- Jun 28, 2013
Innovator Lauralee Martin Targets Further Growth for Jones Lang LaSalle’s Powerful Americas Unit
By Paul Rosta, Senior Editor
After 10 years of roaming the globe on behalf of Jones Lang LaSalle Inc., Lauralee Martin may finally have a little less jet lag in her future. Martin has traveled tirelessly throughout the world as the firm’s CFO since 2002 and COO since 2005. Her new assignment may eventually reduce the number of time zones she visits, but it will hardly mean less time in the spotlight. As CEO of Jones Lang LaSalle’s Americas region, Martin oversees the company’s most powerful revenue generator, one that spans eight countries on two continents, with 80 offices and some 16,000 people.
To be sure, expectations are high for Martin in the high-profile role, which she assumed on Jan. 1. In no small measure, those expectations stem from the track record of her predecessor, Peter Roberts, who now holds the newly created position of chief strategy officer at the global level. During a decade at the helm, Roberts steered the region through an era of historic expansion, a harsh economic downturn and muscular growth. In 2012, Roberts’ valedictory year, the Americas region registered a tidy 15 percent year-over-year increase in revenue, reaching $1.7 billion. That total easily outpaced the $1 billion tallied by the runner-up Europe-Middle East-Africa region.
Martin, however, is up to the challenge, bringing a long track record of innovation and company growth to her new role. She joined Jones Lang LaSalle in 2002 after 16 years at Heller Financial Services Inc., where her duties included serving as CFO during the company’s initial public offering and sale to GE Capital three years later (see “Embracing Change” at left). At Jones Lang LaSalle, she has been instrumental to maintaining the company’s solid financial foundation, expanding its services, broadening its footprint and sparking robust revenue growth.
In 2012, Jones Lang LaSalle’s worldwide revenues reached $3.9 billion, a 12 percent year-over-year increase. That total reflects a 63 percent increase since the depths of the recession in 2009. After both the most recent downturn and the one following the Sept. 11, 2001, terrorist attacks, Martin worked to place the company on a sound financial footing that set the stage for record growth. Since adding the COO’s role, she has championed signature initiatives in technology, sustainability and diversity.
Associates describe her as an eagle-eyed talent scout, a decisive yet good-humored leader and a tireless worker. “She really is a 24/7 person,” said David Gold, a senior analyst with New York City-based Sidoti & Co. “I’m jealous of the amount of energy she has,” admitted Gold, who at 38 is a couple of decades Martin’s junior.
Responsiveness, too, is a Martin trademark. In her combined roles as CFO and COO, “she was always very busy, always traveling around the globe,” Gold noted. Despite the grueling schedule, she would unfailingly respond to his requests for information. “It wouldn’t matter if she were in an airport in Hong Kong running for the plane, she would still call. Things were not falling off her plate.”
She is also something of a trailblazer as the first woman to be named CEO of a major U.S. real estate services company. Even if Martin and her colleagues are low key about the milestone her appointment represents, its significance is not lost on observers. “You can rest assured that any organization that deals with the company noticed it,” declared Martin’s friend Collette English Dixon, the 2011 national president of Commercial Real Estate Women and a Chicago-based principal for Prudential Real Estate Investors. She regards Martin’s appointment both as a laudable step forward and as a reminder of the long road to true parity that remains ahead: “It will be a great day for the industry, and a sign of real progress, when we no longer need to single out an achievement such as Lauralee’s as unique or a first because of gender.”
In her new role, Martin looks to build on the company’s diversified services platform in the United States and throughout the Americas. “One of the things we were very proud of was that leasing overall in the industry was down 20 percent and we were up 9 percent” in revenue last year, she noted.
As examples, she cites several business lines where she contends the company is poised to take advantage of stepped-up demand. “We have invested very heavily for the last four years in building our U.S. capital markets capabilities, particularly in multi-family,” she noted. In that time, Jones Lang LaSalle has added some 60 multi-family specialists nationwide. That investment is paying off in deals like the sale of Archstone Crystal Towers, a 914-unit luxury high-rise in Arlington, Va.
Represented by managing directors Al Cissel and Scott Melnick, Equity Residential sold the asset to Dweck Properties in April for $332 million, believed to be the richest price ever commanded by a multi-family asset in metropolitan Washington, D.C. Crystal Towers capped four recent multi-family transactions recently orchestrated by Cissel and Melnick in metro Washington for an aggregate $608 million.
Jones Lang LaSalle brokers also wrapped one of the country’s biggest trophy hotel sales of early 2013. Robert Webster and Tim Southard of the firm’s hospitality practice represented Host Hotels & Resorts in its $293 million sale of the Atlanta Marriott Marquis. The buyer of the 1,663-key property has since been identified as Black Diamond Inc., an affiliate of the Abu Dhabi Investment Authority.
In facilities services, Martin is eyeing healthcare-related opportunities. She cites the company’s 2011 assignment to handle Beaumont Health System’s 8.5 million-square-foot portfolio in Metropolitan Detroit as an example. Then known as Beaumont Hospitals, the healthcare network tasked Jones Lang LaSalle with trimming real estate costs that typically account for 30 to 40 percent of operating expenses.
