Lend Lease entry a breath of fresh air

Industry players have greeted news that Australian property giant Lend Lease has won the bid for the Somerset Road site with enthusiasm.

‘It is good to have someone different and new coming into the market; they will bring in new thinking,’ said one travel industry observer who requested anonymity.

Firstly, its bid of S$617.2 million is record-breaking for a government land sale in the Orchard Road area and signals a foreign investor’s bullishness about the Singapore retail scene.

Secondly, observers feel Lend Lease will bring a breath of fresh air into the retail scene in Singapore. Hailed as a ‘dark horse’ by the local media, it outbid local giants such as CapitaLand and Far East Organisation.

According to a Lend Lease press release on August 17 announcing the news, the second highest bid was S$610.15 million.

Lend Lease Managing Director and Chief Executive Officer Greg Clarke said the result underscored the value of being an international, diversified property group.

Lend Lease’s only involvement in Singapore is Parkway Parade, which has undergone a recent makeover and is regarded as one of the top shopping malls in the East Coast area.

The Somerset Road site is a 0.7-hectare site, with 100 metres of frontage onto Orchard Road, and is located adjacent to the Somerset Mass Rapid Transport (MRT) station.

'In line with the Group’s strategy, the development represents a significant opportunity for the Group to grow its Retail & Communities and Investment Management businesses in Singapore.

'It is the Group’s intention to retain an interest in the development while introducing partners, either as direct investors or through a new Asian retail fund to be established and managed by Lend Lease,' the company stated in its press release.

For the year ending June 2006, Lend Lease posted a 24% increase in operating profit after tax to A$354.2 million, compared to A$285.7 million it posted in June 2005.

Lend Lease’s portfolio of shopping centres in Australia include Cairns Central, Caneland Central, Erina Fair, Greensborough Plaza, Macarthur Square and Sunshine Plaza. It is also the name behind Bluewater in the United Kingdom, considered by many in the retail development industry to be a benchmark retail development.

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