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Business Segments
 9 Months Ended
Sep. 30, 2016
Segment Reporting [Abstract]  
Business Segments
4.
BUSINESS SEGMENTS
We manage and report our operations as four business segments:
The three geographic regions of RES including:
(1) Americas,
(2) Europe, Middle East and Africa ("EMEA"), and
(3) Asia Pacific;
and
(4) LaSalle, which offers investment management services on a global basis.
Each geographic region offers our full range of real estate services, including agency leasing and tenant representation, capital markets and hotels, property management, facilities management, project and development management, energy management and sustainability, construction management, and advisory, consulting and valuation services. We define "property management" to mean services we provide to non-occupying property investors, "facilities management" means services we provide to owner-occupiers. LaSalle provides investment management services to institutional investors and high-net-worth individuals.
Operating income represents total revenue less direct and allocated indirect expenses. We allocate all indirect expenses to our segments, other than interest and income taxes, as nearly all expenses incurred benefit one or more of the segments. Allocated expenses primarily consist of corporate global overhead, which we allocate to the business segments based on the budgeted operating expenses of each segment.
For segment reporting, we present revenue net of gross contract costs in our RES segments. Excluding these costs from revenue and expenses results in a "net" presentation of "fee revenue" and "fee-based operating expenses" that we believe more accurately reflects how we manage our expense base and operating margins. See Note 3 for additional information on our gross and net accounting policies. In addition, our measure of segment operating income excludes Restructuring and acquisition charges.
The Chief Operating Decision Maker of JLL measures the segment results net of gross contract costs and excluding Restructuring and acquisition charges. We define the Chief Operating Decision Maker collectively as our Global Executive Board, which, as of September 30, 2016, was composed of our Global Chief Executive Officer, President, Global Chief Financial Officer, the Chief Executive Officers of each of our four business segments, and the Chair of the Global Corporate Solutions Board.
Summarized financial information by business segment is as follows.
 
Three Months Ended September 30,
Nine Months Ended September 30,
(in millions)
2016
2015
2016
2015
Real Estate Services
 
 
 
 
Americas
 
 
 
 
Revenue
$
771.1

639.4

$
2,047.5

1,791.0

Gross contract costs
(52.6
)
(52.2
)
(144.8
)
(158.0
)
Total fee revenue
718.5

587.2

1,902.7

1,633.0

Operating expenses:
 

 

 

 

Compensation, operating and administrative expenses
686.9

566.7

1,848.9

1,606.9

Depreciation and amortization
22.9

15.6

60.2

46.5

Total segment operating expenses
709.8

582.3

1,909.1

1,653.4

Gross contract costs
(52.6
)
(52.2
)
(144.8
)
(158.0
)
Total fee-based segment operating expenses
657.2

530.1

1,764.3

1,495.4

Segment operating income
$
61.3

57.1

$
138.4

137.6

Equity earnings
0.1

4.5

0.8

5.4

Total segment income
$
61.4

61.6

$
139.2

143.0

 
 
 
 
 
EMEA
 
 
 
 
Revenue
$
522.7

447.0

$
1,373.4

1,189.1

Gross contract costs
(146.2
)
(114.1
)
(407.3
)
(276.0
)
Total fee revenue
376.5

332.9

966.1

913.1

Operating expenses:
 

 

 

 

Compensation, operating and administrative expenses
511.6

413.8

1,338.4

1,116.0

Depreciation and amortization
8.0

6.8

23.8

18.1

Total segment operating expenses
519.6

420.6

1,362.2

1,134.1

Gross contract costs
(146.2
)
(114.1
)
(407.3
)
(276.0
)
Total fee-based segment operating expenses
373.4

306.5

954.9

858.1

Segment operating income
$
3.1

26.4

$
11.2

55.0

Equity earnings (losses)
—

—

(0.1
)
0.7

Total segment income
$
3.1

26.4

$
11.1

55.7

Continued: Summarized financial information by business segment is as follows.
 
Three Months Ended September 30,
Nine Months Ended September 30,
(in millions)
2016
2015
2016
2015
Real Estate Services
 
 
 
 
Asia Pacific
 
 
 
 
Revenue
$
331.1

280.7

$
916.9

798.0

Gross contract costs
(59.2
)
(47.7
)
(183.4
)
(146.0
)
Total fee revenue
271.9

233.0

733.5

652.0

Operating expenses:
 

 

 

 

Compensation, operating and administrative expenses
310.2

264.3

871.6

753.7

Depreciation and amortization
4.2

3.7

12.4

10.9

Total segment operating expenses
314.4

268.0

884.0

764.6

Gross contract costs
(59.2
)
(47.7
)
(183.4
)
(146.0
)
Total fee-based segment operating expenses
255.2

220.3

700.6

618.6

Segment operating income
$
16.7

12.7

$
32.9

33.4

Equity earnings
0.5

0.2

0.5

0.2

Total segment income
$
17.2

12.9

$
33.4

33.6

 
 
 
 
 
LaSalle
 

 

 

 

Revenue
$
80.3

134.2

$
307.8

300.1

Operating expenses:
 

 

 
 
Compensation, operating and administrative expenses
71.6

91.5

238.0

227.8

Depreciation and amortization
0.8

0.5

2.1

1.6

Total segment operating expenses
72.4

92.0

240.1

229.4

Segment operating income
$
7.9

42.2

$
67.7

70.7

Equity earnings
4.9

20.7

26.5

57.6

Total segment income
$
12.8

62.9

$
94.2

128.3

 
 
 
 
 
Segment Reconciling Items
 

 

 

 

Total revenue
$
1,705.2

1,501.3

$
4,645.6

4,078.2

Total segment operating expenses before restructuring and acquisition charges
1,616.2

1,362.8

4,395.4

3,781.5

Operating income before restructuring and acquisition charges
89.0

138.5

250.2

296.7

Restructuring and acquisition charges
18.0

18.2

35.9

20.8

Operating income
$
71.0

120.3

$
214.3

275.9