Jones Lang LaSalle Incorporated (JLL) Earnings Call Transcript & Summary

Hello, everyone. Thank you for joining us, and welcome to the Q3 2026 Earnings Conference Call for Jones Lang LaSalle Incorporated. [Operator Instructions] I will now hand the conference over to Sean Coghlan, Head of Investor Relations. Sean, please go ahead.

Thank you, and good morning. Welcome to the Third Quarter 2026 Earnings Conference Call for Jones Lang LaSalle Incorporated. Earlier this morning, we issued our earnings release, along with the slide presentation and Excel file intended to supplement our prepared remarks. These materials are available on the Investor Relations section of our website. Please visit ir.jll.com. During the call, as well as in our slide presentation and supplemental excel file we referenced certain non-GAAP financial measures, which we believe provide useful information for investors. We include recciliations of non-GAAP financial measures to GAAP in our earnings release and slip presentation. We also referenced resilient and advisory revenues, which we defined in the footnotes of our earnings release. As a reminder, today's call is being webcast live and recorded. A transcript and recording of this conference call will be posted to our website. Any statements made about future results and performance, plans, expectations and objectives are forward-looking statements. Actual results and performance may differ from forward-looking statements as a result of factors discussed in our annual report on Form 10-K and in other reports filed with the SEC. The company disclaims any undertaking to publicly update or revise any forward-looking statements. Finally, a reminder that percentage variances are against the prior year period in local currency, unless otherwise noted. I will now turn the call over to Christian Ulbrich, our President and Chief Executive Officer, for opening remarks.

Thank you, Sean. This morning, we reported a record third quarter at both the top and bottom line. Revenue increased 12%. Advisory growth accelerated to 22% even against tougher comparisons and our resilient businesses delivered continued growth in line with expectations. Adjusted EBITDA increased 33% with margins expanding faster and notably higher than a year ago. Adjusted EPS accelerated even more, up 52%, a very strong result, reflecting our track record of converting growth into profit for shareholders. Last quarter, I told you I was pleased with how Accelerate 2030 was taking hold across JLL. Even at this early stage, our momentum and progress are very encouraging. Our teams are aligned behind our strategy, and we are evolving how we serve our clients, how we operate as 1 firm and how we lead our industry. That includes strengthening our leadership team organization and operations, evolving the foundation to achieve our long-term strategic and financial objectives. We have a clear and focused strategy with each of our 6 accelerate 2030 imperatives positioned to expand our leadership across our core businesses. Today, I will update you on 2 of the 6 and parties of Accelerate 2030, deepen client relationships and unlock platform excellence. Let me start with deepen client relationships. Clients are consolidating around fewer, more strategic partners and that favors an integrated firm like JLL. The objective of this imperative is to position JLL as the integrated partner, but the world's leading occupiers and investors turn to across the full real estate life cycle. That requires a programmatic One JLL approach across our global teams to service enterprise clients seamlessly. We use our proprietary data to identify where we can deliver more value for each client and then focus our growth efforts on the right opportunities. The foundation is strong. Over the last 3 years, we have retained 99% of our top 100 clients, and working across business lines as One JLL is part of our culture. It gives us significant upside, more clients to win an existing enterprise relationships to expand. We have established a team of country CEOs across our most important markets to deliver a seamless One JLL experience for clients wherever they engage with us. In each major market, the country CEO is our most senior leader on the ground. They coordinate across business lines and drive cross-selling to client experience and our global reach combined with local expertise. Earlier this month, we appointed Mark Gibson as our country CEO for the U.S., our largest market. Mark has led Capital Markets Americas for 7 years and before that led HFF until we acquired it in 2019. Joins a very strong team of country leaders working together to capture the client opportunity. PacomExcellence is the operational engine behind Accelerate 2030. For the last decade, we have built a unified global platform incorporating our operating structure, our leading technology tools and our shared service model. The next stage is scaling that platform across our businesses globally and accelerating the value it creates. So every business line can benefit from shared capabilities, consistent delivery and greater efficiency. In September, we named Paul Morgan previously CEO of Real Estate Management Services as our Chief Operating Officer. Paul has joined our Global Executive Board, and he's bringing our enterprise operations together in 1 global function. Building on our platform, we are making progress quickly, and AI is an integrated part of it. Here are 2 recent examples. In July, we launched Ask JLL, an AI-powered front door for colleagues around the world, empowering them to find answers and act across our corporate functions such as conditional HR and IT support. We're also redesigning invoicing and collections across our business lines globally using AI agents and automation. As our platform scales, it frees capacity for growth, unlocks cash faster, lowers the cost to serve, drive standardization and tightens controls. Increasingly, it offers real-time opportunities to improve working capital efficiency. As part of Accelerate 2030, we expect the enhancement of our platform to contribute more than 20 basis points of annual margin expansion on average, increasing as years progress. That is roughly 1/3 of the annual expansion embedded in our Accelerate 2030 targets. The advancements we have made on our Accelerate 2030 strategy reflects the steps we are taking across JLL to make our organization even more integrated, more efficient and more resilient. With that, I will now turn the call over to Kelly Howe, our Chief Financial Officer, who will provide more details on our results for the quarter.

