management

Project Management, previously referred to as Project & Development Services, provides short-term construction-related services ranging from development and design to general contracting and project management for owners and occupiers of real estate.

Depending on the terms of our engagement, our performance obligation is either to arrange for the completion of a project or to assume responsibility for completing a project on behalf of a client.

Our obligations to clients are satisfied over time due to the continuous transfer of control of the underlying asset.

Therefore, we recognize revenue over time, generally using input measures (e.g., to-date costs incurred relative to total estimated costs at completion).

Typically, we are entitled to consideration at distinct milestones over the term of an engagement.

For certain contracts where we assume responsibility for completing a project, we control the services provided by third-party vendors and subcontractors prior to transfer of the assets to the client.

In these situations, the third-party costs incurred on behalf of clients, along with the associated reimbursement revenue, are presented gross on our Condensed Consolidated Statements of Comprehensive Income.

In contrast, where we act as agent on behalf of clients, third-party costs incurred and the associated revenue are presented net on our Condensed Consolidated Statements of Comprehensive Income.

Portfolio Services and Other

Portfolio Services and Other includes a variety of different service offerings, including advising clients on how to optimize their workplace strategies and occupancy planning efforts, and overall portfolio strategy management and administration for our clients.

Our performance obligation is to provide services as specified in the contract.

For event-driven point-in-time transactions, we record revenue when our performance obligation is complete, such as the delivery of a report where client acceptance is required, whereas revenue is recorded over time for services with a continuous transfer of control to our clients.

JLL Technologies

JLL Technologies offers multiple cloud-based software solutions that generate value for investors and businesses by enabling higher-quality decision-making through improved data and analytics.

We recognize cloud-based software revenue over time commensurate with the length and terms of the contract.

In addition, we offer professional services such as program and project management, implementation and support, managed services, and advisory services.

We recognize professional services revenue at the time our performance obligation is satisfied.

LaSalle provides real estate investment management services to clients and generally earns consideration in the form of advisory fees, transaction fees and incentive fees.

Typically, our performance obligation is to manage clients’ capital for a specified period of time and is delivered as a series of daily performance obligations over time.

Revenue recognition for transaction and incentive fees is generally constrained until all contingencies have cleared due to the possibility of a significant reversal until completion of the events necessary to realize the associated consideration.

Substantially all incentive fees recognized as revenue were previously constrained.

Contract assets and liabilities - Our contract assets, net of allowance, are included in Short-term contract assets and Other assets and our contract liabilities are included in Short-term contract liabilities and deferred income on our Condensed Consolidated Balance Sheets.

1 unchanged sentence

Such contract assets and liabilities are presented below.

(in millions) September 30, 2021 December 31, 2020

(in millions) March 31, 2022 December 31, 2021

Contract assets, gross $ 449.5 438.7

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

As of March 31, 2022, 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.

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BUSINESS SEGMENTS

We manage and report our operations as four business segments:

The three geographic regions of RES including:

(1) Americas,

(2) Europe, Middle East and Africa ("EMEA"), and

(3) Asia Pacific;

Each geographic region offers our full range of real estate services, including agency leasing and tenant representation, capital markets, property and facility management, project and development management, energy management and sustainability, construction management, and advisory, consulting and valuation services.

LaSalle provides investment management services on a global basis to institutional investors and high-net-worth individuals.

On February 28, 2022, we announced a new organizational structure that became effective on January 1, 2022.

Under the new structure, we organize our operations around, and publicly report our financial results on, five global business segments:

(1) Markets Advisory,

(2) Capital Markets,

(3) Work Dynamics,

(4) JLL Technologies, and

Markets Advisory offers a wide range of real estate services, including agency leasing and tenant representation, property management, advisory, and consulting services.

Capital Markets service offerings include investment sales, equity and debt advisory, loan servicing, and valuation advisory.

Our Work Dynamics business provides a broad suite of integrated services to occupiers of real estate, including facility and project management, as well as portfolio and other services.

Our JLL Technologies segment offers software products, solutions and services, while LaSalle provides investment management services on a global basis to institutional investors and high-net-worth individuals.

We allocate all indirect expenses to our segments, other than interest and income taxes, as nearly all expenses incurred benefit one or more of the segments.

Allocated expenses primarily consist of corporate global overhead, which we allocate to the business segments based on the budgeted operating expenses of each segment.

Segment income does not include (i) restructuring and acquisition charges, (ii) interest expense, net of interest income, (iii) other income, and (iv) provision for income tax, which are otherwise included in Net income on the Consolidated Statements of Comprehensive Income.

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.

Allocated expenses primarily consist of corporate functional costs across the globe, which we allocate to the business segments using an expense-specific driver-based methodology.

Adjusted EBITDA does not include (i) depreciation and amortization, (ii) restructuring and acquisition charges, (iii) interest expense, net of interest income, (iii) provision for income tax, (iv) gain on disposal, (v) net non-cash MSR and mortgage which are otherwise included in Net income on the Condensed Consolidated Statements of Comprehensive Income.

