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This Research Note examines two businesses within JLL which offer technical operations and maintenance (O&M) solutions and services for commercial real estate – JLL Workplace Management and JLL Technologies. This article is based on JLL’s 2022 Annual Report, their 2022 investor briefing and transcript and previous Memoori analysis on the company’s technology strategy in the smart commercial buildings space. JLL is one of the largest real estate service providers in the world, with 2022 consolidated revenue of $20.9 billion (+11% versus prior year) and fee revenue rising 7% year-on-year to $8.3 billion. The group has operations in over 80 countries and a global workforce of more than 103,000. JLL Annual Report 2022 JLL Workplace Management (WPM) JLL Workplace Management business, one of 3 divisions in the Work Dynamics segment, provides comprehensive facility management services globally to corporations and institutions that outsource the management of the real estate they occupy, typically those with large multi-market portfolios […]

The commercial building industry has been notoriously slow in its adoption of new smart buildings technologies, struggling with a deep-seated inertia that has seen innovation lag other market verticals. Bound by the shackles of long-established practices and the burden of decades-old infrastructure and systems, it remains highly resistant to disruption. Complex supply chains, entrenched ecosystems, and convoluted design and procurement processes, seemingly set in stone, further deter market disruptors. With a mindset deeply rooted in the adage “If it ain’t broke, don’t fix it,” breaking free from these shackles presents a significant challenge. As part of our recent research into the Building Internet of Things, we’ll explore this resistance and propose ways the industry can start to overcome these traditional barriers. Capital Investment & Risk Aversion To start, let’s consider the significant role of capital investment. Traditional building systems, such as HVAC, lighting, and security systems, represent a considerable sunk cost for building owners and […]

“We have just lived through a decade of historically low-interest rates, which has now all but come to a stop. While this has broad sweeping impacts for the economy at large, for venture capitalists this has dramatically increased the opportunity cost of capital for general partners,” says Mike McAra, director at Second Century Ventures and NAR REACH Canada. “On a risk-adjusted basis, the hurdle rate for investment is much higher now than just six months ago, and thus capital is being allocated much more diligently and much slower.” Commercial real estate is going through a tough time in the wake of the pandemic and as economic clouds loom on the horizon. Soaring interest rates and low vacancy levels are forcing real estate firms to streamline expenses by cutting out any non-essential spending, which has left a wide range of proptech technologies on the wrong side of the budgeting discussion. The “nice to have” products and […]