Lendlease and Mitsubishi Estate Asia have acquired the One Circular Quay development in Australia for around A$800m (€539m) from AW Holdings.

Lendlease will undertake the A$3bn development on Sydney’s harbour foreshore, which will include upmarket residential apartments and a luxury hotel.

Mitsubishi Estate will hold an initial stake of 19.9% in the joint venture, and, subject to the satisfaction of certain conditions, Mitsubishi Estate will lift its stake to 66.7% with Lendlease reducing its interest to 33.3%.

The Japanese investor is already a joint venture partner in the adjoining A$2.2bn Sydney Place project, which Lendlease is currently developing.

It is also a partner in two other projects - Lendlease’s Residences One, in Barangaroo, also on Sydney Harbour foreshore, and a fourth project in Melbourne.

Yuzo Nishiyama, head of Australia, Mitsubishi Estate Asia, said this joint venture further strengthened the long-standing relationship between Lendlease and Mitsubishi Estate.

Global chief executive officer and managing director, Tony Lombardo said: “The acquisition of One Circular Quay is consistent with our objective of replenishing the Australian development pipeline and working with investment partners to improve return on invested capital.”

Tom Mackellar, managing director of development, Lendlease Australia, described One Circular Quay as “undoubtedly one of the most desired addresses to live and stay in the world”.

The transaction ends the chequered recent history of one of Sydney’s best-known sites, previously occupied by Gold Fields House.

In 2014, China’s Dalian Wanda Group bought Gold Fields House for A$425m to develop a billion-dollar project and when Dalian Wanda got into financial trouble, in 2018, the site was onsold to AW Holdings.

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