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Jones Lang Subsidiary Seeks Funds

Zacks Equity Research

According to insider sources familiar with the situation, LaSalle Investment Management Inc. -- the property-fund unit of Jones Lang LaSalle Incorporated (JLL) -- a leading real estate investment trust (:REIT), is seeking to raise capital worth $700 million for an Asia-Pacific property fund.

The strategic move is aimed to capitalize on the solid growth projection in the region, which is slated to grow by about 6% in 2012 according to the conservative forecast of the International Monetary Fund. Earlier in 2011, investments in Asia-Pacific commercial property increased by 13% to become the world’s second largest investment haven, as cited by a report from property broker DTZ.

Buoyed by this strong growth dynamic, LaSalle Investment has already acquired an industrial asset in China and an office property in Japan to seed the new investment vehicle titled Asia Opportunity Fund IV. Unconfirmed reports suggest that the fund would seek industrial properties and hotels in Australia and China, retail properties in Australia, industrial assets and offices in Japan, and higher-return housing in select cities in China.

Managing a portfolio of $47.2 billion of private and public property equity investments, LaSalle Investment is one of the world’s leading real estate investment managers. The company operates as an independent subsidiary of Jones Lang LaSalle.

Chicago-based Jones Lang LaSalle is a full-service real estate services firm that provides corporate, financial and investment management services to corporations and other real estate owners, users, and investors worldwide. A broad real estate product and service range, and extensive knowledge of domestic and international real estate markets, enable the company to operate as a one-stop provider of real estate solutions.

Jones Lang continually invests in industry-leading research to identify emerging trends and anticipate future conditions to respond to the shifting market and business trends of its clients. This enables the company to develop new investment products and services tailored to the specific investment goals and objectives of its clients, thereby maintaining profitable long-term relationships during challenging market conditions.

We maintain our Neutral rating on Jones Lang, which presently has a Zacks #1 Rank that translates into a short-term Strong Buy rating. However, we have an Outperform recommendation and a Zacks #3 Rank (short-term Hold rating) for CBRE Group, Inc. (CBG), a competitor of Jones Lang.

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