The Chief Operating Decision Maker ("CODM") of JLL measures and evaluates the segment results based on Adjusted EBITDA for purposes of making decisions about allocating resources and assessing performance.

Our CODM is not provided with total asset information by segment and accordingly does not measure or allocate resources based on total assets information.

Therefore, we have not disclosed asset information by segment.

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) 2022 2021

Markets Advisory

Leasing $ 600.9 416.6

Capital Markets 421.2 190.8 934.1 579.0

Property & Facility Management 1,564.8 1,433.3 4,576.8 4,331.6

Project & Development Services 389.2 336.2 962.0 917.9

Property Management 370.5 347.6

Advisory, Consulting and Other 28.1 28.5

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Equity earnings $ 0.5 0.4

Segment income $ 285.6 140.0 $ 637.2 277.1

Leasing $ 80.6 58.5 $ 209.0 153.3

Adjusted EBITDA $ 111.2 66.0

Capital Markets

Property & Facility Management 368.5 348.7 1,074.5 1,044.2

Project & Development Services 207.2 190.8 595.7 558.3

Advisory, Consulting and Other 63.3 72.5 192.8 173.6

Investment Sales, Debt/Equity Advisory and Other $ 476.1 302.0

Valuation Advisory 84.6 79.7

Loan Servicing 39.9 30.0

Revenue $ 600.6 411.7

1 unchanged sentence

Equity earnings $ 0.8 0.4

Segment loss $ ( 10.3 ) ( 1.9 ) $ ( 45.8 ) ( 55.8 )

Leasing $ 63.6 46.6 $ 147.7 105.8

Capital Markets 43.4 20.4 125.7 66.1

Property & Facility Management 567.3 521.3 1,729.9 1,568.5

Project & Development Services 111.5 104.5 319.7 296.5

Advisory, Consulting and Other 60.4 50.4 176.9 133.7

Adjusted EBITDA $ 118.2 59.1

Work Dynamics

Workplace Management $ 2,320.4 2,048.4

Project Management 612.3 551.8

Portfolio Services and Other 100.9 97.9

Revenue $ 3,033.6 2,698.1

1 unchanged sentence

Equity earnings $ 0.3 0.1

Segment income $ 20.9 35.8 $ 75.2 57.4

Adjusted EBITDA $ 35.2 24.9

JLL Technologies

Revenue $ 49.4 43.4

Depreciation and amortization $ 3.8 2.9

Equity earnings $ 18.8 34.6

Adjusted EBITDA $ ( 12.3 ) 14.0

Advisory fees $ 97.0 83.5

Transaction fees & other 10.2 17.7 28.9 36.1

Transaction fees and other 17.1 7.7

Incentive fees 4.2 —

1 unchanged sentence

Depreciation and amortization $ 1.4 2.1

Equity earnings (losses) $ 8.4 8.5 $ 44.7 ( 20.5 )

Segment income $ 29.7 29.5 $ 88.9 28.8

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

Three Months Ended September 30, Nine Months Ended September 30,

Equity (losses) earnings $ ( 1.9 ) 13.0

Adjusted EBITDA $ 21.3 26.1

The following table is a reconciliation of Adjusted EBITDA to Net income attributable to common shareholders.

Three Months Ended March 31,

(in millions) 2022 2021

Segment income - Americas $ 285.6 140.0 $ 637.2 277.1

Segment loss - EMEA ( 10.3 ) ( 1.9 ) ( 45.8 ) ( 55.8 )

Segment income - APAC 20.9 35.8 75.2 57.4

Segment income - LaSalle 29.7 29.5 88.9 28.8

Equity earnings ( 17.4 ) ( 15.0 ) ( 106.7 ) ( 1.4 )

Adjusted EBITDA - Markets Advisory $ 111.2 66.0

Adjusted EBITDA - Capital Markets 118.2 59.1

Adjusted EBITDA - Work Dynamics 35.2 24.9

Adjusted EBITDA - JLL Technologies ( 12.3 ) 14.0

Adjusted EBITDA - LaSalle 21.3 26.1

Adjusted EBITDA - Consolidated $ 273.6 190.1

Restructuring and acquisition charges $ ( 19.5 ) ( 17.2 )

Operating income $ 292.9 154.9 $ 597.9 230.3

Gain on disposition — 12.0

Net non-cash MSR and mortgage banking derivative activity ( 3.6 ) 9.7

Interest expense, net of interest income ( 10.2 ) ( 10.4 )

Provision for income taxes ( 40.3 ) ( 28.2 )

Depreciation and amortization ( 54.4 ) ( 53.0 )

Net income attributable to common shareholders $ 145.6 103.0

BUSINESS COMBINATIONS, GOODWILL AND OTHER INTANGIBLE ASSETS

2022 Business Combinations Activity

During the nine months ended September 30, 2021, we completed one strategic acquisition, expanding our capabilities and increasing our presence in key regional markets.