Thank you, Christian. Our third quarter results reflect the continued business momentum and ongoing progress on our operating initiatives. The pace of growth in both our advisory and resilient revenues increased, driving an acceleration in total revenue growth. ongoing platform efficiency improvements converted the top line gains into robust profit growth, healthy margin expansion and meaningful cash flow generation. We continue to deploy capital with discipline balancing investment in talent, capabilities and platform while also repurchasing shares and reviewing an active M&A pipeline. . While the macro backdrop remains uneven, we are encouraged by the breadth of demand across our business lines and are well positioned to build on our operating momentum and strategic initiatives. Now a review of our operating performance by segment. The following commentary is in local currency to best reflect underlying operating performance. Beginning with Real Estate Management Services, revenue growth was led by continued momentum in workplace management and an acceleration in project management. Within workplace management, a largely balanced mix of mandate expansions and new client wins drove double-digit growth. Our pipeline and contract renewal rates remain strong. For project management, higher pass-through costs augmented a mid-single-digit increase in management fees. Growth was led by double-digit growth in the U.S. and India with particular strength in office and data centers. On a 2-year stacked basis, project management revenue increased 38%, inclusive of 14% growth in the current quarter. Client activity remains healthy, albeit with softness in certain geographies. Within Property Management, underlying core business growth and new wins, primarily in North America, Japan and India continue to be largely offset by the strategic contract exits in Asia Pacific over the past year. At quarter end, we had completed actions on approximately 80% of the identified contracts while retaining more than we anticipated and importantly, at improved margins. We expect to complete the contract exits and modifications by year-end and anticipate the associated growth headwinds to dissipate over the course of 2027. We continue to target mid- to high single-digit full year revenue growth for the Real Estate Management Services segment with variances by business line. Additionally, we remain focused on driving incremental platform leverage, which is evident in our year-to-date margin expansion. Moving next to Leasing & Advisory. The acceleration in revenue growth to 27% was driven by continued momentum in the U.S., particularly within the industrial, office and data center asset classes. On a 2-year stacked basis, global leasing advisory revenue growth increased to 34%, reflecting strong ongoing and broadening demand, most notably in the U.S. a meaningful rise in average deal size as well as a few large data center transactions drove the 39% increase in U.S. leasing advisory revenue. Global office leasing revenue growth comfortably outpaced market volumes highlighted by meaningful U.S. outperformance. The U.S. industrial revenue growth also notably outperformed market volume. The increases in leasing advisory adjusted EBITDA and margins were driven by revenue growth, net of higher commission expense from higher tiers being met sooner compared to a year ago, incremental platform leverage and business mix. We expect the commission to your headwind to moderate in the fourth quarter. Looking ahead, market fundamentals remain strong. The OECD Business Confidence Index, a 2 to 3 quarter forward indicator for leasing reached its highest level since mid-2022 in September, while the economic growth outlook and employment trends remain constructive, particularly in the U.S., we are increasing our full year revenue growth target to high teens. From mid- to high teens, even while considering the strong growth comparison in prior year fourth quarter. Shifting to our Capital Market Services segment, Revenue growth was broad-based across nearly all major geographies and sectors, led by the U.S. and Japan, despite the rising bond yields late in the quarter. Global investment sales revenue increased 33% and led by the U.S., up 34%, both of which were over 3x the market growth rate of 9% and 11%, respectively. Debt Advisory revenue increased 13% and equity advisory was up 39%. The underlying momentum in our business as well as strength of our talent, full-service capabilities, platform and data advantages are reflected in the 2-year stacked growth rate of 55% for investment sales for 61% debt advisory and 126% for equity advisory. Higher revenue, net of increased commissions, lower loan-related expenses versus prior year, and continued platform leverage drove the adjusted EBITDA growth and margin expansion in the quarter. Looking ahead, we are closely monitoring the implications of higher bond yields. To date, pricing is seen an adjustment with some elongation of decision time lines in select on-market transactions. Still, the underlying longer-term fundamentals, such as economic growth and debt and equity capital flows, continue to support healthy activity levels. Our global investment sales, debt and equity advisory pipeline continues to be robust, most notably in the U.S. While pace of pipeline conversion rates has slightly moderated and being mindful of the strong growth comparables a year ago, we are maintaining our mid-teens revenue growth target for the full year 2026. Turning to Investment Management. Advisory fees were largely steady as growth from $3.5 billion of capital raised over the past 12 months was offset by anticipated lower fees from funds in Asia Pacific. We continue to target low single-digit advisory fee growth for the year as the Asia Pacific headwinds are expected to largely persist through year-end. Additionally, we continue to anticipate full year incentive and transaction fees. Which are subject to client discretion to be around the low end of our historical range. Shifting to free cash flow, balance sheet and capital allocation. Free cash flow in the quarter was largely consistent with the year earlier, bringing the year-to-date total to $174 million. This reflects a $130 million year-to-date improvement and is attributable to higher cash earnings. Considering the strength of our cash flow to date as well as business mix and ongoing initiatives to improve capital efficiency, our free cash flow conversion ratio is trending well above our long-term average of over 80% for the full year. The free cash flow generation drove an improvement in our reported net leverage to 0.5x. With our $3.6 billion of corporate liquidity low leverage and investment-grade balance sheet, we maintain significant flexibility to continue to invest in the business while also returning capital to shareholders. We repurchased $142 million of shares in the quarter, bringing the year-to-date total to $552 million, which is more than 2.5x the full year 2025 amount and reducing our share count by over 3% from a year ago. As a reflection of the value we see in our shares, we intend to imminently enter into a $500 million accelerated share repurchase agreement under our existing repurchase authorization, which had $2.5 billion remaining at quarter end. We expect to complete the ASR, which as of October 23, represented more than 3% of our shares by year-end. In addition, we intend to remain active on our repurchase authorization with the total amount dependent on the operating environment, our outlook and higher return investment opportunities. Our M&A pipeline is active, spanning our entire platform, but we maintain a high bar comparing risk-adjusted returns with share repurchases. We are focused on opportunities that strengthen our scale, competitive advantages and resiliency, drive synergies and generate strong economic returns. Looking through the balance of 2026, we remain encouraged by the underlying momentum in the business, the strength of our pipelines and platform efficiency gains as well as the global economic growth backdrop, particularly within the U.S. though we are mindful of the range of potential scenarios from higher bond yields on our business and the broader macro environment. With the segment revenue growth targets I outlined earlier as a basis, -- we are raising our full year 2026 adjusted EPS target range to $25.20 to $26.30, reflecting 37% growth at the midpoint. The target range contemplates nominal accretion expected from remaining activity on our share repurchase authorization, inclusive of the imminent ASR. Christian, back to you.

