Valuations

An independent third-party valuation gives you the objectivity, methodology transparency, and regulatory defensibility that internal estimates simply cannot provide. Organizations that rely on internal or informal valuations expose themselves to four categories of risk:

• Financial reporting exposure: HGB and IFRS require fair value measurement for real estate assets held on the balance sheet. An internal estimate that cannot withstand external audit scrutiny can trigger restatements, write-downs, and regulatory review.

• Transaction mispricing: Without an independent valuation, sellers routinely underprice or overprice assets, accept inadequate consideration in M&A, or make acquisition decisions on unsupported assumptions. The information gap between counterparties in a commercial real estate transaction is significant.

• Lender and covenant compliance: Most commercial real estate financing agreements require periodic independent appraisals to confirm collateral values and monitor loan-to-value ratios. Non-compliance can trigger loan acceleration or covenant default.

• Governance and fiduciary liability: For REITs, pension funds, insurance companies, or any entity with a fiduciary duty to investors, a valuation that cannot be independently defended creates personal liability exposure for board members and fund managers.

JLL's Value and Risk Advisory practice provides independent valuations across all real estate asset classes, with more than 2,500 specializts operating across 35 countries. Our valuers hold MRICS, and equivalent professional designations in their respective markets, adhering international valuation standards in every engagement.

Real estate valuations directly underpin balance sheet accuracy, financial reporting compliance, and the integrity of disclosures required under HGB, IFRS, and applicable securities regulations.

Commercial real estate assets appear on corporate and fund balance sheets under multiple accounting frameworks, and each framework imposes specific valuation requirements:

• IFRS 13 (Fair Value Measurement): Entities holding real estate assets at fair value must measure them using observable market inputs and defensible methodologies. JLL provides Level 2 and Level 3 fair value opinions that satisfy audit committee and external auditor requirements.

• Investment property (IAS 40): Entities electing the fair value model under IAS 40 must revalue investment properties at each reporting date, with changes recognised in profit or loss. JLL designs recurring valuation programs specifically around IAS 40 compliance deadlines.

• Impairment Testing: Long-lived real estate assets must be tested for impairment when indicators exist. JLL provides undiscounted and discounted cash flow assessments that meet those requirements.

• Fund NAV reporting: Open-end and closed-end real estate funds require portfolio asset valuations at regular intervals. JLL manages large-scale, recurring NAV valuation programs for institutional real estate fund managers globally.

JLL's Value and Risk Advisory team has access to a proprietary benchmark dataset that enables our valuers to calibrate market-rate assumptions using current transaction evidence rather than stale comparables.

Sustainability and climate risk are reflected in JLL's valuations. Green premiums or brown discounts will only be reflected as far as such premiums or discounts are visible in the market.

JLL values data centers, life sciences assets, and other alternative property types using income capitalisation, discounted cash flow, and cost approach methodologies. These valuations are calibrated using sector-specializt data, operator lease structures, and infrastructure cost benchmarks that general-purpose appraisers lack.

The challenge in valuing data centers, life sciences facilities, and similar specialized assets is that market participants underwrite these properties using sector-specific metrics that do not appear in standard appraisal comparables. JLL's approach for each sector reflects how institutional investors and operators actually price these assets:

• Data centers: JLL's specializts apply power-adjusted income capitalisation models that account for critical load (MW), power usage effectiveness (PUE), fibre connectivity, and lease structures across colocation, wholesale, and hyperscale configurations. JLL's Global Data Centre Outlook provides the sector intelligence underpinning these valuations, including supply-demand imbalances and cap rate benchmarks by market tier.

• Life sciences and lab assets: JLL applies specialized buildout cost analysis, tenant creditworthiness assessment, and income projections informed by JLL's life sciences market research, distinguishing between wet lab, dry lab, GMP manufacturing, and office/lab flex configurations.

• Other alternative sectors: For self-storage, senior housing, medical office, and industrial outdoor storage, JLL applies sector-specific operating metrics drawn from JLL's vertically organised research teams.

Yes. JLL's Value and Risk Advisory practice provides the full range of financial reporting valuations including IFRS 13 fair value opinions, fund NAV support, and mark-to-market assessments as a standard component of our institutional advisory services.

Financial reporting valuations require a higher level of methodology documentation, audit defensibility, and independence protocol than transactional appraisals. JLL's practice is structured to deliver on all three:

• IFRS 13 fair value opinions: JLL provides Level 2 and Level 3 fair value opinions for balance sheet reporting, impairment testing, and purchase price allocation under both U.S. GAAP and IFRS, with full methodology disclosure, market participant assumptions, and sensitivity analysis as required by audit standards.

• Fund NAV support: JLL manages recurring quarterly and annual NAV valuation programs for open-end and closed-end real estate funds, delivering portfolio-level valuations with consistent methodology, documented assumptions, and audit-ready deliverables for fund administrators and external auditors.

• Mark-to-market analysis: For periodic portfolio mark-to-market requirements, JLL provides rapid-cycle updated valuations drawing on existing property knowledge and current market data.