This strategic acquisition is presented below.

Acquired Company Quarter of Acquisition Country Primary Service Line

Skyline AI (Skyline) Q3 Israel Capital Markets

Aggregate terms of our acquisitions included:

(1) cash paid at closing of $ 22.2 million (net of $ 6.7 million in cash acquired) and (2) contingent earn-out consideration of $ 31.3 million which we will pay upon satisfaction of certain performance conditions and which we have initially recorded at their respective acquisition date fair value.

A preliminary allocation of purchase consideration resulted in goodwill of $ 35.3 million, identifiable intangibles of $ 19.5 million and other net liabilities (assumed liabilities less acquired assets) of $ 1.3 million.

As of September 30, 2021, we have not completed our analysis to assign fair values to all of the identifiable intangible and tangible assets acquired and, therefore, we may further refine the purchase price allocations for our 2021 acquisitions during their open measurement periods.

During the nine months ended September 30, 2021, we paid $ 82.5 million for deferred business acquisition and earn-out obligations for acquisitions completed in prior years.

During the three months ended March 31, 2022, there were no strategic acquisitions.

We paid $ 8.5 million for deferred business acquisition and earn-out obligations for acquisitions completed in prior years.

2021 Business Combinations Activity

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

During the three months ended March 31, 2021 we completed no strategic acquisitions.

Earn-Out Payments

($ in millions) September 30, 2021 December 31, 2020

($ in millions) March 31, 2022 December 31, 2021

Number of acquisitions with earn-out payments subject to the achievement of certain performance criteria 20 19

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Goodwill and Other Intangible Assets

Goodwill and unamortized intangibles as of September 30, 2021 consisted of:

In conjunction with our new organizational structure described more fully in Note 3, Business Segments, we reassessed our reporting units as of January 1, 2022, and reassigned goodwill to reflect our new segment structure using a relative fair value allocation approach.

Under this methodology, the fair value of each impacted reporting unit was determined using a combination of the income approach and the market approach, and this resulting relative fair value was used to reassign the balance of goodwill.

We considered the change to our reportable segments a triggering event requiring the testing of our goodwill for impairment as of January 1, 2022.

We performed a quantitative test relying on the discounted cash flow (“DCF”) method, an income approach, in determining the estimated fair value of our reporting units.

Our DCF analysis relied on significant judgements 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.

Our analysis indicated that no impairment existed as the estimated fair value of each of our reporting units exceeded its respective carrying value.

Goodwill and unamortized intangibles as of March 31, 2022 consisted of:

(1) goodwill of $ 4,597.9 million, (2) identifiable intangibles of $ 829.7 million amortized over their remaining finite useful lives, and (3) $ 49.8 million of identifiable intangibles with indefinite useful lives that are not amortized.

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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.

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

Real Estate Services

(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

The following table details, by reporting segment, movements in goodwill.

(in millions) Markets Advisory Capital Markets Work Dynamics JLL Technologies LaSalle Consolidated

Balance as of January 1, 2022 $ 1,782.9 1,983.9 539.9 247.5 57.4 $ 4,611.6

Additions, net of adjustments — 0.8 4.6 0.4 — 5.8

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

Impact of exchange rate movements ( 7.9 ) ( 8.8 ) ( 2.4 ) — ( 0.4 ) ( 19.5 )

Balance as of September 30, 2021 $ 2,902.4 932.2 320.1 57.4 $ 4,212.1

Real Estate Services

(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

Dispositions — ( 0.7 ) — — ( 0.7 )

Impact of exchange rate movements ( 1.1 ) ( 4.7 ) 2.6 ( 0.3 ) ( 3.5 )

Balance as of September 30, 2020 $ 2,876.5 910.5 320.2 56.8 $ 4,164.0

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

MSRs Other Intangibles

(in millions) Americas Americas EMEA Asia Pacific LaSalle Consolidated

Balance as of March 31, 2022 $ 1,775.0 1,975.9 542.1 247.9 57.0 $ 4,597.9

(in millions)

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

(in millions) MSRs Other Intangibles Consolidated

Gross Carrying Amount

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Impact of exchange rate movements — ( 1.2 ) ( 1.2 )

Balance as of September 30, 2021 $ 631.4 270.1 28.9 17.8 55.4 $ 1,003.6

Balance as of March 31, 2022 $ 691.7 555.6 $ 1,247.3

Accumulated Amortization

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Impact of exchange rate movements — 0.4 0.4

Balance as of September 30, 2021 $ ( 183.5 ) ( 113.8 ) ( 14.5 ) ( 4.6 ) ( 6.6 ) $ ( 323.0 )

Net book value as of September 30, 2021 $ 447.9 156.3 14.4 13.2 48.8 $ 680.6

Balance as of March 31, 2022 $ ( 204.7 ) ( 163.1 ) $ ( 367.8 )

Net book value as of March 31, 2022 $ 487.0 392.5 $ 879.5

(1) Included in this amount for MSRs was $ 7.8 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.