Thank you, Kelly. I want to take a moment to talk about interest rates and their impact on our outlook. Here is what we are seeing today based on our real-time proprietary data and life transactions. While bond yields have risen sharply, the interest rate outlook has been well telegraphed and is working through the market in a measured way. Investors are recalibrating their underwriting to adjust for higher borrowing costs and titer credit structures evident in our proprietary credit intensity index, where loan-to-values have moderated from peak levels. As Kelly mentioned, we are seeing price adjustments in select on-market transactions. The deciding factor is the income growth and investor can underwrite to offset the rising cost of capital, which is why U.S. multifamily has been most affected. Our clients are looking to JLL for intelligence and advice. Our integrated and data-driven approach ideally positions us to gain market share in complex environments such as this. As we reflect on the historic fluctuations of property yields over the past 2-plus decades, the most meaningful drivers have remained consistent: dry powder, credit availability and economic growth. To date, the market remains liquid across debt and equity with every lender type active. Brazilian economic growth and strong property fundamentals are allowing the markets broadly to remain active and efficient. The strong majority of financings and transactions are still progressing and closing in some cases, with longer deal time lines. We continue to monitor risks and opportunities in the market environment closely. Against that backdrop, we remain optimistic for the fourth quarter. Our full year outlook is improving, most notably in leasing advisory, where U.S. demand and forward indicators remain strong. Across our other business segments, including Capital Market Services, -- our outlook is in line with the expectations we set earlier in the year despite the rate environment we just discussed. This outlook is reflected in the RAISE 2026 adjusted EPS target range Key outlined which implies 37% growth at the midpoint. The imminent $500 million accelerated share repurchase we announced today reflects our confident outlook. As well as our focus on disciplined full cycle capital allocation. We see significant value in our own shares, amplified by recent rate driven volatility in our share price and we have high conviction in where JLL is headed strategically and financially. Accelerate 2030 is building a more integrated and resilient JLL, and this is 1 way we are backing that conviction with action. To our colleagues around the world, thank you. You have leaned into our Accelerate 2030 strategy, embrace data and AI and adopted innovative ways of working to deliver a strong quarter for our clients. I'm proud of what you are building together. Operator, please explain the Q&A process.

