Lend Lease commits to growth by acquisition, seeking capital partners

Michael Eggington’s growth aspirations for Lend Lease Retirement have always been limited by the competitive access to funds within the corporation. Projects that can earn more money faster in residential development or infrastructure have won support ahead of retirement.

Now Lend Lease has taken a strategy turn and is seeking co-investors or ‘capital partners’ to contribute to acquisition funding. This will appeal to institutional investors seeking the security of property and steady income of a mature village portfolio, coupled with some operational income upside.

Lend Lease values its village portfolio at a 13.3% discount compared to Stockland and Aveo at 12.5%, a significant difference and upside, plus they forecast average value growth at 3.7%, a solid base to offer investors.

Stockland has adopted a similar philosophy but to sell up to 50% of its existing portfolio over the next six months. Lend lease have indicated a ‘medium’ time frame.