MSRs Other Intangibles

(in millions) Americas Americas EMEA Asia Pacific LaSalle Consolidated

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

(in millions) MSRs Other Intangibles Total

Gross Carrying Amount

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Impact of exchange rate movements — ( 1.9 ) ( 1.9 )

Balance as of September 30, 2020 $ 527.4 271.4 54.0 22.2 55.9 $ 930.9

Balance as of March 31, 2021 $ 605.4 393.9 $ 999.3

Accumulated Amortization

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

Balance as of September 30, 2020 $ ( 138.6 ) ( 88.8 ) ( 37.0 ) ( 7.9 ) ( 4.7 ) $ ( 277.0 )

Net book value as of September 30, 2020 $ 388.8 182.6 17.0 14.3 51.2 $ 653.9

(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 an impairment valuation allowance.

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

INVESTMENTS IN REAL ESTATE VENTURES

As of September 30, 2021 and December 31, 2020, we had Investments in real estate ventures of $ 646.6 million and $ 430.8 million, respectively.

Approximately 90% of our investments, as of September 30, 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 September 30, 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.

Balance as of March 31, 2021 $ ( 162.7 ) ( 149.6 ) $ ( 312.3 )

Net book value as of March 31, 2021 $ 442.7 244.3 $ 687.0

(1) Included in this amount for MSRs was $ 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 within the Condensed Consolidated Statements of Comprehensive Income.

As of March 31, 2022 and December 31, 2021, we had investments of $ 785.3 million and $ 745.7 million, respectively.

Summarized investment balances are presented in the following table.

(in millions) March 31, 2022 December 31, 2021

JLL Technologies investments $ 396.4 353.6

LaSalle co-investments 351.3 354.6

Other investments 37.6 37.5

Total $ 785.3 745.7

Approximately 90% of our investments, as of March 31, 2022, are (i) investments by JLL Technologies in proptech funds and early to mid-stage proptech companies, or (ii) direct investments in 55 separate property or commingled funds, where we co-invest alongside our clients and for which we also have an advisory agreement.

The remaining 10% of our investments, as of March 31, 2022, 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 $ 315.9 million as of September 30, 2021.

We have maximum potential unfunded commitments to direct investments or investment vehicles of $ 360.8 million as of March 31, 2022.

Of this amount, while we remain contractually obligated, we do not expect a call on the $ 60.3 million relating to our investment in LIC II as its fund life terminated in January 2020.

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

(in millions) September 30, 2021 December 31, 2020

(in millions) March 31, 2022 December 31, 2021

Property and equipment, net $ 195.4 184.7

Investments in real estate ventures 9.8 9.0

Investments 10.4 10.2

Other assets 24.3 17.7

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Total liabilities and members' equity $ 230.1 212.6

Three Months Ended September 30, Nine Months Ended September 30,

Three Months Ended March 31,

(in millions) 2022 2021

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Operating and other expenses ( 5.7 ) ( 3.2 )

Net gains on sale of investments (1)

Net (loss) income $ ( 0.9 ) 3.0 $ ( 2.1 ) 14.2

(1) $12.2 million of the 2020 year-to-date gain was included in Equity earnings;

the remaining $3.1 million was included in Other income.

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, 2021 and 2020.

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

Net loss $ ( 2.2 ) ( 0.6 )

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

There were no significant other-than-temporary impairment charges on investments for the three months ended March 31, 2022 and 2021.

We report a majority of our investments at fair value.

For such investments, we increase or decrease our investment each reporting period by the change in the fair value and we report these fair value adjustments in our Condensed Consolidated Statements of Comprehensive Income within Equity earnings.

The table below shows the movement in our investments in real estate ventures reported at fair value.

The table below shows the movement in our investments reported at fair value.

(in millions) 2022 2021

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Foreign currency translation adjustments, net ( 4.9 ) ( 3.1 )

Fair value investments as of September 30, $ 537.7 299.0

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

Fair value investments as of March 31, $ 677.5 435.4

See Note 7, Fair Value Measurements, for additional discussion of our investments reported at fair value.

STOCK-BASED COMPENSATION

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Contractual Life

Unvested as of June 30, 2021 1,118.1 545.2 1,663.3 $ 144.01 1.92

Granted 23.7 58.8 82.5 205.50

Vested ( 199.6 ) — ( 199.6 ) 141.21

Forfeited ( 6.9 ) ( 9.4 ) ( 16.3 ) 145.07

Unvested as of September 30, 2021 935.3 594.6 1,529.9 $ 147.75 1.96

Unvested as of June 30, 2020 1,343.2 558.8 1,902.0 $ 137.93 2.01

Granted 11.2 4.4 15.6 107.51

Vested ( 213.5 ) — ( 213.5 ) 140.38

Forfeited ( 13.0 ) ( 4.5 ) ( 17.5 ) 134.03

Unvested as of September 30, 2020 1,127.9 558.7 1,686.6 $ 137.49 1.85

(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, 2021 912.4 646.0 1,558.4 $ 152.27 1.99