[Operator Instructions] Your first question comes from the line of Anthony Paolone with JPMorgan.

Great. My first question relates to leasing, where it looked like you gained a lot of share in the quarter. Can you give us a sense as to how much of that may have been driven by the data center deals you alluded to? And also, as you think about leasing on a go-forward basis? Do the comps get tougher? And what are you seeing just under the surface in terms of the various property types?

Thanks, Tony. I'll take that one. actually, our leasing performance has been pretty broad-based. So if you look at industrial, if you look at office and if you look at data center included, we've seen strength across all 3, particularly in the U.S. And maybe I'll just walk through each of them briefly. Industrial has been strong in the U.S. but also around the world in pretty much every geography where we participate. We've seen strength in the industrial asset class. And our teams on the ground have been positioned to serve the clients in that asset class. I would say office has been particularly strong in the U.S. We've seen a little bit of softness in some geographies in Europe. But in the U.S., office has been quite strong, including clients in the technology space, AI space, but also professional services and a wide range of applications there. And then data centers are an important part of our leasing mix, but in the third quarter, they were kind of mid-single digits or revenue. So again, important but not the biggest part. You're right. Those deals are bigger, and they tend to be a little bit lump and so that will vary from quarter-to-quarter. But in the third quarter, it was kind of mid-single-digit growth. Just in terms of the outlook to get to that part of your question, we feel good about the underlying kind of drivers of our leasing business. We think we've got momentum going into the fourth quarter. our pipelines look quite strong. Our conversion rates look quite strong. And we're, I think, feeling good about the economic growth prospects, again, particularly in the U.S., which is our most important leasing market.

Okay. Got it. And then my second question relates to REMS -- and I was hoping you can revisit maybe some of the near rates you see out of the various segments of that business line. particularly as it relates to workplace management and kind of how you see that growth rate trending?

Sure. Well, what we have seen in the third quarter is that the workplace management revenue has been up by roughly 10%. And and it was led by a largely balanced mix of mandate expansion and new client wins. And we believe that this is actually accelerating in the fourth quarter. And so we look with a lot of confidence into that business going forward. The other part of that segment, real estate management service is, obviously, our project management business. And there, the revenue on a GAAP basis was up 14%, and this is driven by strong growth in the U.S., but then you have, obviously, some areas in the world which are currently slightly negatively impacted, not least the Middle East, which is a big market for us where growth obviously moderated very meaningfully on the project management side. .

Your next question comes from the line of Stephen Sheldon with William Blair.

First 1 just on higher rates, very helpful commentary in the prepared remarks, Christian. So it sounds like you're seeing a little slowdown in pipeline conversion and capital markets in the fourth quarter. didn't sound to me like it's overly impactful yet. So I guess, is that fair? And then how are you thinking about the capital market setup in the next year, although I know there are a lot of moving pieces -- and then have you seen higher rates have any notable impact on other segments or businesses? Or is it mostly contained from what you can see at this point in capital markets?

Let me start with the last point you were raising. So far, we haven't seen any impact on any part of our other businesses. And frankly, that is what we would have expected because interest rates actually only have a real influence on our capital markets business. Other parts of our businesses are much more impacted by the general development of the economy, how GDP is developing and the confidence level which people have to the coming months. So going back now to Capital Markets. As you have seen in the numbers, we had a very strong third quarter on the capital markets side. The momentum has been incredibly strong. And the fact that we have this disturbance from the interest rate side hasn't really stopped that at a broader level. We have seen some deals where there was a bit of repricing going on. Some deals have been delayed. Some deals have fallen away. But if you -- as you can see from the overall growth in that segment, the momentum is very, very strong, and we believe that momentum will continue in the fourth quarter. With regards to 2027, it's so difficult to make any kind of forecast. This is a very fluid environment. And -- this is just 1 component. Interest rate is 1 component of the capital cost, and we shouldn't underestimate that even with that increase in pricing on the overall capital cost. The question is what people are expecting on the rental level side, whether they believe that they can increase rents going forward, which help them to digest some of that increased cost of capital. And in those areas where there is the least possible at the moment, you see then more impact. So multifamily in the U.S. is more affected by the increase in interest rates than other asset classes so far. So we continue to be very confident about that business. It may not storm ahead as a bit over the last couple of quarters, but we will still see healthy growth going forward.

