Former banker Christian Ulbrich is taking over the top job at the EMEA division of Jones Lang LaSalle. The reserved German will have his work cut out filling the larger than life shoes of his predecessor. And with recession biting, he will have to start with some tough decisions. By Penny Guest.
It’s tempting to make a few comparisons between Christian Ulbrich and Gordon Brown. First, they each had a charismatic boss who was successful when the economy was strong. Second, just as the top job became theirs, markets everywhere started to tank. And third, it seems Ulbrich, like Brown, comes into his own when the going gets tough.
However, while the public can ultimately vote to replace the prime minister, the 3,900 staff in Jones Lang LaSalle offices in Europe, the Middle East and Africa will have no such luxury if they do not like the messages coming from the 42-year-old ex-banker. He steps up from his position as head of JLL’s German business to take over next January from jovial Scotsman and man of the people Alastair Hughes, who is heading to Singapore to take charge of JLL Asia Pacific.
“The world was shiny when I accepted the role and now it’s gloomy,” says Ulbrich, sitting in a bright red chair in JLL’s Hanover Square headquarters. “The most pressing issue is to ‘right size’ the business to the expectations we have of 2009. It will be tough straight away, and we don’t have a big balance sheet. It’s not about being friendly or having friends within the company. What has to be done has to be done.”
That sounds hard, especially if you’re one of the further 30-40 people that JLL this week told it would be making redundant. Even for those who keep their jobs, the next couple of years look bleak at a firm which traditionally pays relatively low wages with bonuses on top worth around 100-300% of salary. But bonuses are only paid when times are good. Both staff and the firm’s competitors see one of Ulbrich’s main tasks as new chief executive of the 60 corporate offices spread across Europe and the Middle East (but not Africa) to be maintaining morale and the culture of the people business.
Ulbrich however, is brisk on that subject. “JLL employs the smartest people in our industry and part of being the smartest is also being realistic. The mood is not one of gloom. People are concerned not about their business but what’s happening to property overall.”
Nevertheless, the division’s takings are a long way from the hot numbers unveiled last January, when EMEA could report that its profits had doubled to £45.5m, outperforming all JLL’s other business units. On the back of those results, Alastair Hughes took home a bonus of £2.3m, which caused “quite a lot of dissent lower down the pecking order”, according to one insider. Compare that with the gloomy news last week, when JLL as a whole – the world’s second-largest property services firm – revealed a 68% drop in third-quarter profits to £9.4m.
But if you’re starting to feel sorry for Ulbrich’s earning potential, don’t bother. A stellar career path in banking and real estate finance culminated with a short spell of just three years for JLL in Frankfurt, where he handled a €2bn portfolio sale in a rising market. That deal earned his team, according to one staff member, “the biggest ever fee seen in JLL, just eye-watering”.
Ulbrich is not well known in the UK but those who know him highlight just how different he is from the “uniquely accessible” Hughes. “The wonderful thing about Alastair,” reminisces one, “is that he’s not the sort of person you’d have thought would get the job – he says exactly what he thinks.”
Ulbrich, however, is exactly the kind of guy you’d tip to run a top consultancy. Slim (he plays tennis and swims a lot), a good head of brown hair, crisp white shirt and unobtrusive suit, and not even a pair of outré socks to disturb the image. More importantly, those at the top believe he is the right man for the job. “Fair and loyal with staff” ”highly intelligent, commercially very savvy, very success-driven” “well-connected internationally and known for his discretion” are just some of the comments directed his way.
The worst that emerges is that he’s not a great socialiser: “He won’t be your biggest drinking buddy. No, not the kind to take you down the pub for a chat.” Ulbrich himself admits to being more of an Expo Real than a Mipim kind of guy.
He was not expected to go into banking or property. But instead of taking over the family timber merchant, he gained an internship at a local bank, which led him to a career in finance: economics at Hamburg University, Allianz Insurance in London and spells in international commodity markets for Rabobank Nederland and MeesPierson.
His reputation as a tough management fixer was first made when, at the tender age of 28, he was asked to become CEO of the 140-strong, privately owned Bank Companie Nord in Kiel in northern Germany, which was sold for a huge profit after just two and half years. As a result, in 1997, he was asked to perform another turnaround job, this time on the real estate business of MM Warburg, Hamburgische Immobilien Handlung, which, at the time had €4bn of assets under management and 170 staff but which had become overexposed to closed-ended funds. Despite offers, he never returned to the banking world after that.
“I really liked real estate. There was a lot of entrepreneurial space for me to operate in. HIH was a heavy loss maker when I joined and a huge profit maker when I left. It was lots of fun and part of the profits went to me,” he smiles. “Also, I’d made a career doing things that are unpleasant and taking tough decisions. Now for the first time for years I was running a well-performing business and not laying off people or closing things down but developing – it was important to learn not always to be Mr Nasty.”
So why jump ship to JLL? Interestingly, what first brought the firm to Ulbrich’s attention was the way it handled a local scandal in 2003, when country head Douglas Holoch was sacked on corruption charges.
“I went into a board meeting of HIH with a newspaper article about JLL. I told my colleagues to read it. I said: ‘This company is in deep trouble but the way its bosses are dealing with it is the most excellent thing I’ve seen.’ They were completely open, and removed the guy immediately, which wasn’t the way other firms would have dealt with it in Germany at that time. Then two weeks later, I got a call from a headhunter asking if I was interested in a job at JLL.”
Unimpeachable credentials
That kickstarted a two-year courtship for JLL, which was looking for someone with unimpeachable credentials to put the shine back on its reputation. Ulbrich says it was the chance to get back to working internationally after a decade with local German companies that made him take up the offer. Now, after just three years there, his record has been impressive – revenues have tripled, and a 53% year-on-year increase was achieved in 2007 four offices have been opened to take the total to 10 and there has also been the high-profile acquisition of Kemper’s Group. But his proudest achievement, he says, is restoring JLL’s reputation from its low ebb.
Now he’s stepping into the top European job at JLL, staff and competitors are wondering which of the 26 EMEA countries will be home to his desk. He is currently planning to spend Monday and Tuesday in London, one day of the week in Germany and the remaining days elsewhere.
He says his wife and three children would love to move to the UK. “Of course, they’d be happy, who wouldn’t? My son thinks the UK’s cool and my daughter wants to shop in London because there’s no Abercrombie outlet in Frankfurt.”
Ulbrich insists his arrival will see a “fluid” handover of the reins from Hughes to himself. He is, however, adamant that JLL will grow its market share relative to rivals, and offset the severe downturn in revenues from capital markets by shifting service focus: “A year back it was about sales processes and getting the right prices, now it’s about how we operate a building and guide it through the cycle it’s more advisory and consulting. Of course, we will run the company for profits, not turnover.”
One question often asked concerns the £23m which JLL paid to buy retail agent Churston Heard in July. “If you’re UK-based,” says a competitor, “you tend to get drawn into giving London a lot of rope – but he’ll have a very different relationship. It will be easier to ‘right size’ with Alastair away than with him here. The word on the street is that Churston Heard needs to be managed hard.”
Naturally, Ulbrich gives the on-message answer. “We have a strong management team in England – if something needs to be integrated or has issues to solve, they will solve it. Things that have to be done would have been done in the same way by Alastair.”
So the final question is – how long will such an ambitious man stay? A colleague admits: “He probably wanted the top job. It won’t be smooth sailing now he’s got it, but if and when he goes he’ll make damn sure that he’s left a strong legacy behind him.”