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Forfeited ( 2.8 ) ( 4.8 ) ( 7.6 ) 174.32

Unvested as of September 30, 2021 935.3 594.6 1,529.9 $ 147.75 1.96

Unvested as of March 31, 2022 786.8 466.1 1,252.9 $ 152.62 1.84

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

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Forfeited ( 5.0 ) ( 13.4 ) ( 18.4 ) 149.11

Unvested as of September 30, 2020 1,127.9 558.7 1,686.6 $ 137.49 1.85

As of September 30, 2021, we had $ 105.1 million of unamortized deferred compensation related to unvested RSUs and PSUs, which we anticipate recognizing over varying periods into 2026;

$ 12.9 million relates to the awards issued in conjunction with the HFF acquisition.

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

As of March 31, 2022, we had $ 86.5 million of unamortized deferred compensation related to unvested RSUs and PSUs, which we anticipate recognizing over varying periods into 2026.

FAIR VALUE MEASUREMENTS

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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 $ 692.9 million and $ 723.7 million as of September 30, 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 $ 678.6 million and $ 702.0 million as of September 30, 2021 and December 31, 2020, respectively, and included debt issuance costs of $ 2.0 million and $ 2.5 million, respectively.

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

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

We estimated the fair value of our Long-term debt, including its current portion, as $ 667.9 million and $ 687.2 million as of March 31, 2022 and December 31, 2021, respectively, using dealer quotes that are Level 2 inputs in the fair value hierarchy.

The carrying value of our Long-term debt includes (1) the current portion of $ 274.7 million as of both March 31, 2022 and December 31, 2021, which included debt issuance costs of $ 0.3 million;

and (2) the long-term portion of $ 387.8 million and $ 395.6 million, as of March 31, 2022 and December 31, 2021, respectively, which included debt issuance costs of $ 1.4 million as of both March 31, 2022 and December 31, 2021.

Investments at Fair Value - Net Asset Value ("NAV")

We report a significant portion of our investments at fair value.

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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.

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 September 30, 2021, there were no such adjustments compared with adjustments of $22.8 million as of December 31, 2020.

We did not consider any 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 September 30, 2021 and December 31, 2020, investments in real estate ventures at fair value using NAV were $ 245.3 million and $ 203.8 million, respectively.

As of March 31, 2022 and December 31, 2021, investments at fair value using NAV were $ 387.4 million and $ 372.8 million, respectively.

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

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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, 2021 December 31, 2020

March 31, 2022 December 31, 2021

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

Investments in real estate ventures - fair value $ 84.7 — 207.7 77.2 — 59.3

Investments - fair value $ 70.1 — 220.0 84.5 — 182.3

Foreign currency forward contracts receivable — 19.3 — — 15.9 —

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Total liabilities at fair value $ — 497.8 143.7 — 513.8 122.6

Investments in Real Estate Ventures

We classify two investments as Level 1 in the fair value hierarchy as quoted prices are readily available.

We classify one investment as Level 1 in the fair value hierarchy as quoted price are readily available.

We increase or decrease our investment each reporting period by the change in the fair value of the investment.

We report these fair value adjustments in our Condensed Consolidated Statements of Comprehensive Income within Equity earnings.

We report the fair value adjustments in our Condensed Consolidated Statements of Comprehensive Income within Equity earnings.

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.

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

As of September 30, 2021 and December 31, 2020, these contracts had a gross notional value of $ 2.10 billion ($ 1.25 billion on a net basis) and $ 2.34 billion ($ 1.42 billion on a net basis), respectively.

As of March 31, 2022 and December 31, 2021, these contracts had a gross notional value of $ 2.41 billion ($ 1.28 billion on a net basis) and $ 2.61 billion ($ 1.51 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 $ 7.3 million asset as of September 30, 2021, was composed of gross contracts with receivable positions of $ 8.7 million and payable positions of $ 1.4 million.

The $ 17.2 million liability as of September 30, 2021, was composed of gross contracts with receivable positions of $ 0.8 million and payable positions of $ 18.0 million.

The $ 19.3 million asset as of March 31, 2022, was composed of gross contracts with receivable positions of $ 22.0 million and payable positions of $ 2.8 million.

The $ 4.0 million liability as of March 31, 2022, was composed of gross contracts with receivable positions of $ 2.4 million and payable positions of $ 6.4 million.

As of December 31, 2021, the $ 15.9 million asset was composed of gross contracts with receivable positions of $ 19.2 million and payable positions of $ 3.3 million.

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Warehouse Receivables

As of September 30, 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.

As of March 31, 2022 and December 31, 2021, 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.

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employees that allows them to defer portions of their compensation.