Jones Lang LaSalle manages a portfolio that includes Beaumont’s hospitals in Grosse Pointe, Troy and Royal Oak, Mich., as well as more than 100 patient care and business offices. Taking the place of Beaumont Hospitals’ in-house facilities group, the real estate company handles services ranging from facilities management and utility operations to lease administration and biomedical equipment maintenance. Also in 2011, it teamed up with Pacific Medical Buildings to provide strategic planning, development and financing services for healthcare facilities, particularly medical office buildings.
Martin did not reveal any current plans for acquisitions in the Americas, but observed, “We’re definitely in a consolidating industry.” The company is approached constantly about mergers, especially by specialty firms that pitch themselves as a good fit with the company, she reported. Jones Lang LaSalle has a broad footprint in the region, particularly in the United States. As a rule of thumb, she explained, “we believe it’s important to be one of the top three service providers in each of the top markets” where clients are located.
Two Steps Ahead
To the company’s wide-ranging Americas platform, Martin brings both a first-class temperament and a first-rate mind. “She’s one of the smartest C-suite executives I’ve ever met,” Gold said. “She’s always one step ahead of me, and usually it’s two steps.”
Gunnar Branson, president & CEO of the National Association of Real Estate Investment Managers, observed that Martin combines sharp analysis with an insatiable appetite for information and a respect for colleagues’ ideas. “She’s always been the smartest person in the room, but she’s not someone who needs to let you know,” he said. “Because her ego is not getting in the way, she’s able to spend time listening and giving people the time to say what they mean.” In the best, scientific sense of the word, Branson added, Martin is also a skeptic. “Her style is to say, ‘You’ve asserted this—how do you prove it? What is the data?’”
Along the way, she has also earned a reputation for being one of the industry’s most approachable senior executives. In 2011, English Dixon called Martin’s office, hoping to meet with her to discuss the Urban Land Institute’s recently launched Women’s Leadership Initiative. English Dixon was unsure whether her outreach would bear fruit, and was gratified when Martin quickly took her up on the invitation. “It was amazing to me that I didn’t have to go through three gatekeepers, and that she was so willing to find time to talk with me.” Since that initial lunch meeting, Martin has become a valued mentor, confidante and friend.
At Jones Lang LaSalle, Martin has repeatedly addressed the challenges posed by paradigm shifts in technology, global competition and abrupt economic swings. When she joined the company as CFO, it was grappling with the downturn that followed the Sept. 11, 2001, terrorist attacks. By the third quarter of that year, the company was obliged to revise its earnings guidance downward; all told, global revenues for 2002 declined 7 percent to $840 million. Over the next few years, Martin put in place a wide-ranging strategy to strengthen the company’s finances—trimming operating costs, managing debt and tax rates and maintaining high scores from the rating agencies. During her first year alone, the strategy cut costs by more than $50 million; the following year, the company paid down its credit facility by $38 million.
During her seven years as COO, Martin has provided backing and financial support for the company’s embrace of innovative technology. In 2011, it unveiled IntelliCommand, a proprietary facilities management platform that it touts as the industry’s first integrated building management solution to combine cloud-based, smart-building technology with round-the-clock, real-time remote monitoring and control of facilities and portfolios worldwide.
Employing technology from Pacific Controls, the platform performs a process of continuous commissioning. IntelliCommand remotely monitors and analyzes data in real time, then makes adjustments to maximize operating efficiency, particularly in energy use. Last year, the platform received Realcomm’s annual award for best use of automation in real estate facilities.
As COO, Martin was an early champion of sustainability. During the movement’s early stages, “we said, ‘We could be leaders, change the industry and make sure our clients’ buildings operate at the top level of efficiency,” Martin recalled. “Our clients expect it now, and tenants expect it, too, or else their buildings would not be competitive.” Today, the company counts more than 1,250 LEED-accredited professionals globally, the most in the industry. “We have an expectation that our project managers, our property management people, our engineers get LEED accreditation,” she emphasized. “Training and qualifying our people ensures that they receive LEED accreditation and know more about the process than anyone else.” Assessing the industry’s overall performance in sustainability, she noted that short-term thinking about investing in green measures remains widespread, “but in operations, (there’s a recognition) of a long-term benefit.”
Diversity, too, has become a company hallmark, woven into its culture in a number of ways. Officially recognized affinity groups offer networking, mentoring and professional development opportunities for women, people of diverse ethnic backgrounds, and gay, lesbian and transgender employees. Senior management representatives regularly participate in their events. In a telling achievement, the company was the sole real estate firm on Diversity MBA magazine’s roster of the top 50 companies for diverse real estate managers.
Last October, Jones Lang LaSalle organized its second annual Women’s Summit, which brought together 60 of the company’s top women to Dallas for two days of networking, panel discussions and professional development workshops. The agenda included career challenges and solutions, personal “branding” strategies and recruiting. Global president & CEO Colin Dyer addressed the attendees, as did three locally based CEOs: Pam Patsley of Moneygram, Colleen Walker of Girl Scouts USA and Elaine Agather of JPMorgan Chase’s Dallas region.
As new trends in technology, sustainability, diversity, capital markets and other areas shape the real estate industry, perhaps the overarching task for CEOs is identifying strategies for change. Martin, who embodies part of that transformation, is in the right role at the right time, according to Branson. With her thirst for knowledge, eye for innovation and openness to the ideas of others, he observed, “She’s very well suited to make change happen—and make the appropriate level of change.”
The ultimate test for a leader, Branson argues, is implementing change in a way that promotes growth. Lauralee Martin, he says, “is ideally suited to striking that balance.”