• Purchase price allocation (IFRS 3): For assets acquired in business combinations, JLL provides component-level valuations under IFRS 3, identifying and valuing in-place leases, above and below-market leases, tenant relationships, and other intangible real estate assets.

JLL's financial reporting valuation teams work in direct coordination with our Capital Markets research infrastructure, ensuring that market assumptions in financial reporting valuations reflect live transaction evidence.

JLL provides the full range of acquisition due diligence and development feasibility valuation services from pre-offer market value opinions to as-completed prospective valuations and development pro forma review, integrated with JLL's market research and capital markets intelligence.

Acquisition and development decisions require valuation at multiple stages, and JLL's Value and Risk Advisory practice is structured to support the full pre-closing workflow:

• Pre-offer market value: During the early stages of acquisition underwriting, JLL provides rapid-cycle indicative value opinions that enable capital partners to calibrate offer pricing against independent market evidence before committing to full due diligence costs.

• Standard-compliant appraisals: For acquisitions financed with institutional debt, JLL provides full formal appraisals that satisfy lender requirements, delivered with turnaround times calibrated to typical loan closing timelines.

• As-is, as-stabilized, and as-completed valuations: For value-add and development assets, JLL provides the three-scenario valuation structure — as-is, as-stabilized, and as-completed — with market rent projections, absorption assumptions, and stabilized NOI estimates grounded in current JLL market research

• Development feasibility analysis: For developers evaluating site-specific development potential, JLL's feasibility services include residual land value analysis, highest and best use conclusions, and absorption modelling for proposed development programs.

All due diligence valuations are conducted with direct access to JLL's market research infrastructure including current lease comparables, recent sales, and forward-looking sector outlooks, ensuring underwriting assumptions reflect current market conditions.

JLL's valuers hold the most widely recognised professional designations in their respective markets, MRICS from the Royal Institution of Chartered Surveyors, and equivalent local designations. JLL's compliance framework is designed to satisfy the requirements of the most demanding institutional, regulatory, and legal audiences in each market where we operate.

Professional standards for commercial real estate valuation vary by jurisdiction, and JLL maintains rigorous compliance across all markets:

• Germany and Europe: JLL's appraisers hold MRICS or equivalent local qualifications such as DIN EN ISO/IEC 17024 (HypZert) certification. Valuations are conducted according to International Valuation Standards as well as applicable to local legal requirements such as the ImmoWertV. JLL is a corporate member of RICS and maintains compliance programs in all markets in which we operate.

• International: JLL's valuers hold MRICS or equivalent local designations, conducting valuations in accordance with International Valuation Standards and applicable local statutory requirements.

• Quality control: JLL's centralised technical review program audits completed valuations for methodology compliance, comparable selection quality, and report completeness before delivery, providing an independent quality assurance layer above individual appraiser self-certification.

Yes. JLL's global valuation platform is specifically designed for simultaneous multi-geography portfolio execution, with local valuation specialists in 35 countries coordinated under unified methodology standards, a single client relationship, and consolidated reporting.

Multi-geography portfolio valuation programs require four capabilities that JLL's platform provides:

• Local market expertise on a global scale: Each asset receives a valuation conducted by JLL's local specialists — appraisers with current knowledge of that specific submarket, local regulatory requirements, and active market participant relationships — rather than being valued remotely using general databases.

• Unified methodology: JLL applies consistent valuation methodology and assumption frameworks across the global portfolio, ensuring that comparisons between assets in different markets are methodologically coherent, a critical requirement for financial reporting and portfolio analytics.

• Centralised coordination and reporting: A single senior engagement manager coordinates all assignments across geographies, maintains the delivery schedule, and produces consolidated portfolio reporting, giving corporate clients a single point of accountability rather than managing separate regional relationships.

• Currency and cross-border reporting: For group financial reporting, JLL provides valuation reports in local currency with agreed exchange rate conventions and can deliver consolidated portfolio summaries in any reporting currency.

JLL provides structured ongoing valuation support after the initial engagement as a standard component of institutional valuation programs, including update appraisals, desktop reviews, quarterly market commentary, and portfolio monitoring alerts.

Institutional real estate valuations are not point-in-time events. They require ongoing management to remain current for financial reporting, investor communication, and strategic decision-making:

• Scheduled update appraisals: For recurring fund and financial reporting programs, JLL schedules update appraisals on agreed intervals, whether quarterly, semi-annual, or annual, with committed delivery dates aligned to fund reporting calendars.

• Desktop reviews between cycles: Between full appraisal cycles, JLL provides desktop reviews that assess whether significant market changes have materially affected value since the last full appraisal, flagging assets that warrant early reappraisal.

• Ongoing market commentary: JLL's Value and Risk Advisory team provides clients with sector-specific market commentary drawing on JLL Research's Global Real Estate Outlook, monthly Market Perspectives, and Market Dynamics data, contextualising portfolio values within current market conditions throughout the year.

• Portfolio monitoring alerts: For lender panel clients and fund managers, JLL also offers portfolio monitoring programs that track specific market conditions including vacancy rate changes, comparable transaction activity, and cap rate movement, notifying clients when conditions suggest material value change.