We recorded this plan on our Condensed Consolidated Balance Sheet as of September 30, 2021, as Deferred compensation plan assets of $ 522.2 million, long-term deferred compensation plan liabilities of $ 499.9 million, included in Deferred compensation, and as a reduction of equity, Shares held in trust, of $ 5.2 million.

We recorded this plan on our Condensed Consolidated Balance Sheet as of March 31, 2022 as Deferred compensation plan assets of $ 558.3 million, long-term deferred compensation plan liabilities of $ 493.8 million, included in Deferred compensation, and as a reduction of equity, Shares held in trust, of $ 5.1 million.

We recorded this plan on our Condensed Consolidated Balance Sheet as of December 31, 2021 as Deferred compensation plan assets of $ 528.8 million, long-term deferred compensation plan liabilities of $ 513.0 million, included in Deferred compensation, and as a reduction of equity, Shares held in trust, of $ 5.2 million.

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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, 2021 Net change in fair value Foreign CTA (1)

Purchases / Additions Settlements Balance as of September 30, 2021

Investments in real estate ventures $ 181.6 6.1 0.3 19.7 — $ 207.7

Mortgage banking derivative assets and liabilities, net 12.6 7.3 — 57.8 ( 44.0 ) 33.7

Earn-out liabilities 18.0 — 0.3 27.5 ( 0.4 ) 45.4

Balance as of June 30, 2020 Net change in fair value Foreign CTA (1)

Purchases / Additions Settlements Balance as of

September 30, 2020

Investments in real estate ventures $ 44.3 4.3 — 1.6 — $ 50.2

Mortgage banking derivative assets and liabilities, net ( 5.5 ) ( 2.6 ) — 48.2 ( 33.9 ) 6.2

Earn-out liabilities 97.8 ( 0.6 ) 0.7 — ( 2.9 ) 95.0

(in millions) Balance as of December 31, 2021 Net change in fair value Foreign CTA (1)

Purchases / Additions Settlements Level transfer out (2)

Balance as of September 30, 2021

Investments in real estate ventures $ 59.3 44.2 0.3 105.9 ( 0.1 ) ( 1.9 ) $ 207.7

Purchases / Additions Settlements Balance as of

March 31, 2022

Investments $ 182.3 17.2 — 20.5 — $ 220.0

Mortgage banking derivative assets and liabilities, net 21.9 20.4 — 37.6 ( 42.8 ) 37.1

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Purchases / Additions Settlements Balance as of

September 30, 2020

Investments in real estate ventures $ 34.4 6.8 — 9.0 — $ 50.2

March 31, 2021

Investments $ 59.3 31.8 — 49.1 ( 0.1 ) $ 140.1

Mortgage banking derivative assets and liabilities, net 13.7 18.9 — 41.1 ( 40.8 ) 32.9

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Currency translation adjustments

(2) In May 2021, an investment previously treated as a Level 3 investment became publicly traded on the NYSE and was considered a Level 1 investment immediately.

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

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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

Investments Equity earnings

Other current assets - Mortgage banking derivative assets Revenue

Other current liabilities - Mortgage banking derivative liabilities Revenue

Non-Recurring Fair Value Measurements

We review our investments in real estate ventures, except those investments otherwise reported at fair value, on a quarterly basis, or as otherwise deemed necessary, for indications of whether we may be unable to recover the carrying value of our investments and whether such investments are other-than-temporarily impaired.

We review our investments, except those investments otherwise reported at fair value, on a quarterly basis, or as otherwise deemed necessary, for indications of whether we may be unable to recover the carrying value of our investments and whether such investments are other-than-temporarily impaired.

When the carrying amount of the investment is in excess of the estimated future undiscounted cash flows, we use a discounted cash flow approach or other acceptable method to determine the fair value of the investment in computing the amount of the impairment.

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 nine months ended September 30, 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, 2021 December 31, 2020

Short-term borrowings:

We did not recognize any significant investment-level impairment losses during either of the three months ended March 31, 2022 or 2021.

See Note 5, Investments, for additional information, including information related to impairment charges recorded at the investee level.

Debt is composed of the following obligations.

($ in millions) March 31, 2022 December 31, 2021

Short-term debt:

Local overdraft facilities $ 7.7 9.2

Other short-term borrowings 110.5 138.7

Total short-term borrowings $ 117.6 62.0

Long-term senior notes, 4.4 %, face amount of $ 275.0 , due November 2022, net of debt issuance costs of $ 0.3 and $ 0.3

Total short-term debt $ 392.9 422.6

Credit facility, net of debt issuance costs of $ 11.3 and $ 11.8

1,113.7 138.2

Long-term senior notes, 4.4 %, face amount of $ 275.0 , due November 2022, net of debt issuance costs of $ 0.3 and $ 0.8

Long-term senior notes, 1.96 %, face amount of € 175.0 , due June 2027, net of debt issuance costs of $ 0.6 and $ 0.6

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Credit Facility

We have a $ 2.75 billion unsecured revolving credit facility (the "Facility") that matures on to April 14, 2026.

