Lendlease has bought an ageing office building in Australia from Chinese owner Shimao to be redeveloped into a A$2.5bn (€1.4bn) upscale residential project.
Lendlease said that it planned to construct two towers on the site at 175 Liverpool Street in Sydney, offering up to 300 apartments for sale and 2,000sqm of retail and commercial space.
The project will be developed alongside joint venture partners, with a sell-down of up to 50% of the project expected in the coming weeks. Construction of 175 Liverpool Street is targeted to commence in 2027.
Lendlease has not disclosed the identity of its capital partners, but Mitsubishi Estate Asia, an existing partner in other upscale residential projects in Australia, has been suggested as a likely candidate.
The acquisition of 175 Liverpool Street builds on Lendlease’s success in Sydney’s luxury residential market, including the completion of One Sydney Harbour – which set a new sales record for a penthouse – and sales at One Circular Quay surpassing A$2bn, according to the Sydney-based company.
Tom Mackellar, CEO Development, Lendlease, said: “This is one of the most significant real estate acquisitions in the local market in recent times, and strongly aligns with our strategic growth plans in Australia where we continue to identify opportunities to expand our development pipeline.”
The office block paved GIC’s entry into the Australian property market when it paid A$120m to own it in the late 1990s. In 2014, it sold the tower to Shimao for A$390m.
To read the latest IPE Real Assets magazine click here.
