Residential construction boosts Lendlease

Lendlease built a record number of apartments as a big lift in housing completions helped the property giant to an annual profit of almost $760 million.

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Lendlease’s net profit for the year to June 30 rose 8.7 per cent as the company finished major commercial projects in Australia and New York and more than doubled the number of completed residential apartments.

“Residential development was a highlight, with a 20 per cent increase in completions to 5,769, driven by the delivery of a record 2,533 apartments,” Lendlease group chief executive Steve McCann said in a statement on Monday.

“We have settled approximately 90 per cent of these apartments to date, with a default rate of less than one per cent.”

Lendlease also finished building New York’s tallest residential tower and some large projects in Australia, including Sydney’s International Convention Centre and Tower One at Barangaroo South, and the Sunshine Coast University and New Bendigo hospitals.

The company said its investments division, which includes interests in retirement living, office blocks and military housing, has also performed well, generating 36 per cent of the group’s operating earnings.

Funds under management grew by 11 per cent to $26.1 billion.

Mr McCann said Lendlease was well placed for the future, with the company the preferred bidder in more than $10 billion of construction work, including the Google headquarters in London.

The company is working on urbanisation projects in Chicago, Boston, New York and Kuala Lumpur and has secured new projects in Milan and San Francisco.

Also, the Haringey Council in London has selected Lendlease as its preferred partner on the $7 billion Haringey Development Vehicle , a 50:50 partnership between Haringey Council and Lendlease to develop some of the council’s land.

Lendlease said it is progressing well in the residential-for-rent sector, with three buildings under construction in the Americas

“These projects further support our stated objective of rebalancing capital and earnings towards out international operations to drive growth,” Mr McCann said.

Lend lease shares closed 10 cents higher on Monday at $16.55.

APARTMENTS HELP DRIVE LENDLEASE PROFT LIFT

* Full-year net profit up 8.7pct at $758.6m

* Revenue up 10.4pct at $16.7b

* Final dividend of up three cents to 33 cents per security