Pricing on the Facility ranges from LIBOR plus 0.875% to 1.35% , with pricing as of September 30, 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 September 30, 2021 and December 31, 2020.

We have a $ 2.75 billion unsecured revolving credit facility (the "Facility") that matures on April 14, 2026.

Pricing on the Facility ranges from LIBOR plus 0.875% to 1.35% , with pricing as of March 31, 2022 at LIBOR plus 0.88 %.

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, 2022 and December 31, 2021.

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) 2022 2021

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Amounts outstanding are presented in the debt table above.

As of September 30, 2021, our issuer and senior unsecured ratings are investment grade:

As of March 31, 2022, our issuer and senior unsecured ratings are investment grade:

Baa1 from Moody’s Investors Service, Inc.

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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, 2021.

We remained in compliance with all covenants as of March 31, 2022.

Warehouse Facilities

September 30, 2021 December 31, 2020

March 31, 2022 December 31, 2021

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

Warehouse facilities:

LIBOR plus 1.30% , expires November 15, 2021 (1)

BSBY plus 1.30% , expires September 19, 2022

$ 123.4 700.0 516.9 700.0

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LIBOR plus 1.60% , expires July 30, 2022

— 400.0 — 400.0

Fannie Mae ASAP (1) program, SOFR plus 1.25%

41.7 n/a 12.5 n/a

LIBOR plus 1.50%

— — 261.6 300.0

Gross warehouse facilities 706.1 2,600.0 796.9 2,600.0

1 unchanged sentence

Total warehouse facilities $ 705.3 2,600.0 795.7 2,600.0

(1) In the third quarter of 2021, JLL extended the Warehouse facility;

previously, the facility had a maturity date of September 20, 2021.

In the second quarter of 2021, JLL increased the maximum capacity of the Warehouse facility with a decrease to the interest rate;

previously, the facility had an interest rate of LIBOR plus 1.40% and a maximum capacity of $400.0 million.

(2) In the third quarter of 2021, JLL extended the Warehouse facility with a temporary increase to the maximum capacity;

previously the facility had a maturity date of September 18, 2021 and a temporary maximum capacity of $1,600.0 million which expired on January 31, 2021 and thereafter reverted to its original contractual amount.

In the second quarter of 2021, JLL amended the Warehouse facility with a decrease to the interest rate;

previously the facility had an interest rate of LIBOR plus 1.40%.

(3) In the third quarter of 2021, JLL extended the Warehouse facility with an increase to the maximum capacity;

previously, the facility had a maturity date of August 27, 2021 and a temporary maximum capacity of $900.0 million which expired on January 6, 2021 and thereafter reverted to its original contractual amount.

In the second quarter of 2021, JLL amended the Warehouse facility with a decrease to the interest rate;

previously the facility had an interest rate of LIBOR plus 1.40%.

(4) In the third quarter of 2021, JLL added a new secured borrowing for $400.0 million under a master repurchase agreement that is scheduled to expire on July 30, 2022.

Advances are made at 100% of the loan balance and borrowings are secured by the related warehouse receivables and bear interest at LIBOR plus 1.60%.

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

(6) JLL amended the Fannie Mae ASAP program interest rate to Secured Overnight Financing Rate ("SOFR") plus 1.25%;

previously, the facility had an interest rate of LIBOR plus 1.15%.

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

1 unchanged sentence

Pursuant to these 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 facilities as of September 30, 2021.

We remained in compliance with all covenants under our facilities as of March 31, 2022.

COMMITMENTS AND CONTINGENCIES

3 unchanged sentences

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 $ 22.5 million and $ 44.0 million as of September 30, 2021 and December 31, 2020, respectively, and are included in Notes and other receivables and Long-term receivables on our Condensed Consolidated Balance Sheets.

In total, these receivables were $ 22.5 million as of both March 31, 2022 and December 31, 2021 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.

1 unchanged sentence

December 31, 2021 $ 1.2

New claims 1.5

Prior year claims adjustments (including foreign currency changes) —

Claims paid —

September 30, 2021 $ 25.8

March 31, 2022 $ 1.2

December 31, 2020 $ 48.2

New claims 5.8

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

Claims paid ( 0.4 )

September 30, 2020 $ 44.7

March 31, 2021 $ 17.6

Delegated Underwriting and Servicing ("DUS") Program Loan Loss-Sharing

2 unchanged sentences

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, 2021 and December 31, 2020, we had loans subject to such loss-sharing arrangements with an aggregate unpaid principal balance of $ 14.7 billion and $ 12.2 billion, respectively.

As of March 31, 2022 and December 31, 2021, we had loans subject to such loss-sharing arrangements with an aggregate unpaid principal balance of $ 15.8 billion and $ 15.4 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, 2021 and December 31, 2020, the loss-sharing guarantee obligations were $ 24.1 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 and nine months ended September 30, 2021 and 2020.

