Lendlease has posted a $1.5 billion loss after announcing a strategic refresh in May. This followed a concerted activist investor campaign to simplify the business and refocus on the Australian development market.
Already, the construction giant has sold more than $1.9 billion in assets—including a substantial portion of its North American business—and remains on track to exit from $2.8 billion in predominantly UK and US assets by June 2025. This includes selling the bulk of its local housing estates business to a venture between Stockland and Thai group Supalai, although this is now under scrutiny from the competition watchdog.
“Our results for FY24 reflected challenging business conditions and the early actions from our refreshed strategy,” according to Lendlease CEO Tony Lombardo, who noted that the company’s simplified management structure would continue to deliver savings.
“Our priorities remain strengthening the balance sheet, returning capital to security holders, investing in our high return Australian operations and growing our international investments platform.”
Lendlease CEO Tony Lombardo on the strategy to pivot back to Australia.
In May, Wood Central reported that Lendlease, one of the world’s largest construction contractors, is selling out of its US and UK businesses – hoping that the deals will eventually free up AU $4.5 billion to pay down debts and reinvest into Australian operations.
At the time, Lendlease Chair Michael Ullmer said the “strategic refocus” is part of a new “blueprint to position Lendlease for success – focusing on our core strengths and competitive advantages.”
The pivot has already freed up money for Lendlease’s development arm to buy into Milligan Group’s new 55-storey ‘Halo’ – a 55-storey timber building that will tower Sydney.
The deal, confirmed in June, will see Lendlease take exclusivity over the site, subject to a due diligence period. The construction giant is busy locking in capital partners before selecting a builder for the main works.
Designed by Bates Smart Architects, it will be one of the world’s most sustainable buildings. It will have Australia’s largest facade PV arrays, use low-carbon concrete, cross-laminated timbers, and glulam, be all-electric, and have net zero emissions. It also targets a 6-Star Green Star and NABERs ratings.
The site spans 15-25 Hunter St and 105-107 Pitt St and is in Sydney’s core precinct, dominated by the financial, legal, property, and tech sectors. For its measure, Milligan has described the project as “a legacy building for Central Sydney in the form of a world-class commercial office tower in the commercial core of the CBD.”
- To learn more about the Lendlease pivot back to Australia, and it’s impact on the global market for timber construction, visit Wood Central’s special feature.
