Lendlease eyes picking up Barangaroo pace in bid to ride luxury wave
Global property developer and manager Lendlease is looking to bring forward the development of the next residential tower at Barangaroo in Sydney, to take advantage of the high demand for luxury apartments.
Speaking at the group’s annual general meeting on Wednesday in Sydney, Lendlease chief executive Steve McCann said given the strength of the pre-sales at the first tower of the One Sydney Harbour complex, there is a case to start construction on the next one earlier than planned.
At the meeting, which was more subdued than expected, shareholders did show some bite, with 38.1 per cent voting against an allocation of performance rights to Mr McCann in what was a non-binding resolution.
Non-executive director David Craig, a former finance director at Commonwealth Bank of Australia, was re-elected but felt the wrath of the proxy house ISS which helped inspire 23.54 per cent of shareholders to vote against the resolution.
Our view is there has obviously been a soft residential market for a while but we see a recovery in calendar 2020.
Lendlease CEO Steve McCann
The remuneration report was passed but with a 21 per cent vote against it, which prompted the chairman Michael Ullmer, taking part in his first AGM, to say the the board will reflect on the vote and “whether it is warranted going forward to unpick and reflect on the design of the remuneration scheme”.
“We have three towers at Barangaroo, two high-rise and one mid-rise, so because the first sales process has gone so well, we will probably bring the second tower to the market sooner than expected,” Mr McCann said.
“Our view is there has obviously been a soft residential market for a while but we see a recovery in calendar 2020 is pretty likely across broader housing market and there is still a lot of demand for premium residential apartments.”
Lendlease revealed recently the penthouse at One Sydney Harbour sold for $140 million, while a further seven buyers each snapped up an entire floor “in one line” at Barangaroo South Residence One, each worth about $40 million.
Mr McCann also confirmed the group was in advanced talks with potential buyers for its engineering and services division.
Lendlease shares closed down 1.06 per cent at $19.64.
Carolyn Cummins is Commercial Property Editor for The Sydney Morning Herald.
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