As of March 31, 2022 and December 31, 2021, the loss-sharing guarantee obligations were $ 24.8 million and $ 24.6 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, 2022 and 2021.

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 September 30, 2021 and December 31, 2020, the loan loss guarantee reserve was $ 22.9 million and $ 36.7 million, respectively, and are included within Other liabilities on our Condensed Consolidated Balance Sheets.

As of both March 31, 2022 and December 31, 2021, the loan loss guarantee reserve was $ 22.9 million, and is included within Other liabilities on our Condensed Consolidated Balance Sheets.

RESTRUCTURING AND ACQUISITION CHARGES

Restructuring and acquisition charges include cash and non-cash expenses.

Cash-based charges primarily consist of (1) severance and employment-related charges, including those related to external service providers, incurred in conjunction with a structural business shift, which can be represented by a notable change in headcount, change in leadership, or transformation of business processes, (2) acquisition, transaction and integration-related charges, and (3) other restructuring including lease exit charges.

Non-cash charges include (1) stock-based compensation expense for retention awards issued in conjunction with the HFF acquisition and (2) fair value adjustments to earn-out liabilities relating to prior-period acquisition activity.

Cash-based charges primarily consist of (i) severance and employment-related charges, including those related to external service providers, incurred in conjunction with a structural business shift, which can be represented by a notable change in headcount, change in leadership, or transformation of business processes, (ii) acquisition, transaction and integration-related charges, and (iii) other restructuring, including lease exit charges.

Non-cash charges include (i) stock-based compensation expense for retention awards issued in conjunction with the HFF, Inc.

("HFF") acquisition and (ii) fair value adjustments to earn-out liabilities relating to prior-period acquisition activity.

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) 2022 2021

4 unchanged sentences

Restructuring and acquisition charges $ 19.5 17.2

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

(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 2.1 7.7 24.9 34.7

Payments made ( 29.0 ) ( 9.4 ) ( 19.9 ) ( 58.3 )

September 30, 2021 $ 14.4 0.8 6.2 $ 21.4

(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 27.6 9.3 16.6 53.5

Payments made ( 22.1 ) ( 16.0 ) ( 20.4 ) ( 58.5 )

September 30, 2020 $ 29.8 1.7 — $ 31.5

We expect the majority of accrued severance and other accrued acquisition costs as of September 30, 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 $ 6.6 million and $ 30.5 million, respectively, for the three and nine months ended September 30, 2021 compared to $ 13.8 million and $ 55.2 million, respectively, for the three and nine months ended September 30, 2020 of charges relating to the acquisition and integration of HFF (including retention and severance expense, early lease termination costs, and other integration expenses).

Nearly all expenses related to (i) severance and other employment-related charges and (ii) restructuring, pre-acquisition and post-acquisition charges as of March 31, 2022 will be paid during the next twelve months.

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) BY COMPONENT

1 unchanged sentence

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

Balance as of June 30, 2021 $ ( 80.7 ) ( 302.4 ) $ ( 383.1 )

Other comprehensive loss before reclassification — ( 47.2 ) ( 47.2 )

Amounts reclassified from AOCI after tax expense of

$ - , $ - and $ - — — —

Other comprehensive loss after tax expense of $ - , $ - and $ - — ( 47.2 ) ( 47.2 )

Balance as of September 30, 2021 $ ( 80.7 ) ( 349.6 ) $ ( 430.3 )

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

Balance as of June 30, 2020 $ ( 72.0 ) ( 465.4 ) $ ( 537.4 )

Other comprehensive income before reclassification — 59.3 59.3

Amounts reclassified from AOCI after tax expense of

$ - , $ - and $ - 0.7 — 0.7

Other comprehensive income after tax expense of $ - , $ - and $ - 0.7 59.3 60.0

Balance as of September 30, 2020 $ ( 71.3 ) ( 406.1 ) $ ( 477.4 )

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

Balance as of December 31, 2021 $ ( 42.7 ) ( 352.7 ) $ ( 395.4 )

2 unchanged sentences

$ - , $ - and $ - — — —

Other comprehensive income (loss) after tax expense of $ - , $ - and $ - 0.5 ( 53.6 ) ( 53.1 )

Balance as of September 30, 2021 $ ( 80.7 ) ( 349.6 ) $ ( 430.3 )

Other comprehensive loss after tax expense of $ - , $ - and $ - — ( 24.1 ) ( 24.1 )

Balance as of March 31, 2022 $ ( 42.7 ) ( 376.8 ) $ ( 419.5 )

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

3 unchanged sentences

$ - , $ - and $ - ( 0.2 ) — ( 0.2 )

Other comprehensive income (loss) after tax expense of $ - , $ - and $ - 0.7 ( 50.3 ) ( 49.6 )

Balance as of September 30, 2020 $ ( 71.3 ) ( 406.1 ) $ ( 477.4 )

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

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

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.

1 unchanged sentence

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