Understood. Makes a lot of sense. And then as a follow-up, just within Workplace Management, I think you all called out the growth was balanced between mandate expansions and new client wins. So just wondering if you could talk more about what's driving the mandate expansions in the growth profile and whether that is being supported by some of the things you called out in the prepared remarks, like clients consolidating vendor spend holistically and some of the efforts to deepen client relationships. So we just love more detail on those mandate expansions?

Yes. I think it's -- the 2 biggest factors is that -- within the different industries, you have companies who continue to win and take more market share and show very healthy growth. As you know, we have a very strong foothold in the overall technology sector, and many of our clients there are growing at very high percentage levels, and that obviously has an impact on our business with them. And so that is part of the growth we are seeing. And then the consolidation of suppliers is a global trend, and that is also helping us to drive this, what we would call expansion within existing clients that they have that consolidation of their vendors. I was having the last 10 days, I spent a lot of time with different clients. And that was the common theme that they were all working on reducing the numbers of suppliers they have. And -- and that is something where we will benefit from. And frankly, that was part of our Accelerate 2030 analysis that this is a massive growth opportunity for us within our existing clients and within our existing core services.

Your next question comes from the line of Alex Kramm with UBS.

Just wanted to follow up on the kind of early look in 2027 that was just asked about. I know the question was specifically about capital markets. And I appreciate the environment is uncertain. But just from a very broad perspective sitting here today, how do you think about the kind of growth algorithm, the 16% EPS growth that you usually look for through cycles as you think about 2027 with what you can see today on the capital markets side, given that you have opportunities in other businesses?

Well, Alex, -- thanks for the question. This is not an easy 1 to answer. First and foremost, we are focused on finishing 2026 strong. And with regards to 2027 -- we are in the midst of our annual budgeting process, and you will understand that it is way too early to provide a granular outlook on 2027 because we are facing pretty uneven macro environment. And then we have very strong growth comparisons in '27 when we then look back to '26. For now, we are tracking to our adjusted grow in line with our long-term through-cycle average adjusted EPS growth, which we outlined under Accelerate 2030. We have no reason to take that back, but it is too early for us to be more precise. And so we will do that when we talk to each other when we release the fourth quarter numbers, then we will be able to give you a more precise rate for 2027.

Maybe I can -- I was just going to build on that with a couple of maybe additional points. As Christian noted, it is a little early for us to provide granular guidance. But maybe just to give you a sense of how we're thinking about '27. You've heard us talk a lot about resiliency in our business, and we have worked very hard and we continue to work hard to increase the resiliency in our business, both across our resilient and advisory business lines. We do feel good about the economic growth outlook, particularly in the U.S., as I noted earlier, as 1 of our most important markets. . For our resilient business lines, which sit largely within our REMS segment, we do anticipate operating momentum to carry into 2027. The structural tailwinds in that space are good. And we've communicated to you before, we generally expect 50 basis points of margin expansion, give or take, in any given year depending on kind of investment opportunities there. And our leasing and capital markets businesses, while I think the growth will moderate in 2027, just given the very, very tough comps coming out of 2026, the growth rate will moderate. We still expect to see growth in those businesses. And just as a reminder, we typically look for 30% incremental margins in leasing. Again, that can vary year-to-year depending on our investment opportunities in mid-30s in capital markets. Advisory fees and investment management, we would expect to start picking up as fundraising continues to get better. And as that capital gets deployed -- our platform imperative, what Christian spoke about in his opening remarks, is going to be a key source of driving margin expansion, and we're extremely committed to those initiatives. And then I think just the last point that I would make, again, as we're thinking about '27 is that we expect to remain active on our share repurchase authorization following the ASR that we also announced earlier today, we still have $2 billion left on our share repurchase authorization, and we will remain active on that. Again, the specific amount will vary quarter-to-quarter depending on the operating environment and other opportunities that we've got, but we will remain active on it. So while not granular and specific, it gives you a bit of a sense for how we're thinking about '27.

