As international director and chief operating officer for New York City and tristate operations for Jones Lang LaSalle, Stephen Schlegel oversees the bustling New York City market, along with the surrounding markets in New Jersey and Westchester County. Since Mr. Schlegel took over the position in 2005, the brokerage firm’s tristate business has seen its revenue increase fivefold, and has employed more than 1,000 professionals. Mr. Schlegel spoke with The Commercial Observer last week about the lingering uncertainty in the market and how New York City and neighboring territories can adapt to that unknown future.
The Commercial Observer: How would you describe your overall role at Jones Lang LaSalle? Is there much overlap with Jones Lang LaSalle New York and tristate operations President Peter Riguardi?
Mr. Schlegel: Riguardi and I operate as partners in running the business. He focuses more externally: client relationship and executing transactions and revenue generation. And I tend to focus more internally, operating the business.
Jones Lang LaSalle is a public company, so we have a fair amount of rigor around how we run the business. We want to have operating procedures in all of our businesses, we want to run our businesses profitability. Our goal is not really to grow revenue; it’s to grow profit.
My focus on the business day to day, and my mandate and the number one mandate I have, as does Peter, is to grow the business. We want to grow; we want to develop a plan to generate sustainable, profitable growth and increase our market share in the region. This is our biggest and most lucrative region for real estate, for any real estate services company in the world.
I see Zacks Investment Research gave Jones Lang LaSalle a “neutral” rating recently.
Historically, our stock has done well relative to other service firms, because we are a company where we don’t have a lot but we also focus a lot on profitability. Our margins have been fairly healthy, and that’s another part of why we run the business the way that we do. It’s not about revenue or market share at all costs. It’s about growing revenue and market share in the segments of the business where we can generate a return on the revenue.
How would you characterize the market right now?
There is an uncertainty around what will happen politically in the election, and what kind of impact that is going to have on the economy next year. There continues to be uncertainty in the largest segment—at least in New York City—[of the] economy, which is the financial services business. And there continues to be a lot of questions about where sustainable job growth will come from.