JLL Shifting To An Investment Banking Model
https://commercialobserver.com/2024/03/jll-riguar…
Came across this commercial observer article yesterday. I’m a little interested in hearing what people think of this shift and how will it affect brokerage going forward. It seems like Eastdil does very well in IS and D/E because of their more IB leaning model and HFF had a similar structure too. I could definitely see a big part of this shift being driven by former HFF producers who want to rebuild what they had before but with a wide range of services like leasing and property management.
That sounds a whole lot like a meaningless circle jerk among JLL corporate executives.
Aka "You're not allowed to be a star even if you deserve to be based on your production. The company comes first."
Large brokerages have worked like that forever. Even 10+ years ago, the brokerage I worked for was broken down by coverage areas.
Every company uses data-driven technology. It's 2024.
"This star broker thing really gives them all of the power. We're going to make sure the kids coming up work long hours per week without any hope of becoming a star so the corporate overlords keep the power."
Agreed on all counts! I wonder if they blew each other after interviewing for the article.
Corporate leaders at brokerage firms are so tone-deaf. They just get in the way
Imagine having your head up your ass this much.
Peter is such a tool.
what is the difference? I understand legitimate REIB with balance sheet capabilities vs brokerage. I do not understand what people mean by calling HFF, Eastdil, etc “IB”.
Selling buildings is selling buildings, same with D/E services. For example Eastdil is good where I’m at but also do the same exact thing as every other brokerage in my market.
Genuinely curious if there’s any differentiation. Maybe I’m wrong but seems like JLL are just switching terminology around to further appeal to institutional investors.
Just terminology. It means absolutely nothing. They’re doing it for institutional investors and also to trick juniors into thinking they’re going into “banking” so they’re willing to take garbage pay
Eastdil has an M&A advisory practice which is separate from investment sales.
Eastdil has an M&A advisory practice which is separate from investment sales.
So does CBRE
I don’t understand. What’s the goal here for JLL? Was their business suffering so much from all the “star power”?
They want to be Eastdil so badly 😂
I never got the banking thing even at Eastdil, it's real estate it's not that complex and you aren't doing the lords work. You're working as a middleman for deals. Crazy the mindset some people at top schools and top firms have about their job and prestige in real estate.
Funny to hear analysts at top firms like BGO, Two Sigma, PGIM, others with their tech enabled platforms and quantitative methods closing on small walkups or $40mm industrial deals then you go to a small, entrepreneurial firm with less pedigree that is doing the same thing and may have a portfolio of 50-100 properties with low debt making actual money.
This article made me never want to use JLL again lmao
Juniors are gonna get shafted on pay at JLL regardless of how they market themselves which really sucks. It’s 2024, analyst pay shouldn’t be between 60 and 80k and interns shouldn’t be comped at 20 an hour. Not asking for an industry topping comp package but something in line with the rest of the industry would be nice.
I understand RE banking wanting to become more IB like (focus on increasing fee income- capital markets, syndications, treasury, servicing, etc and not just rely on the balance sheet) but when a brokerage wants to become more IB like, what exactly does that mean? Does anyone know?
They’d like to think of themselves that way, but this is all just lip service. This is like an apple calling itself an orange. What’s wrong with just trying to be a great brokerage? It’s two entirely different business models.
The best teams at big brokerages already function like an investment bank, with a deep bench of analysts/associates, senior guys driving the BD, pooled bonuses, retainers/account work from institutional clients etc. But this wouldn’t work for 75% of teams.
After reading this again I’ve convinced myself that Riguardi arranged this piece to: a.) manage the Knakal fallout b.) lobby internally for a promotion and is trying to pump his own stock
Either way it seems disorganized and more like the personal musings of his brain rather than some broader strategy JLL’s rolling out
There may be a deep bench but it's real estate sales not investment banking, it's ridiculous they call it that to make it seem more sophisticated. Spot on with the apples and oranges comparison.
They want to be Eastdil so bad it hurts. That’s all I could gather from the article.
My favorite part was when the capital markets broker bragged about how he’ll now pick up the phone and talk to his colleague on the leasing side for leasing assumptions.
Bruh…is that really a new phenomenon for you?
This just reads as PR cope for losing Knakal
Side question, why do a good amount of JLL folk come off as dicks. I get the vibe that they think they’re better than others in the brokerage world. And yes, a lot of their people do very well but I don’t get the same vibe from the big competitors like CBRE.
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