Yes. No. Very much appreciate it. And then just also coming back to the kind of 1 JLL initiatives sounds like you're seeing some positive early impact from that already. So any quantitative perspectives on this, anything in terms of revenue uplift, growth uplift you're seeing that you -- I assume you're tracking this, but yes, just any early color or numbers there?

Well, let me start with saying that after now kind of 9 months, 8 months since our Investor Day, we develop a lot of confidence around that strategy. The focus which we are having on our services and our for clients and potential new clients in the in the Fortune 500 is driving very significant growth potential, selling additional services to them. So -- that is a big reason -- major reason for the confidence we have looking into 2027. With regards to precise numbers, Kelly has already mentioned some. It is obviously always easy to see immediate results on the efficiency side, on the automation side, so what we would call platform efficiencies. That's where we bank a lot of immediate results with regards to top line growth, that is much harder to bring back to a specific initiative. Growth always has many people who participate and claim victory. But as I said, the counting the numbers of services is something which we are very focused on, and that's where we see early traction now that we are selling more services to the same clients. And that is just the beginning. That will be a key driver, the more we are getting into the 2030 accelerate execution. Kelly, do you want to add anything?

I was just going to reiterate the point that Christian made in his opening remarks, which is our platform imperative, which is 1 of our 6 Accelerate 2030 imperatives. We expect to deliver 20 basis points of margin improvement on average per year over the next couple of years from that specific initiative alone, and we've got a very concrete plan with a team that's executing against that. . And to your question about are we measuring it, we're measuring the heck out of it. So we feel very good about that particular lever and what we can deliver and holding ourselves accountable to delivering it.

Your next question comes from the line of Jade Rahmani with KBW.

I had 2 quick follow-ups. Firstly, in capital markets, year-to-date growth is about 25%, and you expect mid-teens for the full year. So based on the 3Q outperformance, this could suggest around flattish growth in the fourth quarter. Does that sound reasonable?

Well, we obviously we'll have much tougher comps in the fourth quarter. When you look back to the fourth quarter of 2025, that was a big quarter for us. And so there is a bit of caution there on the side of the team. And then as I said earlier, the question around the increase in interest rates is something which makes it a bit more unpredictable. So let's say, our forecast is probably a bit on the cautious side. But overall, -- we have still very, very strong momentum and a lot of confidence that most of those deals will close in line with the time line, which they were planned for, so in line with the fourth quarter and not too many deals will fall over into the first quarter.

Just as a reminder, we had a very strong fourth quarter and prior year in our capital markets business. Our growth rate was in kind of the mid-20s percent range in 2025 4th quarter. And so as Christian noted, we are contemplating a range of scenarios for fourth quarter in our capital markets business, you are right, a little bit modulated growth relative to what we have seen year-to-date, but it is largely due to the fact that we had a very strong fourth quarter here prior.

Okay. follow-up on data center leasing Tony's question, you said mid-single-digit percent of revenue. And then you also said later mid-single-digit growth, which seems not sure if that part is correct. But the question is how much of the segment's 27% year-over-year growth in leasing related to data centers. If you could help contextualize what it would have been ex the data centers? And maybe if you could give some color as to like what the pipeline for data center leasing looks like if you expect this to continue?

Yes. So let me just clarify my comments from earlier. Our growth in leasing has been broad-based across industrial, across office, across data centers. Data centers contributed mid-single digits to our total revenue in the third quarter. The growth rate is strong, albeit off of a small base. And we expect that to be a bit lumpy from quarter-to-quarter just because the deal sizes tend to be on the larger side. And so in any given quarter, it could vary. But in the third quarter, it contributed 5% to our total revenue, about 5% mid-single digits to our total revenue.

Okay. So the remaining question is what it was a year ago. What was the 5% a year ago? Was it 1%, 2% or 0%?

It is definitely up relative to a year ago, consistently year-to-date as well as in the quarter.

Your next question comes from the line of Julien Blouin with Goldman Sachs.

I just wanted to return to the Accelerate 2030 plan. It sounds like Christian, the encouraging early progress is really underway. I appreciate the fluid environment within capital markets, but is it fair to say that as we think about the other building blocks, the leasing long-term target of mid-high single digits with 30% incremental margins, REMS in the high single-digit sort of revenue growth range. that those pieces still feel pretty intact despite the moves that we've seen in interest rates?